Hollow Victory 

[Warning!  This article is about mature business policy decisions in the software world.  If you dislike companies or people because they are wealthy or if you are any other variation of the species "Crybabious Whinealotus," stop reading this article immediately and wash your hands vigorously.  If you want to read an article that is entirely made of opinions about damages that may occur to the computer industry based on events suggested during the course of the MS anti-trust trial, read on.]

Hardcore gamers around the world are undoubtedly aware of the major events in the Department of Justice's antitrust case against Microsoft.  For those who missed it, I'll provide a summary as best as I can remember: Judge Jackson, Janet Reno, Janet Jackson, Robocop, and the Justice League of America all claimed that it was "a victory for consumers" to call Microsoft a monopoly.  In reality, consumers are likely to be slammed pretty hard.

Why would this be?  Check out some of the wackier penalty proposals that have been leaked over the duration of the trial.  This is not an exhaustive list, but it should be enough to cause panic for anyone who owns a business or cares about the industry:

1) Package competing products with Windows
2) Make MS's hold on Windows source code rights a bit looser
3) Break Microsoft into smaller companies based on their separate departments

If any of these options are taken seriously by the court, it'll be another case in the long line of examples that prove laws about technology should only be issued by people who know about technology.  I'll take each of these proposals in turn, and describe the horrible legal ramifications.

Earlier in the trial, when it was suggested that Windows might be bundled with Netscape and other internet software, Microsoft suggested this was a whole lot like packaging a can of Coke in every Pepsi six pack.  I agree.  Why should any company be forced to carry another's product?  

This is an insane business idea, and if it is actually instated in law, that will set a dangerous precedent.  Netscape might enjoy a good laugh at being bundled with Microsoft, but what would happen if a future CD didn't have enough room to keep the full Windows and Netscape on the same disk?  If the competing company gets to decide which programs go on disk, they'll provide the largest one possible.  If the courts decide on every single case, they'll be swamped in no time.

With a legal mandate to hold the competing products, publishers could be pushed to a second disk, but any company that's forced to print an extra disk for each product loses a bit off their profit margins.  That loss could easily take away from their advertising budget and give the competition an edge even more powerful than bundling a demo - and don't kid yourself if you think this kind of forced bundling wouldn't be abused with 200MB intro movies for text editor demos.

This is all well and good for the operating system, gamers might say, but how would it change video game publishing?  It's all in the recent definition of "monopoly."  You see, Microsoft was specifically declared to have an unfair monopoly on operating systems for Intel-based personal computers.  While the statement did continue on at length, the use of this comment is nothing short of an attack on every successful business in the United States.

It's not a real stretch for one video game company to say that, because Homeworld is the only full 3D tactical space fleet strategy game, that it has established a monopoly over that genre.  You can bet the next 3D tactical space fleet strategy game maker would *love* to let Homeworld carry a demo of their next product.  Then what if smaller shareware companies start suing each other, demanding equal distribution at the expense of the more successful shareware companies?  Trust me, if Microsoft gets slammed with this kind of forced bundling, game companies won't be far behind.  Jackson's findings of fact had terms of "unfair" monopolies that allow for narrow niche targeting and may keep lawsuits going for decades.

The other proposal, to let the Windows' "secret recipe" code lose it's status as a protected company asset shows just as little forethought.  Every programmer likes the fun concept of "open source" so programmers can learn by seeing each others' code.  For most businesses, however, it is useless because this sharing allows the competition to make a similar product very easily.  Windows is Microsoft's big seller, so a competing Windows emulator would cost them a lot in lost sales.

Part of the reason this sharing of code was suggested was to help Sun develop their Java software better.  I like the concept of multi-platform languages such as Java because it's a developer's dream to "code once" and run on every machine.  It's idiotic to expect Microsoft to render itself obsolete in this endeavor though.  Can you imagine the conversations Sun and MS must have had?  I sure can!

Sun:  Hello!  Our Java will help to eliminate the need for your billion dollar cash cow Windows.  Will you help us make your product obsolete and reduce your revenue?

MS:  Of course we will.  We love helping other companies to destroy our own.

Sun:  Wait!  You're not helping us at all!  You're actually preserving the need for your own product!  Why would you do such a thing!?!  I'll tell Janet Reno on you!

Again, you'll ask how the greater spread of Windows source code could hurt the gaming community.  Well if it was released as open source, GNU, or even for (what the Justice Department considers) a reasonable fee, there could be hundreds of flavors released for variants of the same Windows product.  If you thought Sun had a hard time getting Java to work on one Windows OS, wait until there are more - and with a best-selling product like Windows, there will be hundreds of variations.  Forget "code once!"  PC game developers will dream of the days when their only target platforms were Linux, Macintosh, and Windows 95/8/NT.

Of course the big idea that everyone on the news loves to consider is whether Microsoft will be broken up and how that might happen.  The classic precedent is the case against the Bell telephone company, when a monolithic and powerful phone company was split up into several fledgling companies that charged consumers more money for lesser service.  Ask your elders about this one, and many will tell you they'd rather Bell stayed together.

Despite the hatred that some have against Microsoft, the destruction of a company is not a favorable outcome from a DoJ ruling for anyone.  MS has ultra successful publishing, ultra successful hardware, and ultra successful software.  What would happen if the company broke up?

It certainly wouldn't shrivel up like AT&T's lesser children did.  Instead of having one giant company that dominates the field, the split Microsoft will have several baby Microsoft's that each dominate their respective fields.  By licensing games like Age of Empires, and FASA properties, they're sure to publish hits.  By making the OS that runs on the most popular hardware and runs the most programs, their software sales will remain just as high.  By making products like the mouse with "intelli-eye," they'll keep selling hardware.  It would be like a reverse-Bell, where the breakup would cause each individual part to become super-strong on its own, because none of the divisions would be forced to spread their resources out on anything but their own market segment of games, OS development, hardware, etc.  It'll be nothing more than a slap at Gates and a couple of product name changes until their products get to sell too well.  Then they might have a monopoly on the sale of two button optical mouse products, and the anti-trust case can begin again.

These are likely effects of hasty punishment.  There is no benefit to the consumer, and all these legal precedence's will hurt businesses in the long run.  The use of a niche definition of "monopoly" is an especially grave cause for concern, but the DoJ's ignorance of the software world's realities is just as disheartening.  The laws they'll pass for one company will apply to others, and Soviet Russia taught us as much as we need to know about government meddling in business affairs.  Judge Jackson's "findings of fact" weren't a victory at all.
 

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Copyright 1999 - All rights reserved Hilbert Hagedoorn