On Oct 20, 4:44 pm, "amicus_curious" <A...@xxxxxxx> wrote:
> "7" <website_has_em...@xxxxxxxxxxxxxxxxxxxx> wrote in message
> news:WqqSi.34302$c_1.6497@xxxxxxxxxxxxxxxxxxxxxxxxxxxxx
> > I think any future monopolies and anti-trust investigations should
> > look at adverse effects of buying up small companies by big monopolies.
> > In the software technology sector, the end result is usually less choice.
Over the long run, this is true of Microsoft, but much less true of
other large companies who purchase smaller companies specifically
hoping to increase the diversity of their offerings. In fact, many
small companies are purchased BECAUSE they support a diverse range of
platforms and strategies.
IBM, Oracle, SAP, and many other large companies often encourage the
interoperability and support of not only their own products, but also
those of established competitors. For customers who want "one stop
shopping", the option is available, but many companies already have
infrastructure installed, and merely want a solution which interfaces
with their existing infrastructure.
Imagine if IBM or HP came into an major business with an RFP that said
"We have an end-to-end solution, but you will have to convert all of
you building wiring to a 440 volt 440 hz power source, because thats
what we have decided should be the standard, and we will provide the
conversion from public utility service to this specialized power
source, but no other AC appliances will work.
If an IT shop has been using Oracle, and they like Oracle, and they
don't want to switch to DB2, then IBM needs to provide solutions that
will integrate to that Oracle environment.
Large Media companies often create a matrix of distribution,
creativity, and branding options, which have often been structured to
create the widest possible diversity of offerings, as opposed to
creating an exclusive virtual monopoly.
If Microsoft were to lose control of the OEM channel, voluntarily,
through court action, or through market action, the result would me a
more inclusive market with more interoperability. For example, all
PCs would be equally capable of running Linux, Windows, and even
Solaris or OS/X. The user could even pick his preference at boot
time, booting into the system of his choice each time the disk was
rebooted. There would probably be the option of establishing a choice
of standard file-systems which would work with all of the available
operating systems.
The vendor might even include several DVDs, from each of the supported
vendors. The user could then use these DVDs to expand a core offering
into a robust offering with a huge suite of applications that are
compatible. Some of those applications would be OSS and freeware,
some would be shareware, and others would be license key activated
applications. The keys could be purchased over the internet for
prices ranging from a few dollars to a few hundred dollars.
The OEMs would collect the market research information themselves, and
would use this information to better serve end-users as well as
corporate customers and retailers.
Ultimately, Microsoft will lose monopoly control of the market. No
monopoly has been able to maintain control for extended periods of
time without either turning into a criminal organization, or without
facing aggressive tactics from determined competitors. Sun has
already won a lawsuit which ultimately led to the inclusion of Java 2
runtime edition on nearly every PC produced. Today, Java 2 Runtime is
more universal than Microsoft's Active-X controls. Even machines that
run Windows often have Active-X and .NET disabled because of security
and virus problems. Meanwhile, Java 2 Runtime Edition is supported on
Windows, Linux, OS/X, embedded Linux, cell phones, and a number of
"appliances".
The problem is that Microsoft is still allowed to exclude other
competitors, including Linux, Star Office, and FireFox from the bulk
of the marketplace. There are a few manufacturers, such as Acer, who
have always openly defied Microsoft, and they have begun to offer Star
Office instead of Office, and FireFox in addition to Windows, but even
this is a feature which many OEMs have requested and have not received
the required written approval to do.
Although Microsoft still controls the content and placement of
advertising that uses Microsoft trademarks and logos, more and more of
the OEMs are publishing separate ads and announcements declaring which
machines are Linux capable by announcing that users who want to order
"Linux only" machines can do so. Although very few "Linux only"
machines are ordered, these announcements often generate sales of
those products, even though they are sold with Windows preinstalled.
> The little companies' owners would think that you are a fool. Selling out
> to a big company is how people who start little companies get rich.
I would have to agree with Amicus on that one. For most
enturpreneurs, they have two possible ways to turn a profitable
business into personal high net worth. They can go public, which
means turning control over to investors, investment banks, and
institutional investors, and being bound by multiple regulatory
agencies who will be watching your every move.
The second option, being purchased or merged with a larger company,
gives the owners substantial shares of a high quality stock, provides
liquidity for those who are ready to move on to the next project, and
usually provides a substantial source of long-term income in the form
of salaries and/or perks and/or dividends.
Often, the transition from start-up to stable business to large public
corporation to $billion large-cap requires a substantial range of
skill sets. Bill Gates had to pull in Steve Ballmer because he needed
someone who understood the process of building a company and going
public. Bill also needed his father to guide him through the process
of going public and negotiating the intricacies of corporate law in a
manner that still gave him undisputed control of the company.
Paul Allen eventually lost interest in Microsoft and went on to build
new companies, many of them competitors to Microsoft, including AOL.
Allen was also a big philanthropist long before Bill Gates. For Paul,
the adventure was taking an idea from concept to reality, turning it
into a large public company, then turning it over to someone who could
manage the day-to-day operations and find that interesting, and do it
profitably. He was also a key player in the expansion of Cable
Television, Digital Cable, and as a result, residential high speed
internet.
> > Big companies force on to little companies the dogma of producing
> > for only one platform after they have been taken over that then
> > reduces consumer choices.
That's generally not true in most industries. It's more true of
Microsoft and the OEM PC industry, primarily because Microsoft
originally established it's control of the OEM market by telling those
OEMs "You can produce a computer that is just like IBMs, and all you
have to do is license their BIOS and our operating system. In the
early years - 1982-3, IBM couldn't keep up with the demand, so they
were actually quite willing, even eager to license hardware and BIOS
technology to other companies like Compaq, Hewlett Packard, and even
DEC and AT&T.
Ironically, it was only when IBM tried to cross-bundle Microchannel
and OS/2 that the OEMs began to fully submit to Microsoft's monopoly
control, eventually accepting exclusive deals for MS-DOS, Windows 3.1,
MS-Word, and MS-Excel. It was also at that point, that the courts
began to more closely scrutinize Microsoft's use of vaporware
announcements as fraud, their use of per-processor pricing as
extortion, and their use of tie-in sales of applications such as
Office with Windows as collusion. Microsoft offered settlements in
each of these cases which prevented drastic actions such as punitive
damages, injunctions, or court appointed micromanagement. Even in the
case of the DOJ Antitrust case, the ultimate outcome was a settlement
which prevented even the possibility of court-ordered divestiture.
IBM eventually hired outsider Lou Gerstner to run the company. He
overhauled the company, eventually replacing and redefining the entire
relationship with the customer from sales reps trying to sell hardware
and software, with all of the incentives designed to push customers
into the most proprietary products in vertical integration, to
consultants solving corporate business problems in which IBMs software
and hardware could be integrated with existing infrastructure using
public Open Standards. Sam Palmisano was a key player in building up
that consulting organization and quickly discovered the value of Open
Source as a tool to further improve the quality of integration and the
ease of solution integration. Today, under Sam's guidance, IBM is a
major contributor to a number of Open Source projects, often granting
licenses to IBM's patented and proprietary copyrighted software that
has been republished under Open Source licenses.
Sun Microsystems is a company that was literally built on a foundation
of Open Source. Bill Joy was a major contributor to BSD, and from the
earliest Sun offerings, they have always encouraged the use of Open
Source software, including BSD software. In addition, Sun has offered
many of it's software technologies ranging from RPC and NFS to much of
J2EE as Open Source software. Even today, Sun often sells new servers
to customers who started the pilot project on Linux, and were able to
quickly and easily switch to Solaris because of library level
compatibility.
> > While consolidation like this happens all
> > the time, its unacceptable that it has to happen through monopoly
> > acquisitions to extend a monopoly.
The issue with Microsoft isn't the monopoly extending the monopoly,
but the WAY they have extended the monopoly. As I have pointed out in
the other examples above, most large companies with a broad vertical
offering attempt to offer a matrix of offerings. Ford, GM, Chrysler,
Honda, and Toyota all offer Compact cars, Coupes, Sedans, Minivans,
and SUVs. All run on a range of fuels from regular to premium, and
many are now offering the ability to run on 85% ethanol. The
manufacturers cross-license each other's patents and a great idea in
one company quickly gets licensed to all of the companies. The result
is safer, more reliable, more fuel efficient, and more economical
personal transportation.
When I sold video equipment in the late 1970s, I often found it
amusing to see how many cross-licensed patents there were between the
various VCRs. There were substantial differences between Sony's beta-
max and JVC's VHS. Beta was much more popular with those who wanted
to do a lot of editing, but not as popular with home viewers who just
wanted to tape a 2 hour show on Monday and watch it on a Sunday
afternoon. On the other hand, when one company came out with 14 day
14 event programming, it was usually only a matter of months before
the other players had it too. Much of this was because the different
components were actually purchased from the same manufacturers. It
was cheaper to cross-license 4-head drives to everybody than it was to
try and re-tool the factory for different types of drives for each
maker. It was cheaper to cross-license one programming chip/computer
than to try and custom program chips for each run. It was cheaper to
cross-license slow-motion and Fast-forward than it was to try and
offer custom versions for each maker. Part of this was the way patent
cross-licensing was managed. Often, a number of minor patents would
be packaged in an offering for a major patent, and a major patent
would be offered in exchange for a number of minor patents. This
assure uniform access to patents across the industry.
A good look at Linux/OSS would give an indication of the natural
progression of a freely competitive market. Even though there is only
one version of Linux, there are compatibility libraries for OS/X, AIX,
Solaris, FreeBSD, and nearly every other version of Unix, as well as
Cygwin to offer compatibility on Windows. Java is available on all of
these platforms as well. Open Office is written against Java, giving
it a wide variety of compatible platforms. Users can get GTK and Qt
libraries which will allow them to run Gnome and KDE applications
regardless of whether they are running a Gnome or KDE desktop - or
even a Microsoft desktop. In each application class, there might be
3-5 different competitors, all of which have advantages over their
competitors, none of which has such an overwhelming advantage as to
merit an exclusionary contract.
> > If a monopoly wants to extend
> > itself, it should do so by opening more offices and writing competing
> > code while the smaller companies produce more cutting edge products
> > and for more operating systems to collect more revenue.
Ironically, Microsoft is almost being circumvented. Whether Microsoft
likes it or not, there are ways that end users can obtain all of that
software, including Open Office, Cygwin, Firefox, and all of the other
competitors' software. The problem, and the legal issue involved in
Microsoft's contracts with OEMs is that Microsoft attempts to engage
OEMs in contracts which are designed to exclude competitors from the
OEM distribution channels. As a result, end-users are unable to "test-
drive" these applications on a retail sales floor. As a result,
Microsoft maintains an illegal advantage over these competitors.
There are two possibilities. The first is that these OEMs are willing
participants in a collusion scheme, or they are being coerced into
excluding competitors by Microsoft's monopoly power. The testimony
given in the DOJ case showed that the latter was the case. The
testimony in both the Antitrust case and the Contempt of Court case
showed that Microsoft openly threatened competitors with drastic
actions which included attempts to revoke all licenses, refusal to
license to OEMs who offered competitor products, sanctions against
retailers who offered PCs which displayed competitor products such as
OS/2, and even attempts to Blackmail IBM into submission.
> Why would a little company want to bother with a bunch of freeloaders like you?
I don't know. Why would a little company like AOL want to bother with
a "free" protocol like TCP/IP instead of the commercially supported
OSI stack in 1993? Why would a little company like Yahoo want to
publish documents in HTML or SGML instead of pumping out proprietary
documents in Microsoft Word format in 1994-5? Why would a little
company like Lycos want to use Apache and Perl or PHP instead of
paying a $5 million "start-up" fee in licenses to establish their
first web sites in 1995-6? Why would a little company like Amazon
want to use OSS tools to integrate their web sites to warehouse,
inventory, and shipping in 1998? Why would a little company like
Google want to use an array of Linux boxes to generate 3 second search
of 30 billion documents?
The point is that OSS provides the infrastructure that lets little
companies become HUGE companies. OSS lets entrepreneurs find new ways
to solve problems that were previously unsolved, and to grow their
little businesses into huge businesses. Look at some of Microsoft's
biggest rivals, including AOL, Yahoo, Google, and Amazon, and look at
the role that OSS had in each of those companies, even from the very
beginning. In many cases, Microsoft even poured $billions into
creating competitors, but was unable to displace their OSS based
competitors.
Look at some of the current problems in business today. Things like
content management, information life-cycle management, and work-flow
management, all problems that can easily be resolved by switching to
OSS, and will continue to persist so long as end-users continue to use
proprietary content products such as Microsoft Office.
For example, McGraw-Hill has some of the largest and most pristine and
substantial archives in the industry, and much of this is because they
began archiving ALL of their content in SGML as far back as the early
1990s. This included S&P's MarketScope, Stock Reports, and Edgar
filings. XML and HTML are subsets of SGML, and SGML documents can
easily be converted to XML or HTML or many other document formats
using simple standard tools. The Linux Documentation project started
using SGML in the early 1990s as well. SGML was first introduced as
OSS by IBM for the Athena project. It was based on their proprietary
GML, but IBM offered a specification so complete that college students
were able to implement the Standard Generalized Markup Language within
a very short period of time. The Athena project also introduced X11
and the EZ Editor, the first multifunction WYSIWYG X-Windows based
editor, almost 2 years before Microsoft Office for Windows.
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