This Story Posted:
June 23rd, 1999

[12:57 PM]
Apple Cited By Microsoft Witness As "Proof" Of Competition

In an amusing turn of events, Microsoft's last witness to be called in the governments antitrust lawsuit against the software company has named Apple Computer as proof of the power of competition. The witness is economist Richard Schmalensee. According to an AP report: "The threat of future competition requires Microsoft to innovate rapidly, to evangelize, to invest in improvements,'' Schmalensee said Tuesday. Schmalensee told US District Judge Thomas Penfield Jackson that Microsoft is challenged by a newly resurgent Apple Computer Inc. and an upstart software movement surrounding the Linux computer operating system. Jackson was clearly impressed with Schmalensee's depiction of a new generation of so-called "server-based'' software - programs that will be delivered across emerging high-speed Internet connections rather than relying on Microsoft's dominant Windows operating system. "Can you do that?'' asked Jackson, adding later: "The concept to me sounds very attractive. I can't imagine why ISVs (independent software vendors) aren't developing applications in droves.'' Schmalensee reminded the judge of testimony last week from another Microsoft witness, software executive Gordon Eubanks, who said the Internet has become "the platform of choice.'' The Mac Observer Spin: Once again Microsoft attempts to cloud the issues with unrelated facts. The Internet is NOT a platform. At least not yet. It takes a platform to get onto the Internet and applications that you run from the Internet are by and large written for your platform (Java apps being the only exception, and a poor exception at that). As for Apple, though it is certainly our fondest wish that Microsoft be displaced by Apple, that is just not possible. It is a matter of an economy of scale. Even if 90% of the world's computer buying populace was suddenly to decide to want a Mac, Apple can't even pretend to manufacture that much. In fact, Apple can't even provide enough computers for the marketshare it does have. But even if they could, we would just be changing one monopoly for another, certainly not a good solution. The sad reality is that Apple, in its current incarnation, would find it very difficult to offer 10% of the market its products due to manufacturing limits even over the next few years. We are not sure we want to see Microsoft broken up into small chunks and not sure that it is the government's place to tell Microsoft what products it can bundle together and "integrate." At the same time, claims that the company innovates are nothing short of preposterous. The company writes crappy code, ironically with the exception of its Mac division, and sloughs that crap onto the public with nary an apology for any bugginess or pther problems caused by their slacking. Microsoft also leverages that marketshare to force absurd pricing structures on many corporations after that company adopts Microsoft products (we are referring to Excel pricing which Microsoft has recently switched to a per user license instead of a per seat license). On top of that the company uses intimidation and threat of reprisals as its number one marketing weapon. These are reprehensible traits that any truly self-respecting company should be embarrassed to employ. The flip side is that corporations and individuals have been foolish enough to pay their prices and swallow their crap. Perhaps they should be left to their own devices. In the meanwhile, Richard Schmalensee seems to be a bit off in our opinion. Microsoft - Apple