The problem with any requirement that MSFT not integrate its browser with the O/S is that you can always extend that argument to all MSFT software, which is clearly absurd. I, for one, agree it is BS to require the unbundling of IE. MSFT is 100% right in insisting on its right to innovate. This is of course different from illegally leveraging its O/S monopoly - this is a legitimate concern. Just how destructive the "unbundling" requirement could be across all MSFT software:
nytimes.com
<<SAN FRANCISCO -- The Microsoft Corp.'s power and influence in
the computer industry stems not only from its dominant Windows
operating system, but also from its office productivity software. And
on Monday, Microsoft will announce that it has begun retail shipments of a
new version of its office productivity "suite," Office 2000, that all but
eliminates the distinctions between a PC document and Internet data.
Office 2000, which includes word
processing, spreadsheet, presentation, data
base, e-mail, scheduling and other software
functions, has a long list of new features --
almost all of which are intended to give PC
users a set of software tools that deeply
integrate Internet capabilities.
At the heart of the integration strategy is
Microsoft's adoption of the World Wide
Web's basic document structure -- known as
HTML, for hypertext markup language --
intended to make it easy to publish
documents on the Web and perform what is
known as "round tripping," or translating
documents back and forth between Web and
traditional Microsoft Office formats.
"You're looking at the standard in the
corporate world," Amy Wohl, president of
Wohl Associates, a computer industry
consulting firm, said. "The program has an
enormous number of improvements in terms
of features and integration with Windows
and the Internet."
And, depending on one's perspective, the business strategy and product
capabilities of Office 2000 either underscore the urgency of the federal
antitrust trial that continues this week -- or make that trial even more
irrelevant. One of the issues in the trial is whether Microsoft's hegemony in
personal computer software has enabled the company to dominate other
parts of the software industry to the point of exercising illegal monopoly
power. Certainly, Office 2000 represents Microsoft's clearest example yet
of subsuming Internet capabilities into one of the company's dominant
desktop products.
In any case, the arrival of Office 2000 on store
shelves and in corporate offices this week will
very likely unleash a tidal wave of revenue for
the giant software publisher. Microsoft had
already begun to receive income as part of a
commercial test of Office 2000, including $400
million in the last quarter, which the company has
said it will report as revenue once the product starts shipping in volume.
Company executives said on Friday that they would not make any public
statements about preshipment sales. But Ms. Wohl said she had been told
that Microsoft had already received orders for 15 million copies of Office
2000.
Traditionally, each new major product generation represents a crossroads
for the software publisher, and industry analysts have repeatedly
questioned whether computer users will continue to have an appetite for
Microsoft's barrage of new features.
With Office 2000, though, Microsoft executives said, they were confident
they had addressed such concerns by insuring that Office 2000 documents
will be compatible with documents created using the previous version of
Office and by simplifying the program's control panel, or so-called user
interface.
"The best way to address the compatibility issue is by not having to change
anything," Steve Sinofsky, vice president of Microsoft's Office business,
said.
Sinofsky said the company had not tampered with Microsoft's existing file
formats except in its Access data base program. And in the case of
Access, he said, the company had tried to make the translation of data
seamless to computer users.
Despite such efforts, some industry analysts said computer users would be
forced toward a new dimension of complexity by the shift to
Internet-compatible documents.
"This is very sophisticated code and that's a troubling direction when you
think of the history of PC's as tools that empower individuals," Jeffrey
Tarter, publisher of the computer industry newsletter Softletter, said. "I'm
not sure you're empowering people when you turn a simple word
processing document into five pages of programming code."
The code, which controls the appearance of a document like a Web page,
is hidden from the user. The potential for problems arises if a user wanted
to manipulate the document in a way not anticipated by Microsoft's
programmers.
But Sinofsky said adding computer code to documents was not actually a
new approach. He pointed to the popular Adobe Postscript format, which
has long incorporated similar hidden complexity to give computer users
control over the appearance of their documents.
Microsoft executives also took issue with the widespread opinion among
industry analysts that it would be corporate users, rather than people who
use PC's at home or in small offices, who would find compelling reasons to
upgrade to the new program.
"The individual user will find Office 2000 useful because you can do things
you just couldn't do before," Sinofsky said.
He pointed to the ability to take pictures of one's children and publish them
on a Web site for viewing by grandparents as an example of the kind of
feature that would drive noncorporate users to the new product.
This newest product rollout continues a process of integrating application
programs that Microsoft began in 1990, when it introduced the first version
of Office, bundling together its Word, Excel, Powerpoint and Mail
applications. By 1993, with the introduction of Office 4.0, the integrated
program had become the primary product, as opposed to the individual
application programs.
That integration strategy proved to be the key competitive edge in its battle
to wrest the corporate market from companies like Lotus and, at the time,
Wordperfect.
Although the Justice Department has largely ignored the company's virtual
office-suite monopoly position in the current antitrust suit, the issue has
come up in trial testimony given by Avi Tevanian, the Apple Computer
Corp.'s top software executive.
In a deposition last year, Tevanian testified that Microsoft executives had
threatened to cancel development of Office 98, the Apple Macintosh
version of the Office suite, if Apple did not adopt Microsoft's Internet
Explorer as its primary Web browser software.
Microsoft executives responded that the government was twisting the
significance of its business negotiations with Apple.
Despite its control of more than 90 percent of the retail market for office
productivity software, Microsoft could find itself under increasing pricing
pressure from the Corel Corp., the feisty Canadian software publisher.
Corel, which acquired the Wordperfect brand several years ago, in April
began shipping a new product known as Wordperfect Office 2000. The
program has received strongly positive reviews.
Corel contends that it has 22 million users worldwide and said it was
focusing on its current customer base by simplifying and adding Internet
features to its new version.
"We still have a massive installed base," Jimi Smith, director of brand
management for Wordperfect Office, said. "These people have stuck with
us for a reason.
The entry-level version of Wordperfect Office has been selling for as little
as $79 in major chains like Comp USA, Smith said. In contrast, the
standard version of Microsoft's Office 2000 has a street price of $229.>>
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