The Microsoft FUD Campaign vs. the Customer

by Nicholas Petreley

Almost everything that can be said has been said about the latest moves by Microsoft to create Fear, Uncertainty and Doubt (FUD) about Linux. Countless pundits and analysts have pointed out that Microsoft threats are toothless. Some have noted that Microsoft has singled out Linux and OpenOffice, the biggest threats to its monopoly on operating systems and office suites. Surely Microsoft could claim that the *BSDs infringe on similar patents if not the same ones. But the *BSDs do not pose as great a threat to the company. Others have pointed out that Microsoft would be insane to pull an SCO and sue its own customers. Still others have noted that IBM and/or OIN could respond to a patent war with a massive retaliation in patent infringement claims. I have no doubt that Microsoft has lifted a lot of GPL code (more likely algorithms) for Windows, which would prevent Microsoft from following through with its threats. To do so would require that Microsoft open its own code to scrutiny. The list goes on, and others have covered the angles very well. There is one perspective I haven't yet seen, at least not the way I propose to deal with it. This perspective follows below.

Sun, IBM, Microsoft, and Linux

I find it interesting to compare the history of Sun and IBM and how they handled (and how Microsoft is currently handling) their reversals of fortune. Jonathan Schwartz, CEO of Sun wrote a shockingly honest history of Sun's mistakes in this blog entry. Whether or not you take issue with anything Jonathan says in his blog, take careful note of this part, which mirrors what is now happening to Microsoft:

Our computer business had failed to keep pace with the rest of the industry - which meant our volume systems looked expensive. In combination, and with a poor track record of supporting Solaris off of Sun hardware, we gave customers one choice - leave Sun. Many did. Those were the dark days.

Where did they go? They went to GNU/Linux, a free and open source operating system built by a growing community, running on x86 systems. Why? Because the pair ("Linux on a whitebox") delivered, then, better grid performance, with more flexibility.

The Register story on Jonathan's blog entry points out an interesting response:

Jonathan, Ballmer and Gates can certainly use a few reality checks, but your [Jonathan's] vision of the world does as well. If you compare Microsoft's market capitalization and earnings growth to Sun's over the last years, it's quite obvious that what Sun is doing is not working.

Here's the problem with this response. For reasons about which I can only speculate, Sun did not turn on a dime. Sun's transition from a high profit-margin hardware and software company toward embracing free and open source software has been rocky at best, with many false starts. For a while there, it was one step forward and two steps back. Only recently have we seen radical new commitments to FOSS from Sun. Therefore it is premature to evaluate the value of Sun's commitment to FOSS based on Sun's current bottom line. It can take years for any business correction to pay off, so only time will tell if Sun discovers how best to profit from its new attitude. I suspect the best is yet to come, and unless Sun stumbles more or Microsoft turns itself upside down in the meantime, Sun will have the last laugh.

A lesson from IBM

The history at IBM is one reason why I am encouraged about Sun, encouraged about Linux, and predict nothing but trouble for Microsoft. Note carefully that Jonathan's comment is a confession that it was not delivering what customers want.

IBM, once known for its ruthless anticompetitive tactics, made the mistake (in terms of its philosophy at the time) of making the PC an open product. When it became obvious to IBM that it was losing truckloads of money to cheap clones of the IBM PC, IBM pulled another anticompetitive tactic by replacing the IBM PC with the Microchannel architecture (MCA) based PS/2. The PS/2 was a more closed system. People had to pay IBM for the privilege of using MCA. IBM attempted to make OS/2 run best (if not solely) on the PS/2. IBM made the mistake of trying to replace open systems with an architecture that would give it control over the market. People didn't buy into it, and the rest is history.

The failure of the PS/2 and OS/2, along with plunging profits prompted a catharsis for IBM. IBM began to endorse anything and everything customers want. People liked the idea of Java? IBM gave such strong support to Java that its next OS/2 convention focused more on Java than anything else. Sure, IBM still played around with possible ways to control the market, but nobody can deny that IBM went through a very radical transition period. IBM eventually saw the value in Linux, both on its own merit and as a way to undermine the monopoly of Windows, and endorsed Linux in a big way.

I'm not privvy to any internal meetings at IBM, but its actions reflected an attitude that IBM focused on what customers want, not on how it could gain or maintain control over any given market. And what do you know, IBM become a much more profitable company in the process. As profitable as it was when it abused its monopoly in markets? No, but the computer economy is changing. To quote Bob Young formerly of Red Hat, one of the goals of Red Hat was to take a $10 billion industry and turn it into a $10 million industry. That is precisely what is happening to the computer economy right now. That's the inevitable result of the increasing popularity of FOSS. Things are cheaper. Profits are lower. But it is still possible to be a successful company, and nobody can deny that the customer wins.

The Microsoft customer loses

Microsoft claims to spend billions of dollars in research and development each year. I'll buy that, but where is all this R&D going? I'm not privvy to the internal meetings at Microsoft anymore than I am the meetings at IBM. But can you really imagine this conversation at such a meeting?

"Customers are complaining that Windows isn't expensive enough. They're unhappy because Windows doesn't cripple itself if the operating system detects a piece of hardware that might enable them to bypass DRM. Customers are also clamoring to buy a new copy of Vista for every machine upgrade. We need to figure out a way to move closer to that goal, so let's find a way to limit the number of times you can switch hardware to one."

Think of it. It appears as if most of the work that went into Vista focused on license management, copy protection, and enforcement of DRM. Sure, it's pretty. But considering the hardware requirements for Vista to run its new interface, one might suspect Microsoft wrote Aero in Visual Basic. For all its faults, X11 still delivers more bang for the buck (or lack of bucks) with its built-in client/server architecture. And I can have all the 3D glitz I want without having to buy a Vista-capable machine.

Is it any wonder that Linux and OpenOffice pose such a threat to Microsoft? Vista represents Microsoft's biggest gap between what it has delivered and what customers want. The only long-term hope I see for Microsoft is for the company to engage in a turn-around similar to what IBM did. Whether or not that is possible is debatable, since Microsoft doesn't have the service-oriented foundation that IBM did when IBM changed its strategy. Nevertheless, Microsoft's R&D priorities are so misplaced as to be laughable. Vista is sure to be a success if only because it is pre-loaded on machines. But the consequences of Microsoft's disregard for its customers will catch up with Microsoft sooner or later.

The Bottom Line

The bottom line is that Microsoft's patent threat is a FUD public relations game. If there is any more to it at all, it is an attempt to offset its loss in profits by monetizing Linux and OpenOffice by collecting protection money from people who create and use FOSS. At worst, it is an attempt to stifle innovation in FOSS by creating an aura of fear that Microsoft hopes will infect FOSS developers. That is the most unlikely outcome of all.

So don't lose a moment's sleep over Microsoft's patent threats against Linux. Well, maybe a moment. Justice is not always served, and it is entirely possible that the worst could happen, and Microsoft could use its patent portfolio to impede the growth of Linux or collect a "tax" on every copy. But this is such an unlikely outcome that it's hardly worth consideration. Sleep well, and keep enjoying all of the benefits of Linux and FOSS.

Reversal on GPLv3

One final comment: I have been a strong critic of GPLv3 and also of the Microsoft-Novell deal. Now that the two issues intersect, however, I find that I must (at least tentatively, since the license is not finalized) reverse my position on the GPLv3. If the GPLv3 does not prohibit the freedom to use Linux and other FOSS in devices like TiVo simply because TiVo is handcuffed by the DMCA, and GPLv3 truely does throw a monkey wrench into Microsoft's plans to monetize Linux via patent deals in an effort to compete with Linux, then I am all for the GPLv3. Bring it on, and let's use it wherever appropriate and possible.