Microsoft’s deep pockets don’t buy deep friendships
Eighteen months ago, Microsoft and Sun announced an end to their legal sparring and a new phase of technical cooperation. The price of the 10-year peace agreement with Sun was nearly $2 billion. But, as the Beatles sang and Microsoft is learning, “money can’t buy me love.”
Recently, Sun has been cozying up to Microsoft nemesis du jour, Google. Sun will include the Google toolbar as an option to the nearly 20 million users who download Java each month. Google is expected to make it easier to download OpenOffice, Sun's open source alternative to Microsoft Office.
We can work it out
But if money can’t buy love, it can reduce legal bills. Microsoft paid out more than $6 billion in settlements in the last two years. And some of the companies that it settled with still have additional claims against the software giant.
Most recently, Microsoft put its U.S. antitrust troubles behind it by agreeing to pay RealNetworks $761 million. RealNetworks will stop pushing antitrust action against Microsoft in the EU and South Korea for bundling Windows Media Player with the PC operating system. But unlike the Sun deal, this may be the beginning of a genuine partnership. Microsoft will promote RealNetworks' music and game offerings on its MSN Web site and Xbox Live online game service. This cooperation is designed to put pressure on Apple, now the dominant company in digital music. Tellingly, Microsoft is so distrusted by the entertainment industry it was unable to get the four largest record labels to participate in its digital music subscription service.
Google in the crosshairs
A paper written by several MSN executives, was titled "Google -- The Winner Takes All (And Not Just Search...)." According to a Wall Street Journal report, the paper said "Google threatens Microsoft's position on the Internet, and could potentially lock Microsoft out of its existing distribution channels and reduce the value of Windows."
Determined to build a better search engine, MSN switched from using Yahoo to its own search engine last February. Since then, Microsoft's share of Web search queries in the U.S. has slipped, according to several research groups. But Redmond is famous for plowing ahead despite initial setbacks.
In an effort to slow Google’s momentum, Microsoft is in talks with Time Warner to buy all or part of its AOL division. AOL uses the Google search engine and, if it dropped Google for MSN Search, Google could lose as much as $380 million in AOL-generated advertising revenue -- one-quarter of its profit.
Not surprisingly, Google is fighting back. Google and broadband and cable TV giant Comcast are in discussions with Time Warner about buying a minority stake in AOL for as much as $5 billion.
Security blanket
In a move that may be welcomed by some consumers, but galling to many enterprises, Microsoft announced its intention to enter the anti-virus/anti-spyware market. Its plans for its yet-to-be-released OneCare, consumer-oriented PC security tool has already attracted the attention of regulators in the EU. Aside from the usual issues of unfairly bundling new applications into the Windows operating system, opponents charge that Microsoft’s rush to ever more markets caused it to release products that made possible many of today’s security risks in the first place.
The long and winding road
Microsoft recently celebrated its 30th anniversary. We don’t pretend to know what it will look like when it’s 64, or even if it will survive that long. Few IT companies have.
Eighteen months ago, Microsoft and Sun announced an end to their legal sparring and a new phase of technical cooperation. The price of the 10-year peace agreement with Sun was nearly $2 billion. But, as the Beatles sang and Microsoft is learning, “money can’t buy me love.”
Recently, Sun has been cozying up to Microsoft nemesis du jour, Google. Sun will include the Google toolbar as an option to the nearly 20 million users who download Java each month. Google is expected to make it easier to download OpenOffice, Sun's open source alternative to Microsoft Office.
We can work it out
But if money can’t buy love, it can reduce legal bills. Microsoft paid out more than $6 billion in settlements in the last two years. And some of the companies that it settled with still have additional claims against the software giant.
Most recently, Microsoft put its U.S. antitrust troubles behind it by agreeing to pay RealNetworks $761 million. RealNetworks will stop pushing antitrust action against Microsoft in the EU and South Korea for bundling Windows Media Player with the PC operating system. But unlike the Sun deal, this may be the beginning of a genuine partnership. Microsoft will promote RealNetworks' music and game offerings on its MSN Web site and Xbox Live online game service. This cooperation is designed to put pressure on Apple, now the dominant company in digital music. Tellingly, Microsoft is so distrusted by the entertainment industry it was unable to get the four largest record labels to participate in its digital music subscription service.
Google in the crosshairs
A paper written by several MSN executives, was titled "Google -- The Winner Takes All (And Not Just Search...)." According to a Wall Street Journal report, the paper said "Google threatens Microsoft's position on the Internet, and could potentially lock Microsoft out of its existing distribution channels and reduce the value of Windows."
Determined to build a better search engine, MSN switched from using Yahoo to its own search engine last February. Since then, Microsoft's share of Web search queries in the U.S. has slipped, according to several research groups. But Redmond is famous for plowing ahead despite initial setbacks.
In an effort to slow Google’s momentum, Microsoft is in talks with Time Warner to buy all or part of its AOL division. AOL uses the Google search engine and, if it dropped Google for MSN Search, Google could lose as much as $380 million in AOL-generated advertising revenue -- one-quarter of its profit.
Not surprisingly, Google is fighting back. Google and broadband and cable TV giant Comcast are in discussions with Time Warner about buying a minority stake in AOL for as much as $5 billion.
Security blanket
In a move that may be welcomed by some consumers, but galling to many enterprises, Microsoft announced its intention to enter the anti-virus/anti-spyware market. Its plans for its yet-to-be-released OneCare, consumer-oriented PC security tool has already attracted the attention of regulators in the EU. Aside from the usual issues of unfairly bundling new applications into the Windows operating system, opponents charge that Microsoft’s rush to ever more markets caused it to release products that made possible many of today’s security risks in the first place.
The long and winding road
Microsoft recently celebrated its 30th anniversary. We don’t pretend to know what it will look like when it’s 64, or even if it will survive that long. Few IT companies have.
