Re: Draft the Outline of a New Consent Decree

[John Robert BEHRMAN <jbehrman@netropolis.net>]

  Behrman takes up the gauntlet and rushes forward gallantly, possibly also
  foolishly:
  
  W98:          IE4 - Love It Or Leave It
  
  Microsoft will surely be able to ship IE4 with, say, a W98 upgrade or OEM
  Release. I do not see the USGovernment suppressing technology. But, I
  expect the consent decree will force MS to include no-install and uninstall
  user options. I assume a plain, old file browser would be available for
  re-installation. Let me also predict that users will not like IE4 as a file
  browser/manager. There may be a really big opening for Norton Commander.
  IE4 and W98 could well prove top-heavy and capsize shortly after launch,
  even if Hillary Clinton herself cracks a bottle of champaign on the gold
  code.
  
  Tie-Ins:    Forcing A Trade-Off on MS
  
  If Microsoft effectively discounts export versions of W95 by not enforcing
  their policies on foreign governments or collecting royalty efficiently
  overseas, then I expect that one way or the other, outfits like Compaq will
  extract discounts from MS or opportunities to add more value by bundling or
  "optimizing" hardware and software suites as they see fit. This may come
  down to a tough decision for MS: To use its monopoly power, diminished
  onlly a little, to force tie-ins on domestic OEMs in order to push IE4
  installs, to enforce their WindowsNT quotas, or to keep a high, uniform
  price on W98. Microsoft's over-arching monopoly may, in fact, be an arch.
  Take out one little keystone, its power over the OEMs, and it may collapse.
  
  Integration:
  
  Absent tie-ins, a contractual and pricing problem, I do not think the
  USGovernment will or should preclude much of anybody integrating much of
  anything or not. The main problem here is that DOS/Windows is a huge,
  monolithic, 16-bit kludge. That is why MS invented OS/2 and, then, cloned
  VMS/Windows. Here, I think governments, state, national, and international,
  are going to have to insist on proper documentation of any and all 32-bit
  operating systems, as a matter of public health and safety. IE4 will have
  to work on a lot of 32-bit and even 64-bit platforms in regular ways. I
  believe that the USGovernment will uphold ISO/RFC metastandards. So, things
  will be integrated or not in regular ways at the 32-bit level and above.
  Maybe MS can maintain a monolithic OS/Browser. But, it will be Windows/CE.
  
  In sum, the Clinton Administration and Bill Gates will be talking about
  Win/Win:
  
       Windows98 will be packaged with a first-class Internet browser. But,
       it will have a file manager everybody hates. MS would make more money
       not bundling IE4 in consumer packaging, but they do not know that and
       the government is not obliged to tell them, if it knows or cares. IE4
       will be sort-of built-in but prove dysfunctional. The joke will be on
       MS.
  
       The DOS/Windows tie-in sale regime will have a notch taken out. It
       will crumble fast as DOS/Windows itself becomes increasingly archaic.
  
       Code integration at and above 32 bits will have to follow national
       standards of engineering practice and international standards of
       technical disclosures and documentation. Hardware companies can hold
       MS to these and have done so with NT, as far as I can tell. Such
       little market advantage as remains from more code integration will
       pale next to technical and legal risks of what Microsoft has long done
       with DOS/Windows grow as some power function.
  
  In Sum:
  
       Call it MS/USG 2:1. Let MS cry Victory!. I think that the USGovernment
       will get no more or less than what it asks for in the new decree. And,
       I think that is enough to move on to telephone monopoly, which is
       worth fighting over in real blood and treasure, not in X-Gen flaming
       and Baby Boomer spinning.
  
  In Other Words:
  
       Battle: MS - 2, USG - 1
       War:   MS - 0, USG - 1
  
       NIGHTLINE:                             Microsoft Wins!
       Chicago Board of Exchange:       MSQ 8 month calls down, puts up.
  
  
  
  
  
  
  
  
  
  
  
  John Gelles wrote:
  
  >         Will MS agree not to go ahead with Windows 98 as
  >         an integrated OS / Browser ?  I liked your guts
  >         in predicting -- but please be more specific on
  >         the two issues -- (1) tie ins, (2) integration.
  >         Will there be a condition -- like timing -- so
  >         in a couple of years when NCs are out there,
  >         MS can integrate if it wants to?
  >
  >         John -- Please answer to the List IF you make
  >         a prediction on these separate issues.
  >
  >         John Gelles                   email  address: myturn@vcol.net
  >         http://www.myturn.org   ;    http://www.rain.org/~jjgelles/
  >         URL's above seek enactment of an economic bill of rights.
  >
  > ----------
  > From: John Robert BEHRMAN <jbehrman@netropolis.net>
  > To: myturn@vcol.net
  > Subject: Re: Draft the Outline of a New Consent Decree
  > Date: Monday, November 10, 1997 10:39 AM
  >
  > I trust you have my prediction in IT'S ALL OVER and my subsequent
  > prediction that MS will spin up its stock price following the decision,
  > but that the stock price will subsequently decline, although not a lot.
  >
  > The heart of my prediction, however, relates to how the SEC treats
  > uncollected royalty and the USGovernment seeks to collect MS royalty
  > abroad. That will be hard to know publicly.
  >
  > John Gelles wrote:
  >
  > >         The great majority of writers to this List have it in
  > >         mind that Microsoft will or ought to be forced to
  > >         behave in certain specific ways with respect to
  > >         (1) licensing a Windows operating system suitable
  > >         for competitive browser and server products, and
  > >         (2) refraining from developing an operating system
  > >         that extends its OS into internet or other network
  > >         capability that competitors can well provide as
  > >         separate applications.
  > >
  > >         I predict MS will agree (and comply) with both of
  > >         these requirements as the only logical way to
  > >         protect         the internet from monopolization by the
  > >         owner of the de facto standard desktop OS.
  > >
  > >                   (The agreement may be conditional:  That is,
  > >         when markets defined as client and server internet
  > >         software for business and home, are demonstrably
  > >         no longer dependent on MS copyrighted operating
  > >         systems, because alternate OS products have a
  > >         substantial share of the market or alternative server
  > >         software creates a substantial market for network
  > >         computers that need no monopoly product, MS
  > >         would be free to develop fully integrated software
  > >         extending from the OS thru all network applications.)
  > >
  > >         Please make your prediction for the final resolution
  > >         of the present enforcement action -- for the record.
  > >         I want to save them to see whose will be closest.
  > >
  > >         John Gelles                   email  address: myturn@vcol.net
  > >         http://www.myturn.org   ;    http://www.rain.org/~jjgelles/
  > >         URL's above seek enactment of an economic bill of rights.