This report makes for interesting reading.
ccianet.org
Regards,
Peter J Strifas
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Report: Microsoft Is Building New Monopolies
By Mary Mosquera, TechWeb
Apr 19, 2000 (2:42 PM)
URL: techweb.com
Microsoft is replaying previous tactics, leveraging its desktop operating system monopoly to gain dominance in the server and computer networking markets, an industry group said Wednesday. "Microsoft recognizes the importance of the network market and is moving aggressively to control that market, much the same way it moved successfully to control the market for desktop operating systems and Internet browsers," the Computer and Communications Industry Association said in a white paper titled "Windows 2000: Blueprint for Dominance."
CCIA, which represents some Microsoft rivals, has been critical of the software giant throughout the antitrust trial. Sun and Oracle currently dominate the server market, where Microsoft (stock: MSFT) is making a concerted push with Windows 2000.
"The positioning, packaging, and business practices surrounding Windows 2000 lead Windows and Microsoft on an unmistakable and -- for consumers and others in the software market -- daunting course," the report said.
"The threat of Microsoft gaining server dominance by leveraging their desktop monopoly is real. By designing technological tie-ins, driving IT managers toward homogenous Windows environments, blocking competitive server operating systems through Microsoft proprietary interoperability, and requiring the installation of Windows 2000 servers to gain full use of the Windows 2000 desktop, Microsoft is replicating the tactics used to bring IE to dominance in the browser market," the report said.
A Microsoft spokesman said the report contained many errors. "This is nothing more than a partisan attack document from an organization representing most of Microsoft's major competitors," said Microsoft spokesman Mark Murray. "It should not be taken seriously," he said.
The report comes just as the U.S. Justice Department and 19 states are set to propose by April 28 remedies in response to a federal judge's ruling April 3 that Microsoft violated U.S. antitrust law. Microsoft will reply on May 10. U.S. District Court Judge Thomas Penfield Jackson has set a remedy hearing for May 24.
"Any remedy in the current Microsoft trial must effectively address the growing Microsoft monopoly in the enterprise market," said CCIA President Ed Black.
Windows 2000, released Feb. 17, and NT Workstation already account for nearly 20 percent of Microsoft's desktop operating system monopoly, CCIA said. "Microsoft's next target is clearly the server market, and their goal seems to be the same kind of monopoly control," the report said.
Windows 2000 Server is expected to bring in $3.5 billion in revenue in 2000 compared with an estimated $5 billion in desktop operating system revenue, the report said, citing analyst David Readerman, of Thomas Weisel Partners.
"Careful scrutiny and action must be taken to preserve competition and innovation in the server market and adjacent software markets," the industry group said.
The server market is intensely competitive, with Sun, Linux, IBM, and Microsoft, Murray said. "I don't think even our competitors could say with a straight face that the server market is not competitive," he said.
The Windows 2000 client is designed to work with a variety of servers from a variety of companies, including Microsoft's fiercest competitors, the Microsoft spokesman said. "We built the Windows 2000 desktop to work beautifully in a mixed environment, including all our major competitors' servers," Murray said.
Windows 2000 is the first time Microsoft has unified the operating system kernel and code for their primary desktop and server operating systems, CCIA said. To gain full functionality of the Windows 2000 desktop and server applications, including MS Office and BackOffice, end users must install Windows 2000 on both the server and desktop. This technological tie-in encompasses such popular applications as media streaming, Internet browsing, messaging, and Web page creation, the CCIA report said.
The software giant has also reduced prices to upgrade to NT Workstation, integrated streaming media into the operating system, invested in application hosting services, and acquired companies that make products that interoperate between Unix and NT operating systems, the report said.
Murray said it is not surprising that competitors were making bogus accusations. "They know the Windows 2000 server offers consumers a far better price and performance package than their servers," he said. |
