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Technology Stocks : Novell (NOVL) dirt cheap, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Sir Francis Drake who wrote (32045)	5/27/2000 6:31:00 PM
From: zwolff	Read Replies (1) \| Respond to of 42771

Good post Morgan. There are no easy solutions. Here are some of the dangers: .. The odds are, therefore, that the judge will issue his ruling on remedies before the end of July. Whether he accepts the plaintiffs? proposals remains uncertain. But, for all Mr Neukom?s protests, it is hard to disagree with Mr Klein?s view that his plan cleaves closely to the court?s findings that Microsoft repeatedly and systematically broke the antitrust laws, both to maintain its Windows monopoly and to extend it to web browsers. Given the seriousness of Microsoft?s violations and the judge?s belief that these had a chilling effect on innovation, it would be surprising if he took a different view. As well as hoping to persuade Judge Jackson that a break-up would re-establish competition and have the great merit of being self-policing, Mr Klein is eager to see conduct remedies put in place now, which is within the court?s power. Without them, he fears that Microsoft is preparing to use the same old tactics to gain an unfair advantage in markets at the opposite end to its PC monopoly?industrial-strength servers and handheld devices such as personal digital assistants (PDAs). The DOJ believes it has evidence that Microsoft is planning versions of Office and other software that will run properly only on computer networks powered by the server edition of Windows 2000. Indeed, Microsoft?s critics say that the idea of NGWS is to create a family of Internet applications that are designed to work exclusively with Windows, extending from servers to PCs to PDAs and Internet mobile phones. The government cites an e-mail sent by Mr Gates in July 1999 that showed a willingness to change Office applications to favour devices that run on Windows, even if that damaged the interests of customers who rely on the ubiquitous Palm Pilot. This is an extraordinary insight into Microsoft?s refusal to restrain itself even under the most intense antitrust scrutiny. This kind of behaviour and power, in the DOJ?s view, makes Microsoft a unique company controlling a unique bottleneck. It has concerns about other recent Internet developments, such as the patenting of web business models and processes, or the potential for abuse by dominant business-to-business exchanges. But the DOJ dismisses the fear that a victory against Microsoft will be the prelude to an assault on other high-tech titans such as Cisco, Intel, Sun Microsystems or Oracle. None, it is convinced, not even a firm as dominant as Intel, which has had previous run-ins with antitrust enforcers, remotely resembles Microsoft. economist.com.

To: Sir Francis Drake who wrote (32045)	5/27/2000 11:21:00 PM
From: PJ Strifas	Read Replies (2) \| Respond to of 42771

My apologies for oversimplifying the case, the alternative was to write a book :) For the record, I don't think MSFT gained their position fairly nor have they fairly maintained that position either. Yes it's true their competitors have made some mistakes but I don't believe those mistakes solely allowed MSFT to gain their current market position (have you read "Hard Drive" by James Wallace?). You discount completely the biggest scam perpetrated in MSFT's rise to dominance in the OS market (the IBM OS/2 deal - remember that?). Apple's problem was not allowing OEMs to produce clones of their hardware - they wanted to own it all - big mistake. So MSFT has played an unfair hand to maximize on their position as well as competitor mistakes. Then again, this is not the first time in history a company has risen to the top of their industry in this fashion (or the last either). I do understand that monopolies are LEGAL. As far as I'm concerned they can continue to have that position but once they ARE a monopoly the rules change. I want to see those rules applied in the best possible manner for all. I find your arguement on a "tax on MSFT" far too loaded with arrogance. Oh poor MSFT that everyone has targeted them as MSFT so often targeted their competitors. Let's face it, there's not one company out there that can create a great app and not look over their shoulder for MSFT to come down and possibly crush them solely because of the market position MSFT enjoys! MSFT not only has the warchest capable of sustaining themselves without charging for a product, they have control over the very platform the competitor's product would NEED to run on to succeed! Forget Michael Jordan analogies here - he had pure talent to rise above the competition. We're talking about someone OWNING the court (it's maintainence and design) and changing it to affect the outcome of the competition! I am not proposing that MSFT be punished for being a good marketer or having a great product line BUT if they are leveraging their monopoly product to capture other markets - well, there needs to be some rules here no? If MSFT decides to create their own digital currency tomorrow and integrate it with their OS, what do we do? Do you see what I'm talking about? There's no chance for a company to create the next "killer app" without having MSFT co-opt that idea, integrate it into their OS, give it away for FREE (because they make ALOT of money from other products) and then squash the competition! You honestly want me to beleive that Netscape withered away solely because they made mistakes or were incompetent? Or that MSFT integrated their product into their OS forcing Netscape to give away one product which was integral to their revenue stream? [I know that Netscape originally gave away their browser product to seed the marketplace but when you're the innovator, you must first create the market before the product can become viable. At that point, MSFT scrambled to find a product - they purchased the original code from SpyGlass no? - then distribute it. They actually competed with Netscape at first but by their own admission, their only road to success travelled through their OS monopoly!] If as you say its natural for monopolies to arise then what to do with MSFT? Nothing? That makes me uneasy to say the least (and this could be said for ANY company even Novell if they were in a similar position). But it is true - their staying power is something to question at this time. Has time run out on MSFT's unbeatable reign? We don't know but we can make educated guesses. I do agree that the split is not the right answer as well. I've never advocated MSFT be split into smaller pieces - there must be a better way. Should they be forced to open the OEM agreements (exposing their pricing?) or should they be prohibited from "forcing" the bundling software (OS + Office) on new PCs? IMHO the consumer has lost already as the pawn in this grand play. Thanks for the lesson in economics :) Great post! Regards, Peter J Strifas