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 From: "Fred Langa" <[EMAIL PROTECTED]>
 To: "The LangaList" <[EMAIL PROTECTED]>
 Date: Mon, 8 Nov 1999 12:56:48 -0500
 Subject: [langalist] 8-Nov-99 SPECIAL ISSUE
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                            The LangaList
                          SPECIAL EDITION!

                              8-Nov-99
                                  
     A Free Email Newsletter from Fred Langa About BrowserTune,
       HotSpots, Columns, Tips & Tricks, and Other Activities

                           In This Issue:
                      Why The Special Edition?
                      Getting On The Same Page
                        Analysis and Opinion:
                  Microsoft's Loss Is Not Your Gain
                  And For The "Enterprise" View...
                                More!
                                  

Why The Special Edition?

You've no doubt heard that the initial "findings of fact" in the
DOJ/Microsoft antitrust case were announced last Friday (Nov 5). This
is a case that will have an enormous impact on the type, quality, and
cost of the software (and hardware!) available to you for years to
come, and so I've pushed back (by one day) the normal Monday edition
of the LangaList to bring you this special coverage.
You'll receive your regular early-week edition of the LangaList
tomorrow, Tuesday, Nov 9.
        
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Getting On The Same Page

You've probably heard quick takes and instant analyses of the DOJ
findings against Microsoft, and may have seen some of the more
thoughtful pieces just starting to emerge. To help you get closer to
the sources and so you can make up your own mind about what's going
on, I've set up a full-text copy of the Findings of Fact for you
here (see http://www.browsertune.com/dojvms.htm ). I urge you to take
a look: Again, this is a case that will have an *enormous* impact on
the type, quality, and cost of the software (and hardware!) available
to you for years to come.

When the Findings of Fact were released, I was asked to be a
commentator on a live, streaming-audio Internet news broadcast of the
event. I was one of several panelists who listened to the full
findings-of-fact announcement and the full Microsoft response; we
then tried to dig out the important nuggets of information for the
listeners. Although the live show ran many hours, you can hear a
highly-edited, much-shortened (just 18 minute) RealAudio replay
(including commentary by myself, Jerry Pournelle, and others) at
http://media.cmpnet.com/twtoday/techwebtoday.ram .


More info:

Evidence Is Overwhelming, But Microsoft Fights:
http://www.techweb.com/wire/story/msftdoj/TWB19991105S0023

Gates Response:
http://www.techweb.com/wire/story/TWB19991105S0022

Judge: Microsoft Has Monopoly Power:
http://www.techweb.com/wire/story/msftdoj/TWB19991105S0020

DOJ Celebrates Sweep In Court:
http://www.techweb.com/wire/story/msftdoj/TWB19991105S0026

Microsoft Rivals Cheer For Judge:
http://www.techweb.com/wire/story/msftdoj/TWB19991105S0025

Judge Blasts Microsoft On Most Antitrust Charges:
http://www.techweb.com/wire/story/msftdoj/TWB19991105S0024
        


Analysis and Opinion:
Microsoft's Loss Is Not Your Gain

Last week, I told you I thought Judge would issue a sweep of findings
against Microsoft. (see http://www.langa.com/newsletters/nov-4-99.htm#iweek 
).

That turned out to be true, but the Findings were even harsher than I
expected.  For example, the concluding paragraph in the 200+ page
document states (in part):

          "Through its conduct toward Netscape, IBM,
          Compaq, Intel, and others, 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."

The findings were based on several key points, and some of them
clearly are true. For example, for antitrust law to apply, there must
first be a monopoly. Microsoft does hold a de facto (and now legally
defined) monopoly power over desktop operating systems. Note that
there's nothing inherently wrong or illegal in holding a monopoly;
and with a 90% desktop market share, Microsoft surely qualifies.

Second, for antitrust law to apply, the monopolist must have abused
its monopoly position. For example, it's illegal for a company to use
a monopoly in one area to leverage itself into dominance in another,
and the Court says that's what Microsoft did with its browser.

But that's where I begin to have trouble with the Court's findings.
Most objective analyses show that Microsoft's IE is a much better and
more standards-compliant browser than is Netscape Navigator (or
Communicator). Claiming that Netscape's demise was due simply to
Microsoft's unfair competition ignores Netscape's once supreme market
arrogance and its demonstrably inferior "spaghetti code" product
design. (If you think I'm exaggerating ask yourself this: Why,
although AOL owns Netscape outright, does AOL continue to use
Microsoft IE as its default browser? I believe the simple answer is
that the current Netscape browser isn't up to par.)

Likewise, the Court makes no allowances for the missteps of other
Microsoft competitors: For example, IBM couldn't package or market
OS/2 to save its life: It shipped the OS with a butt-ugly UI, and
hobbled it with high prices and extremely poor---almost hostile---
developer support practices. And yet the Court cites the demise of
OS/2 as an example of Microsoft's power. In fact, I believe it was
due mostly to IBM's bumbling.

To me, it seems that the Court has ignored numerous instances where
Microsoft competitors have shot off their own toes. Microsoft may
have taken advantage of their failures, but Microsoft isn't
responsible for (say) the IBM marketing choices for OS/2, or
Netscape's architectural decisions for its browser.

This just scratches the surface of the problems I found in the
Court's reasoning. Perhaps most disturbing (to me) was what I found--
-or, rather, failed to find---when I went looking for evidence of
what the prosecutors stressed in their press conference and in their
conclusion: That consumers were harmed.

There are amazingly few concrete instances of consumer harm cited in
the long document. The Court seems to focus on the unprovable
assertion that we all would have been showered with wondrous new
technologies, had Microsoft's grip been looser. But the Court cites
no examples--- these high tech marvels remain unnamed, unknown, and
unidentified. To me, that makes for an empty and emotional argument:
You can't prove what isn't there or what might have happened.

I spent most of Sunday wading through the document. There are several
cases cited where Microsoft can be shown to have harmed consumers,
but many others where I think the Court missed, or misconstrued, the
facts. I'll show you what I found---pro and con---in this week's
column on WinMag.com. (It's way too much to squeeze into an email.)

Has Microsoft behaved badly? Yes; surely. But it seems to me that the
main targets of Microsoft's bad practices were its competitors, not
consumers. (Check out the quote, above!) While Microsoft may well
have gone too far in some areas, I believe a balanced view---a view I
naively thought the Courts were supposed to provide--- would weigh
the excesses against the benefits, and arrive at a just perspective
that seeks to remedy the bad practices while preserving the good.

Instead, this Court seems to have focused almost entirely on the
negatives and ignored the positives. To me, it looks as if the Court
is moving toward a harsh and punitive judgment---such as breaking up
Microsoft---that I believe will do far more harm to consumers than
good.

Why do I feel that way? Because, on balance, consumers have benefited
far more than that have been harmed by Microsoft---and I believe I
can prove this in my WinMag column this week.

While that does not excuse Microsoft's excesses, in my mind it surely
does mitigate them. In overreacting to Microsoft's excesses, I fear
the Court just may toss out the baby with the bathwater.

But what's your take? Is Microsoft as totally evil as the Court
contends? Do you feel Microsoft has harmed you, as a consumer? Should
Microsoft be broken up? Will Microsoft be able to avert a harsh
judgment through a negotiated settlement?

Please read the full column and then join in the discussion via the
link on the home page at http://www.winmag.com ; the column and
discussion should be live by midafternoon today (Nov 8, EST; GMT-5).
Please join in!
        


And For The "Enterprise" View...

The Findings of Fact supposedly focus on consumerism, but clearly,
there are huge implications for businesses that use Microsoft
products.

InformationWeek has a venue to discuss that: it's the BBS area
attached to my column at http://www.informationweek.com/langaletter.
There, you can cast your vote to agree or disagree with the judge,
and then join a discussion on the business implications of the court
findings.

Join in!
        
See you in the regular issue, tomorrow!

Best,

Fred

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