Read Online Bill Gates by Jonathan Gatlin - Free Book Online Page B
Authors: Jonathan Gatlin
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frugal manager, and had turned around a struggling Novell when he was brought in to run it in 1982, at the age of fifty-eight. Gates had managed to block Novell’s attempt to purchase another software company, Aston-Tate, in 1988 (Aston-Tate was later bought by Borland International, in a disastrous deal that ran up Borland’s debt). Still, Noorda had been willing to talk when Gates had approached him about a possible merger between the two companies in 1991. Novell was the top dog in the business of producing networking software to link computers to one another, an area that was a real weakness for Microsoft, but one that Gates had great interest in and would continue to move forward on. But the deal with Novell was called off by Microsoft, and Noorda came away from the experience convinced that Gates had only been interested in getting a look at Novell’s inside workings and information.
Kahn and Noorda were thus both delighted to assist the Federal Trade Commission in its investigation of Microsoft’s business practices during the first half of the 1990s. The FTC’s interest had originally been aroused by the IBM/Microsoft agreement to develop OS/2 together, which immediately got antitrust noses twitching. When that agreement ultimately fell apart, the FTC had so much information on Microsoft and had received so many complaints about the way it operated from competitors that it kept right on investigating. Antitrust cases are always extremelycomplex, and, in a new field like computers, the law is often only vaguely applicable. But there were two main areas that the FTC was looking at. The first had to do with Microsoft’s agreements with the computer manufacturers, which gave them large discounts on the use of Microsoft DOS, provided a royalty was paid to Microsoft on every computer, regardless of whether it had DOS installed on it. Why, the question was asked, would a PC maker ever install an operating system from a competitor when it was already paying for DOS? The second main area of concern stemmed from complaints from competitors that, contrary to regulations, they did not receive the information they needed from Microsoft on new operating systems in a timely fashion that would allow them to develop their own applications systems that work with, for example, DOS for Windows. There was a suspicion that the Microsoft applications division was getting such information first, giving it a head start, despite the fact that regulations required competitors to receive it at the same time.
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G iven the amount of mud people have thrown up on the wall to see if it sticks, I think it’s pretty amazing that not a speck of dirt has ever stuck.
—B ILL G ATES , on competitors’ charges that Microsoft is ruthless, 1993
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Raymond Noorda was leading the charge against Microsoft, with as many as seven lawyers active in the case, but Borland and several other companies also tried to sway the FTC commissioners to take action against Microsoft. Although the general public was largely unaware of what was going on—FTC investigations are far too complicated for the sound-bite reporting of the evening news programs, and get reported only when a case comes to a head—the Wall Street Journal and the business pages of other leading newspapers followed the case closely. James Wallace gives a lengthy after-the-fact treatment of the matter in Overdrive , but it became a story with an anticlimactic ending. On February 5, 1993, the five FTC commissioners met to take a vote on whether action should be taken against Microsoft,and with one commissioner recusing himself because of a conflict of interest, the remaining four split evenly. The matter was taken up again, after further study, on July 21, 1993, with the same result. The Justice Department’s Antitrust Division then took the unusual step of getting involved.
----
I t’s fine for the antitrust authorities to look into what is a very important industry and
Kahn and Noorda were thus both delighted to assist the Federal Trade Commission in its investigation of Microsoft’s business practices during the first half of the 1990s. The FTC’s interest had originally been aroused by the IBM/Microsoft agreement to develop OS/2 together, which immediately got antitrust noses twitching. When that agreement ultimately fell apart, the FTC had so much information on Microsoft and had received so many complaints about the way it operated from competitors that it kept right on investigating. Antitrust cases are always extremelycomplex, and, in a new field like computers, the law is often only vaguely applicable. But there were two main areas that the FTC was looking at. The first had to do with Microsoft’s agreements with the computer manufacturers, which gave them large discounts on the use of Microsoft DOS, provided a royalty was paid to Microsoft on every computer, regardless of whether it had DOS installed on it. Why, the question was asked, would a PC maker ever install an operating system from a competitor when it was already paying for DOS? The second main area of concern stemmed from complaints from competitors that, contrary to regulations, they did not receive the information they needed from Microsoft on new operating systems in a timely fashion that would allow them to develop their own applications systems that work with, for example, DOS for Windows. There was a suspicion that the Microsoft applications division was getting such information first, giving it a head start, despite the fact that regulations required competitors to receive it at the same time.
----
G iven the amount of mud people have thrown up on the wall to see if it sticks, I think it’s pretty amazing that not a speck of dirt has ever stuck.
—B ILL G ATES , on competitors’ charges that Microsoft is ruthless, 1993
----
Raymond Noorda was leading the charge against Microsoft, with as many as seven lawyers active in the case, but Borland and several other companies also tried to sway the FTC commissioners to take action against Microsoft. Although the general public was largely unaware of what was going on—FTC investigations are far too complicated for the sound-bite reporting of the evening news programs, and get reported only when a case comes to a head—the Wall Street Journal and the business pages of other leading newspapers followed the case closely. James Wallace gives a lengthy after-the-fact treatment of the matter in Overdrive , but it became a story with an anticlimactic ending. On February 5, 1993, the five FTC commissioners met to take a vote on whether action should be taken against Microsoft,and with one commissioner recusing himself because of a conflict of interest, the remaining four split evenly. The matter was taken up again, after further study, on July 21, 1993, with the same result. The Justice Department’s Antitrust Division then took the unusual step of getting involved.
----
I t’s fine for the antitrust authorities to look into what is a very important industry and
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