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Saturday, November 02, 2002


So the judge has finally made her call, and Microsoft get to stay together. Good for Microsoft, and bad for the competition, this seems to be the 'thinking persons' response. And for the rest of us? Especially those who are neither insiders nor complete info-freaks. This I think this one is very diffficult to call. I am an MS user, but I never bought anything from them directly in my life. The windows o/s comes with the computers I buy, and everything else follows from that. The other important part to my life, the browser, well I'm indifferent: Mozilla, Netscape, Internet Explorer, it's all the same to me. Perhaps I should use Mozilla, since I guess I think they're good folks, and I'm sure glad they exist.

And this, I think, is the point here (apart from the obvious one, that when you let Federal Court judges pontificate on internet browsers, you get what you ask for). There is virtually no possibility of a commercial rival for Microsoft appearing on the PC market, Microsoft could always outdo them in both quality and price. Following theories of dynamic competition under increasing returns, the only normal option here would be competition over platforms, by which I mean a rival, being blocked in the PC market could, in the manner of Palm, develop a rival platform to displace the MS based incumbent. The threat of this, is what, at the end of the day, and with more guarantee of impact than any court ruling, will force Microsoft to move.

But there is, of course, a non-commercial alternative. Call it Linux, or call it open-source, the alternative to Microsoft is there and it's presence is felt. Talk Instant Messengers, talk Movie Players, Microsoft is not a normal monopoly. Linux, we will remember is free. For a price-competitive international PC market long-term this can make it an attractive proposition. Linux can also count on the presence of hundreds of thousands of 'collaborators', all giving their time free, in the development of cutting edge uses and products. So Microsoft cannot just go to sleep and collect rents. In fact it could be argued that the leverage of open-source on Microsoft is the dynamic really driving innovation in the user-oriented apllications world. Microsoft only 'owns' Media Player under a very strange meaning of this word. For they are not free to decide what goes in the package as many critics fear. Since all of this is user driven, and the leading edge users have overwhelmingly entered a use-and-share culture, the truth is that Microsoft has become a virtual prisoner of the 'hackers', as the world of Hollywood knows only too well. If Media Player isn't compatible with the appropriate hack driven codec, then it simply won't survive, and if it doesn't survive, then ultimately Windows is finished, since its power lies in its compatability, and we're not talking about the latest version of office suite here. Those who have upgraded to XP know only too well, the main advantages (over say Windows 2000) lie almost exclusively in the content-management/leisure uses, and for the PC industry selling more 'souped up' units depends on creating more 'souped up' uses. In one of those strange and wonderful twists in historical logic, Microsoft has now become the main shield protecting P2P from the movie and record industry.

The day they stop doing this, that day their 'monopoly' breaks. Where exactly on the curve the tipping point between Windows and Linux lies, which small change will finally tip the scales from one to the other (or to a third, as yet unimagined, rival contendor), no judge can say. But one thing is sure, the day the new PCs ship out in bulk with another o/s, that day I'll be changing camps.

In conclusion then, Microsoft are in a sort of 'prisoners' dilemna. Or perhaps, following Hegel, this is just another instance of the master-servant dilemna. The master needs the 'look' and the respect of the servant much more than the servant 'needs' the master. In his book Beyond Belief, VS Naipaul, tells us of a wall slogan he saw outside Teheran's main prison. Written by the inmates, it reminded the guards, that they, having served their sentence, would leave. Those who would never leave - the jailers - these in fact are the true 'prisoners'.
Of course, Judge Kollar-Kotelly understood nothing of this.

When the federal government and 20 states filed their sweeping antitrust suit against Microsoft in May 1998, the company dominated the personal computer business and was aggressively moving into the markets for software for hand-held computers, cellphones, television set-top boxes and data-serving computers. More than four years later, little has changed. And there is little in yesterday's ruling on sanctions in the case by Judge Colleen Kollar-Kotelly of Federal District Court in Washington that will slow down the big software maker.

By endorsing most of the Bush administration's settlement with Microsoft, reached last year, the judge adopted a fairly narrow view of the case and showed a reluctance to meddle in Microsoft's business practices and product designs. She rejected calls by nine dissenting states seeking tougher measures, like requiring Microsoft to offer a stripped-down version of its Windows operating system or to publish freely the programming code for its Internet browser. In doing so, Judge Kollar-Kotelly chided the plaintiff states, writing that some of the proposed remedies appeared to be intended "simply for the sake of changing the status quo." In a passage that echoed Microsoft's complaint that its legal problems were the work of its rivals, she wrote: "Certain of Microsoft's competitors appear to be those who most desire these provisions."
Source: New York Times

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