The End of the Beginning

Microsoft probably thinks themselves very clever, having figured out a way to get revenue from GNU/Linux®. Their thinly veiled threats to sue, and to extract a fee for the right to use GNU/Linux®, seems to have borne fruit in that Dell is now buying SLES (SuSE Linux® Enterprise Server) licenses from Microsoft. However there are at least three silver linings to this development.

First, there will be the community reaction against Dell for having paid the extortion money to Microsoft. Dell will not sell very many GNU/Linux® computers this way. In fact, I was considering buying a Dell laptop with Ubuntu, plans that I will obviously now change. Dell misplayed its hand badly by so publicly supporting FOSS with their announcement that they would sell computers preloaded with GNU/Linux,® and then, once it had everyone in the FOSS world’s attention, buying licenses from Microsoft. In fact, it misplayed its hand so very badly, perhaps its goal was to mobilize the entire FOSS world against MS. Dell could take a page from Apple’s playbook, and say they didn’t want to buy the licenses from MS, but MS bullied them into it. Just like Steve Jobs did with his statement re DRM. Remember, Dell would rather like MS Windows to crash and burn–they would increase their profit share, and Dell would be more able to differentiate themselves in the post-MSWindows PC marketplace than most of their low-margin competitors. In any case, the community reaction will be a warning to the next PC maker: don’t do buy Linux® from Microsoft.

Second, Microsoft has, through many of its statements, made it clear that it believes it has some patents that could be enforced against the Linux® kernel. Balmer has been particularly ham-fisted in his comments, referring to the ‘Final Solution’ against Linux®, for example. These statements are not occurring in a vacuum, though. In particular, regulators and law makers in Europe have heard what Microsoft is saying about having some enforceable software patents against the Linux® kernel, and the window of opportunity to enact the software patent directive in Europe has slammed shut. Microsoft must have realized their actions would have this effect, and so it shows that MS knew that software patents in Europe were already a lost cause.

Third, there is a legal avenue that has opened up, with slander of title being perhaps one, but not the only, avenue that MS actions have opened up. But most exciting is certain actions in the EU that would center around the monopoly activities of Microsoft, and in particular EU rules on price fixing that uniquely apply to monopolies. The EU action against MS will get very interesting, and MS whole strategy is very questionable, in that MS appear to have deliberately cut themselves off from certain defenses early on. The arrogance of their filings is very telling, and they seem to believe that good old Uncle Sam will pull in some political favors/tricks to pull MS out of the trouble they are getting themselves into. I think they mis-overestimate Bush’s appeal.

In any case, the battle for the future of the PC is on, with MS being in a much worse position than it thought it would be in, with Vista out and not selling, the software patent directive effectively dead, the SCO litigation winding down, and GNU/Linux gaining traction. The next phase will see both Linux and Windows competing, with a very high probability that regional and market sector differentiation/fragmentation will occur.

This fragmented market will pose MS a very difficult question: to interoperate or not to interoperate? How, when and where they chose to interoperate will tell us much about which markets they are trying to defend.

The End of the Beginning

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s