|by Wes George
Here Comes the Judge
November 8th, 1999
Microsoft has demonstrated that it will use its prodigious market power and immense profits to harm any firm that insists on pursuing initiatives that could intensify competition against one of Microsoft's core products. Microsoft's past success in hurting such companies and stifling innovation deters investment in technologies and businesses that exhibit the potential to threaten Microsoft. The ultimate result is that some innovations that would truly benefit consumers never occur for the sole reason that they do not coincide with Microsofts self-interest.
From the conclusion of the Findings of Fact signed Thomas Penfield Jackson, US District Judge
All rise. The honorable Judge Jackson finds that Microsoft is a monopoly. Duh! Furthermore, he finds Redmond has systematically and criminally abused its power to thwart innovation.
To long time Mac users, this talk of malicious monopoly sounds almost ludicrous for two reasons.
One - it's too little, too late to effect the outcome in the OS wars. The US DOJ calvary storms in to save the day, but the competition has already been assimilated, or cleansed. The DOJ is even less effective than the UN was in Bosnia. The only real surprise in Judge Jackson's findings is that Microsoft hasn't already "stifled" or "deterred" the US Justice System.
Two - ironically, Apple's Mac OS is discounted as a viable competitor of Windows. Perhaps some one should tell that to the Mac faithful who, like some isolated and content Cambodian highland tribe, go about their everyday business almost oblivious to Microsoft's egregious hegemony.
Nevertheless, Mac users do feel left out of the party when they read the news and see no mention of our stake in this affair. After all, this is the Karma stage to the decade-plus long feud in which the two original combatants were Apple and Microsoft.
Although Apple's role in the Findings of Fact is pronounced, Judge Jackson begins on page 8 by defining the Mac OS as totally irrelevant to the question of whether or not Microsoft is a monopoly.
Ouch, that hurts, and it is (or was) essentially true. Apples position in the market place offers so little competition to Microsoft as to have no affect on their monopolistic intentions. However, the DOJ's horse and buggy implementation of the Sherman Antitrust Act can't hope to keep pace with the exponential rate of software evolution in the information age. The victims the DOJ would save are long dead. Those they could help, like Apple, seem to be beyond the scope of their limited vision.
The Media needs more RAM
Red Hat Inc. (RHAT), a trendy, but unprofitable newcomer to the OS Wars, receives citations in the media as a possible future alternative to Windows. Yet, its only product, open source Linux, is freely available elsewhere making Red Hat little more than a shrink-wrapping service company. Mr. Barksdale, former CEO of a company (Netscape) that no longer exists, is highly sought for interviews about this turn of events. No one calls on Apple for a headline story. The media has a memory half-life of about one year.
This saga begins long before Red Hat, Netscape or even the sabotage of DR DOS. It starts with Mr. Gates and Mr. Allen reverse engineering (read: stealing) the Mac OS to create that Frankenstein monster called Windows. Much like those ancient code warriors of the 60's who never imagined their double digit, date coding convention would live to make the Y2K glitch possible, Mr. Gates and cronies didn't originally design their chimeric OS to perpetuate itself, zombie-like, into the 21st century. But here we are eagerly awaiting the arrival of Win2000.
The judge's ruling on Friday is pure vindication to every Mac user who ever rose to the defense of our platform amidst jeers from the Wintel borgs at a cocktail party, or around the water cooler.
It hardly matters if Microsoft weasels out of the next phase of the trial by striking a plea bargain like a common criminal, or whether they spend a spare billion to drag the case all the way to the Supreme Court, in a state of O. J. Simpson-esque denial. We now have the 207 page Findings of Fact for everyone to read and to learn whose hands are stained with the blood of a thousand murdered innovations!
Owning equity in Microsoft is now officially like owning stock in a tobacco or firearms manufacturer. Microsoft is a high risk stock. Friday's findings will spawn hundreds of civil lawsuits against Microsoft over the course of the next decade. Moreover, if you have any sense of social responsibility you'll eschew sharing the profits from ill gotten gains.
OS X or Win2000?
Microsoft should be held criminally and civilly liable for any damage they have caused. However, it does seem plausible Win98 was the apogee of Microsoft's ascent, and with Win2000 we will witness Microsoft's slow decline. And this decline will come about naturally, if belatedly, without the DOJ's intervention.
I believe that OS X could become a credible threat to Win2000 in the next few years. Don't laugh!
The cost of upgrading to Win2000 is about equal to the cost of trashing your PC with all its Windows software and migrating to the Mac platform and OSX. Giga Information Group, in a study approved by Microsoft as borg friendly, said that the average cost of upgrading to Windows 2000 Professional will be about $1,640 per desktop system! While a study published by the Gartner Group found those numbers far too low. After all, a thousand of that $1,640 is just for the license. Up to 98% of all PCs in operation can't even run Win2000 without a hardware upgrade and more than half will have to be replaced altogether.
The clincher in favor of Macintosh has to do with the cost of maintenance. In Mac shops at the University of Texas there is one Mac technician for every one hundred Macs. While on the PC side there has to be one PC technician for every 20 PCs running Windows 95 or 98. The ratio for NT boxes is more like 1 to 2 and those NT dudes spend hundreds of hours in training before they even get to the installer! Which platform is less expensive? You do the math.
Need more proof? See my extrapolation of Walter Mossberg's own numbers, which suggest that Windows cost the world economy billions in lost productivity due to its inherent instability.
So why not just tax write-off those NT servers and PC boxes next year and migrate to the multi-tasking, multi-threaded, true micro-kernel, stable Unix-based environment of Mac OSX on a G4? Perhaps, even the bean counters in accounting will be able see the rationale this time.
As for the viability of Linux, I have a friend who is paying $7,000 to become certified to work with the system. Enough said.
Apple hasn't lowered the skull and cross bones, nor surrendered to Microsoft. With Steve Jobs at the helm, just about anything is possible.
This might be a good time to short MSFT on the first uptick.
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Wes George writes about the financial side of being a Mac nut. Wes has followed Apple's finances for the last 7 years and comes to The Mac Observer every Monday to tell all about his opinions. He is, in his own words, "inordinately fond of money." If you would like to write Wes, make it nice. Someday you might own a company that has something to do with Apple, and Wes will probably still be writing for The Mac Observer...... On the other hand, Mr. George is known to love a rousing, hair-raising debate, so send him your worst!
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