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Re: [Rival] "<Vendor> Recommend Vista" is a Big Paid-for Lie

On Aug 13, 8:13 pm, Mark Kent <mark.k...@xxxxxxxxxxx> wrote:
> Roy Schestowitz <newsgro...@xxxxxxxxxxxxxxx> espoused:

> >| So, next time you go to an online PC sales Web site and you see that line
> >| about "We recommend Genuine Windows Vista Home Premium," just remember:
> >| They're lying.

Actually, they are just honoring one of the requirements of their OEM
license.  Microsoft doesn't even pay extra for this.  Remember, the
OEM license includes a license to use the trademarks and logos of
Microsoft.  The OEMs are not allowed to do anything that will "Damage
the Brand" and Microsoft must give prior written permission to any
thing that THEY might consider a damage to the brand.

This includes:

Any mention of Linux or any other competitor.
Any mention of any competitor's software, such as OpenOffice.
Any reccomendation of any software other than Microsoft's.
This includes advertising, promotional materials, and "Official"
statements made in "official" press releases.

Personal statements made by executives or employees is not covered.
Even comments made informally during an interview are not covered.
People like Michael Dell, Sam Palmisano, and Carly Fiorina have used
this little loophole quite effectively.  During speeches, they might
make informal statements as an aside, or they might make a public
announcement during the "Question and Answer" sessions.

In more recent times, the OEMs are being more aggressive, and most
have demanded that Microsoft list the exact reasons for any rejection
and that the rejection must be receieved within a finite period of
time, usually 5 business days, or it will be considered "approved".
Furthermore, if the objections are handled, Microsoft cannot come with
new objections as a delaying tactic.

The OEM is free to ASK for anything, but Microsoft's approval or
rejections of these requests is very unpredictable.

Retailers are also licensed in a similar fashion, and in some cases
Microsoft's objections have been a bad case of "be careful what you
wish for, you will get it".  When Carfour decided to put Linux
machines on display on their sales floor, Microsoft tried to claim
that having both Vista and Linux machines running and next to each
other would damage the brand.  Carfour handled the objection by
turning ALL of the machines off.  Since Vista machines require more
RAM (4 Gb), hard drive (200 Gb @7200 RPM), and faster CPUs (Core 2 Duo
@ 2.5 Ghz) to provide even performance comparable to XP running on a 2
Mhz Pentium IV with 512 Mb of RAM, or Windows 2000 running on a 1 Mhz
Pentium with 128 Mb of RAM, the prices for the Vista machines fully
configured to run Vista were double to triple the price of the Linux
machines which can run very nicely with as little as 256 Mb of RAM and
100 Mb of hard drive but came with 512 Mb, 160 Mb, and Core 2 Duo @ 2

> >http://blogs.computerworld.com/the_biggest_blue_screen_of_death_ever

> > This "recommends" thing should be illegalised. It's false advertising. It's
> > paid for. It's misleading and corrupt.

Actually, the problem is that the Fair Trade Commission or other
agencies that monitor fraud have several problems.  First, Microsoft
didn't sell Vista to the end-users, they sold them to the OEMs, who
have made minimum commitments for more licenses than they can possibly
use in a year, and they will have to place a new order en the
following year.

Microsoft isn't even allowed to give them credit for the unsold
inventory in the form of lower per-unit prices.

Therefore, the regulatory agencies have to prove that the OEMs were
decieved into purchasing Vista based on fraudulent claims made by
Microsoft.  How many CEOs are going to say "I didn't understand that
Microsoft was lying and I was duped by Microsoft after all these years
of dealing with them". This isn't the kind of statement that investors
like to hear.

Since the OEM has already purchased 10 million Vista licenses, and
knows that it won't sell more than 8 million of those licenses, of
course they are going to reccomend the product they've already paid
for.  Since they've already paid for Vista Business, they are also
likely to reccomend the most expensive home version (Vista Home
Premium) for home users, and Vista Business edition for Business and
professional users.

> It's an interesting point.  One wonders if this should be taken up with the ASA?

Microsoft was first investigated for fraud in 1987, for it's use of
Vaporware, promising features in future versions that were supposed to
come out during the contract period, with the intent of preventing
these OEMs from purchasing competitor products such as Mac OS, or DR-
DOS with GEM.  Similar tactics were used to dissuade OEMs from
switching to competitors such as SCO Unix, OS/2, SunOS, UnixWare, and

When Microsoft announced to the OEMs that they would have the choice
of Windows alone at $100 per machine, or Windows and Office at $150
per machine, the United States Federal Trade Commission voted to turn
the case over to the Clinton Department of Justice.  Microsoft offered
3 settlements which were rejected by federal court Judge Sporkin and
when Microsoft appealed, the case was turned over to Thomas Penfield
Jackson, who reluctantly accepted the agreement in 1994.  The ink was
barely dry on the order before Microsoft released Windows 95 with
Netscape.  Even this was deemed "not actionable" by the DOJ, until
Microsoft sent Compaq a notice that their licenses to one of their
most popular lines was being revoked because they had installed
Netscape and put the Netscap icon where the IE icon was supposed to

At that point, many of the developers of Mosaic, Microsoft's browser
rebranded as IE, were working for Netscape, and they threatened to sue
the United States for unilaterally altering the NCSA license without
getting their consent, and then violating the terms of the original
NCSA license under which the code was contributed, and allowing
Microsoft to make propietary enhancements that were not being released
back into the NCSA.  In effect the US government had STOLEN the
software and sold the stolen software to Microsoft for $2 million.

At that point, the DOJ "settled" by going after Microsoft by filing
the contempt of court complaint.  During the evidence hearing,
Microsoft tried to claim that they were not violating the "bundling"
restrictions of the settlement, because these were "Operating System
Extensions".  The Judge didn't agree and cited Microsoft for
contempt.  Microsoft appealed, but instead of arguing the legality of
the judges rulings, they waited for the DOJ to argue for the
legitimacy of the rulings of law based on the evidence, and Microsoft
decided to Testify and present NEW EVIDENCE, and proceded to introduce
a whole bunch of new facts, which the DOJ was not prepared to rebut.

In a split verdict, the Appeals court found 2 to 1 in favor of
Microsoft.  At this point, Netscape was ready to more officially
persue their case.  That's when the DOJ started getting pressure from
ALL of Microsoft's competitors, and the DOJ filed the Antitrust case.

Initially, the DOJ was having a hard time getting hard evidence
against Microsoft and filed a rather limited set of assertions against
Microsoft.  At the time, they couldn't get the evidence they needed
that Microsoft was using criminal means to protect and extend it's
monopoly, so they just went for the most basic charges.

Judge Jackson wanted to give Microsoft every possible advantage, and
didn't want the trial to turn into a circus, so he limited the scope
of the trial to the charges already filed, limited the number of
witnesses to 25 witnesses per side, and established a high burdon of

During the preparation phase, the DOJ found that each time they went
to interview a prospective witness, the Microsoft lawyer was there
next to the witnesses lawyer, telling them that they could not answer
most of the questions, because it would violate the nondisclosure
agreements.  When this practice was raised before the judge, he
remarked, on the record, "sounds like obstruction of Justice to me",
and looked at the Microsoft lawyers.

The next day, Microsoft issued a public announcement that all
Microsoft partners, customers, and vendors were to cooperate with any
federal investigators, and that they did not need to have Microsoft's
lawyer present.  Within 24 hours, the DOJ was flooded with e-mails and
phone calls of people saying "I have something to say now".  The DOJ
took sworn depositions, many of which asserted criminal activities,
including what appeared to be fraud, extortion, blackmail, sabotage,
and obstruction of justice.  Since the DOJ was limited to 25
witnesses, they just took sworn depositions, and submitted them as
evidence, hoping to help convince the Judge that the tales told by
their witnesses would be treated as "the tip of the iceberg".

Jackson was throroughly convinced.  During the remedy hearing, he was
willing to listen to all the reasons why Microsoft couldn't, or
shouldn't be broken up, but Microsoft wanted to argue with the Judges
"Finding of Facts", and were trying to re-argue the evdience and
rulings of the judge.  In effect, they were saying "Judge, you are an
idiot, and you don't understand anything about this case", much like
many of the WinTrolls here on COLA.

Judge Jackson knew that a forced divestiture would be nearly
impossible to actually get, and that the Appeals court or the Supreme
court would probably block the forced divestature.  What he tried for,
is an "Interim" remedy that would help Microsoft to a path similar to
the path IBM had taken, where they could voluntarily make their
departments more autonomous, for example, producing applications for
Linux and Unix as well as Windows, and Windows marketing that would
allow OEMs to provide more selection of applications.

To be sure that Microsoft had favorable treatment, after the final
rulings were written and turned over to the clerks for the legal
precedents and other research, Judge Jackson told a reporter that
Microsoft's executives were "Criminals" and should be prosecuted under
criminal law.  Clearly, he never wanted to see another Microsoft case
again.  Legally, his statement was actually quite accurate, based on
the sworn depositions presented in evidence, and even worse, the
exhibits and testimony of the DEFENSE Witnesses, who not only admitted
to criminal acts, but attempted to justify the criminal acts as
"Corporate Self Defense".

During the 2000 election, early in the primaries, Microsoft made a
substantial money-laundered contribution to a candidate named George W
Bush, which resulted in a campaign fund that pretty much assured that
he would become the nominee for the Republican Party.  Very early in
the primaries he started saying "Companies should be allowed to profit
from their technology".

Al Gore was clearly committed to continuing the prosecution of
Microsoft, and would have probably pushed for Divestiture or at least
VERY STRICT oversight by a very hostile compliance officer who would
have a large full-time staff   But Al Gore lost the election.

George Bush took over the case, and the first thing he did was
announce that "Divestature was off the table", then Judge Kollar-
Kotelly told Microsoft "You really should make every effort to reach a
settlement", it was almost implied "If you don't, I'll throw the book
at you".  Bush and John Ashcroft bent over forwards and backwards to
give Microsoft an offer they couldn't refuse.  The Compliance officer
was a big fan of Microsoft, and was assigned to the MARKETING
department.  They chose a Microsoft fan for the DOJ representative to
the technical comittee, and took Microsoft's top choice for the third
member, assuring that the technical committee that was supposed to be
policing Microsoft would to as little as possible.  In fact, they
essentially killed all complaints raised against Microsoft.  I think
the Compliance Officer just sat on his butt for 7 years.

> | mark at ellandroad dot demon dot co dot uk                           |
> | Cola faq:  http://www.faqs.org/faqs/linux/advocacy/faq-and-primer/  |
> | Cola trolls:  http://colatrolls.blogspot.com/                       |
> | Open platforms prevent vendor lock-in.  Own your Own services!       |

Too many goodies in this signature to cut it out.

Rex Ballard

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