PC makers show their worst fears.
By Dan Goodin
October 24, 1997, 2:15 p.m. PT
news analysis Government documents detailing
Microsoft's hardball tactics bring into sharp focus a
PC company's worst nightmare: alienating the
Redmond empire.
On Monday, the Justice Department filed testimony
from Compaq Computer, Gateway 2000, and
Micron Electronics demonstrating that all three
companies were required to carry the Internet
Explorer browser as a condition of licensing
Windows 95. Two of those companies now say it
was the superiority of its products--rather than
alleged threats by Microsoft--that drove them to
make their decision.
Micron chairman and chief executive Joe Daltoso
issued a statement yesterday that a declaration
made by a manager at his company did not
constitute a complaint about Microsoft. And John
Rose, a senior vice president at Compaq, told the
Wall Street Journal that it was customer demand,
not a Microsoft letter threatening to terminate its
Windows 95 license, that drove his company to
offer Internet Explorer exclusively on the boxes it
sold.
Both PC manufacturers added that aggressive
negotiations are standard in the computer
industry--a perspective that analysts and Microsoft
itself are quick to confirm. But analysts add that
currying disfavor with Microsoft can put a computer
vendor (also called an original equipment
manufacturers, or OEM) out of business.
"[PC vendors] work on the assumption that keeping
good relations with Microsoft is a top priority," said
Dwight Davis, editorial director at Windows
Watcher, a publication that follows the industry.
"Clearly, some of these people who have had their
dirty laundry [with Microsoft] aired are doing all
they can to smoothe things over. There's sort of
revisionist history going on on both sides right now."
Micron may have special reason to worry.
According to the deposition filed by its manager,
Eric Browning, the company's Windows 95 license
expires next week. The company declined to
discuss whether it has renewed an agreement yet,
but an analyst who follows the Nampa, Idaho,
company says its needs all the bargaining position it
can get.
"Micron is in somewhat of a precarious position as
an up and coming second-tier vendor," said Roger
Kay, a computer analyst at International Data
Corporation. "They are not in a sufficiently
established position that they can do much
swaggering."
All three companies declined to discuss their
relationship with Microsoft, but a spokesman for
the Redmond, Washington, software giant said
there was no truth to analysts' assertions that
Microsoft inspires fear in its licensees.
"We view our OEMs as our partners, and we work
closely with them to meet their needs," Microsoft
spokesman Mark Murry said. He added that, while
the company requires vendors to ship the Windows
platform in its entirety, Microsoft in no way restricts
them from shipping the products of competitors.
"Customers want to know that Windows will run
the same on any computer, no matter who they buy
it from," Murray said. "What you see in the exhibits
is Microsoft basically informing our partners that we
do require that they ship our product in its entirety." |
