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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?


To: John F. Dowd who wrote (31574)11/3/1999 5:40:00 PM
From: John F. Dowd  Respond to of 74651
 
To All: Here is an excellent article echoing some of the posts on this board re: MSFT Open Source as A Remedy:

Open Source For Microsoft?
By Stuart J. Johnston
InformationWeek

There has been much brouhaha about open-source software lately, and a lot of companies have gotten on board one way or another. Among the joiners have been Netscape, Sun Microsystems, and IBM.

One company that you won't see on that list any time soon, I predict, is Microsoft--except perhaps in very limited situations--and for good reasons. Microsoft's applications and its operating systems are its key revenue producers, obviously. Not so obvious, however, is that when people think of Microsoft products, they rarely think about how much code contained in those products is actually licensed from third-party software companies--companies that may not want their code to be open sourced.

In fact, over the years, Microsoft has licensed lots of third-party code to include directly in, and with, its products. Just take Windows (3.1, 95 and 98), for example. TrueType screen font technology came from Microsoft, right? Wrong. TrueType was originally licensed from Apple. And remember all of those utilities that Microsoft bundled into MS-DOS 5 and 6, many of which are still bundled with Windows? Many of those were written by third-party companies and licensed to Microsoft.

In the case of DOS-level utilities, it would be pretty easy to extricate them since they are individual executables. In the case of more tightly integrated code, however, it is not trivial. Lest you immediately claim an exception--the U.S. Department of Justice's nifty demo wherein one witness showed how he could remove Internet Explorer from Windows 98--think again. The genesis of Internet Explorer began in December 1994 with the core browser code licensed from Spyglass. How do you disentangle changes that were made to licensed third-party code in order to produce a derivative product, i.e., Internet Explorer?

Why does it matter? Because Microsoft cannot place into open source, or the public domain, something it doesn't own. Many of the new file system features in Windows 2000 were licensed from third parties--everything from hierarchical storage and disk-volume-management technologies to tape backup facilities. Those are features that IT customers have been screaming for, but much of that code is buried so far inside Windows 2000's 30 million-line code base that you couldn't pick it out with tweezers.

That is not to mention any code that the third parties licensed to incorporate into their own products from still other vendors. All told, I doubt that even Microsoft's prodigious legal department, with its small army of attorneys, knows exactly which products contain which third parties' code--and I'm certain that the programmers can't identify it all.

Copyright and patent laws are quirky things. If Microsoft were to release Windows, for instance, as open source, it could jeopardize the copyrights or patents of any third parties who have licensed code or technologies to Microsoft. If you throw one thing into dispute--i.e., the validity of Microsoft's copyrights--you throw all the third-party code into the same predicament.

Now, before you go off and flame me, I do know the difference between open source and public domain. But the act of granting anyone the right to modify code and redistribute it may constitute an act that calls into question the validity of Microsoft copyrights and, thereby, any underlying third-party copyrights.

That sounds like a long shot, but stranger things have happened. Don't forget that the patents granted to John Mauchly and Presper Eckert, the team that designed the ENIAC computer during World War II, were later invalidated in a landmark court case partly because their ideas had been "published" in a mimeographed draft report written by John Von Neumann. Never mind that Von Neumann was not even involved with the ENIAC project, and that the document, known today as "the First Draft," was merely a draft report that was never officially published or distributed. Never mind that Mauchly and Eckert's work was classified for the war effort and they could not publish, and thus protect, their ideas. The court said, among other things, that the ideas embodied in ENIAC were published in the draft report and thus were relinquished into the public domain forever.

Additionally, beyond even copyright issues is the fact that all of the licensed third-party code contains what its developers believe are their own trade secrets, and licenses to such code ordinarily restrict the ability for the licensee to make those trade secrets public.

So suppose you are a bright engineer who, after years of work, comes up with a brilliant new way to speed up database processing. Rather than applying for a patent on the algorithm that performs the processing, you go with a copyright on the actual software, which gives you many more years of protection than does a patent. Also, suppose that you subsequently license your code to Microsoft, which then incorporates it into its Access personal database. Then, suppose that Microsoft goes open source with Access and releases the source code, thus letting all of your competitors see how you achieved your speed-up capability. Unless your competitor uses the same code you did, you would be hard pressed to prove infringement, and even if you could prove it, you'd be setting yourself up for a lengthy court fight. The natural thing to do would be to sue Microsoft for exposing your trade secrets in the first place--and besides, Microsoft has all that money in the bank.

Not that Microsoft is suffering any shortage of lawsuits these days, but that is one variety I believe it will try to avoid. So I predict that except for perhaps some very limited cases such as a standalone product that contains no third-party code, Microsoft will stay off the open-source bandwagon. There are too many ways for the company to get tripped up.

Likewise, I think it would be dangerous for Judge Thomas Penfield Jackson to order Microsoft to put its Windows code into the public domain, as proponents of that approach have suggested, to neutralize Microsoft's dominance. It would be impracticable, and would likely be grounds for a higher court to overturn such a ruling.

JFD