THE WARPED PERSPECTIVE
you shake hands with the Devil, you're bound to get burned." -- origin
Software developers have always walked a tightrope when it comes to profitability.
They seem to live on an exponential curve: if you never "turn the corner,"
you stay poor and eventually go out of business. If you can ever get a single huge
smash-hit product, you can make as much money as you want to. So it is only natural
that a for-profit software developer would choose the platform or platforms that
offer the greatest likelihood of reaching a mass audience. In the 1990s, that has
usually meant Microsoft platforms, particularly the Windows family of products.
Microsoft's management knows only too well how to leverage their monopoly position.
They move into new markets in a simple, four-step process:
1. They announce their intentions to promote a certain class of products, generating
consumer interest, advertising hype, and investment dollars.
2. They lower the entry costs into the new market segment by encouraging a large
number of software developers to write products that incorporate that particular
feature or capability.
3. When that niche market is "ripe" for the picking, they declare a "winner,"
buy them out or coerce them into capitulating to Microsoft, and flood the market
with free versions of the product (via download, preload, or bundling arrangement)
to force the alternative, competiting products out of business.
4. They close the door to new development by incorporating closed, proprietary "standards"
that disallow new developers into the now captive market.
So it is that companies who choose to develop for Microsoft platforms experience
boom-and-bust cycles. Netscape, for example, had a huge market share until Microsoft
decided to flood the market with a free internet browser they "bought"
from NCSA. They "bought" it by promising to pay a percentage royalty on
any Windows version they sold.... and then they refused to charge money for the
Windows versions. So NCSA got basically nothing for its Mosaic product, and most
competing (and future) browser makers were forced out of business as well.
This same pattern has been repeated numerous times with such applications as word
processors, spreadsheets, databases, and more. By using proprietary, closed file
formats, Microsoft locks-in customers and locks out developers once it controls
a sub-market of the software business. The response of competing software vendors
has been to either go out of business, or to move to a different niche and develop
a different product line.
Well, fine, there are plenty of other markets to go after out there, if you don't
mind starting over basically from scratch, having lost your customer base and the
concurrent income stream from your flagship product. But a new threat is now on
the horizon, a new Microsoft scheme which endangers even the ability to engage in
a survival-move to new market niches. What does Microsoft call this new scheme?
Yes, Microsoft, the purveyor of insecure products for uninformed people, has decided
to offer a diabolical tradeoff: Let us write software APIs that require any application
to be "pre-approved," they say. Let us build new Windows versions that
will only run application programs that have Microsoft-approved "signatures."
If you don't want viruses, they claim, you will have to give up the ability to run
"foreign" (competing) applications from "unknown parties" (new
What this means is that Microsoft wants to move the entire software-development
process, the entire software industry, to Step 4 above.
If Microsoft must pre-approve any software application on any Windows-based PC (namely,
90% of all new computers and pretty darn close to 90% of all computers already in
service), any vendor who does not conform to Microsoft's exorbitant demands will
be excluded from the software marketplace. Writing the finest applications in the
world will be of zero value if Microsoft refuses to grant you a seat at the table.
Microsoft will obviously use this security issue and their domineering control of
the software APIs to swallow the entire Windows application market down whole. If
users fail to recognize the "hook" in the Microsoft security plan, they
will lock themselves into buying only Microsoft-approved products from only Microsoft-approved
vendors. Innovators and entrepreneurs will be forced to go to Redmond with hat in
hand and beg (and pay) for a Microsoft security signature in order to gain access
to the software marketplace.
But this is a barrier to entry, which is the "signature" of a monopoly.
The fact that Microsoft is able to raise selective barriers to entry for the software
market, Linux notwithstanding, is proof positive of their monopoly status. Since
free software is not a commercial market per se, it cannot rightly be used as an
exception in an attempt to disprove Microsoft's monopoly condition. The fact that
Microsoft now proposes that it itself be the "keeper of the keys" means
that it is promoting itself as a de facto monopoly not just in operating systems,
but in the market for all Windows applications as well.
The only realistic solution for both providers of software and consumers of software
is to abandon the monopoly platforms and move to more open platforms that do not
have artificial barriers to entry. This is why OS/2 software vendors who have the
business savvy to prosper in a limited market continue to make OS/2 products: they
do not have someone raising barriers to eliminate them from their chosen platform.
They do not have to give up and start over every few years, so they can make money
on their original cash cows as long as they choose.
Let nobody be fooled by Microsoft's smarmy attempts at appearing to be a charitable
do-gooder. Microsoft's offer of a security signature regime upon the entire Windows
application business is nothing more than a cynical, greedy power-grab designed
to outflank the Department of Justice. Software developers who thought it was safe
to deal with Microsoft will soon find themselves nothing more than vassals and handmaidens
to King William if the marketplace decides to submit to the so-called "security"
It was only a matter of time. A leopard never changes its spots. And a monopolist's
stomach is never full.
Most recent revision: November 30, 2000
Copyright © 2000, Tom Nadeau
All Rights Reserved.