## 2007/05/19

### Microsoft, AntiTrust (Monopolies) and Patents

MSFT is threatening to Sue the Free World.
Patents are a state-granted Monopoly in return for full disclosure.
• Patents are useless unless defended.
• Patents are granted in a single jurisdiction at a time - there are no 'global' patents.
• Patents are uncertain until tested in court - by the full panoply of judges, counsel and mountains of paper.
• Patent 'trolls' and 'submarining' exist (and are legal tactics) - people who play the system for Fun and Profit. They hide out until someone is successful, then don't try to license their patents - but sue (for large amounts).
Microsoft may claim that code infringes its patents - but that's just a posture. If they were for real, they'd be launching court cases to decide the matter.

## Software Patents

Can Software really be patented?
Copyright exists to protect direct expressions of Intellectual activity.
Patents exist to protect the level up, how to make something.
Mathematical equations and algorithms are expressly excluded. [Why?]

Software that exists as binary code only, i.e. 'secret source', should not be protected by either copyright or patent. Because binary is nothuman readable (a necessary requirement for a 'direct expression') and by the same reasoning by patent - nobody can see what it's doing, nor confirm the claimed algorithm/process is used.

Binary software is protectable by 'registered designs' ['Design Patent' in the USA]. Unauthorised copying is an offence and easily testable.

Software is strictly an embodied thinking process. Source code is a) a human-readable expression and b) precise, detailed thinking steps. Programs have no life/existence unless they are executing.

Software is a brand-new type of intellectual property - thoughts-in-action. I'm exceedingly surprised that it can be patented. And monopolies are granted for 20 years at a time. [Used to be 17].

Because software is "massless" (and intangible), it can be distributed across the entire planet in under 30 minutes. The SQl-slammer worm is proof of that. Even if it is downloaded ordinarily, the channel can be up andrunning in minutes or hours [witness patch responses to virus/worms]and taken up/downloaded by the majority of users within a month...

And software is highly perishable - less than a decade on, you can't buy "Windows 98".

Give anyone a one-year head-start on "the field", and they have an effective monopoly for as long as they perform well. Witness Amazon and e-bay.

Software is different, very very different. It is a new class of Intellectual Property with completely different properties and timescales. The courts and government have yet to understand this and accommodate it, just as they have yet to accommodate 'Cyberspace' and the a reasonable jurisprudence there.

## Microsoft does have undisclosed Legal Liabilities

An InfoWeek article from 2006 quotes an Microsoft spokesperson: "In a sense you could say anybody who has got Linux in their data center today sort of has an undisclosed balance sheet liability".

Microsoft has a massive potentiallegal liability: "Fit-for-purpose" and "Merchantable Quality". This is a "turn out the lights and go home, immediately" problem for Microsoft- but doesn't appear in its Annual Reports.

What if the special 'protected' status of software, especially Operating Systems and general desktop tools, was taken away and the Consumer Protection organisations allowed to assess the quality/fitness of the product? Microsoft has for too many years gotten away with a bunch of unspoken implications:
• software is not that hard to write. Look what a bunch of undergraduate students knocked up in their spare time! Linux.
• system software is not inherently unreliable or insecure. That's a commercial decision and more reflects poor production practices.
• bigger is not better. Look at the original Unix and it's replacement from the same researchers, Plan 9. Full, functional and fast - and around one-tenth to one-hundredth the size of comparable commercial systems.
IBM showed for 20 years you could dominate the market with unexceptional product. Microsoft came along and showed you could do even better with poorly constructed product - and claim many devotees along the way.

If Microsoft was fully at effect of its actions, such as an internal I.T. department, it would focus on Quality and design secure, robust systems from the get go. 'BSOD' wouldn't be acceptable for internal users.
Since 1981, Microsoft systems software has lived in a consequence environment - they have never had to wear the cost to users of faults in their Operating Systems - time spent recovering from BSOD, virus/worm clean-up and lost and damaged files from inexplicable 'system crashes'. If Microsoft even had to pay $5 per avoidable incident taking over 30 minutes of user time, they be out of business 10 years ago. One Billion desktops is a huge amount of leverage. ## Why Smart Executives Fail Sydney Finelstein wrote on the Causes of failure - the sorts of mistakes that really smart, successful people make. More at the Dartmouth Tuck Business School site. Ballmer and Gates are not just smart, they are aggressive and exceptionally successful. They are easily the World's Best Marketers, ever! The simplest summation of Syd Finkelstein's book: Ego causes failures. BothBallmer and Gates have massive egos. Gates is probably more savvy - he's cashing in his MSFT stock - to the tune of 140M shares in the last2 years - for a cool$4,000,000. Ballmer, with 400M shares, has paper-value of \$10B. Very impressive. But is he too wed to his money, status and success? Is this why he is unable to hear and respond to the cries of pain from the Microsofties? Why a trickle of senior desertions is turning into a flood?

But what has worked in the past will not continue to work. "More of the Same" is not a recipe for sustained success. "Change or Die" comes into effect.

## Expectations

I think Ballmer has backed himself into a corner. At some point he will have to make good on his threats or lose all credibility. MSFT will be forced to sue - to resolve this matter once and for all. Or they might have the option taken away from them - What if the "Free Software World" surprised everyone and launced a pre-emptive strike and sued first?

And MSFT will fail, just as SCO has failed: PJ at Groklaw points that out much better than I.

Microsoft have become used to being the "300lb Gorilla" and being able to mostly do what they want. And in the world of desktop systems they have this power/position. But in the real world - the full commercial arena, they are just a big fish in a very small pond. They will lose -the forces/interests arrayed against them are a hundred-fold larger and have much stronger arguments and interests for Free Software.

At some point the USA Federal Government will be forced to choose: Microsoft or Open Source.

#### 1 comment:

Biby Cletus said...

Cool blog, i just randomly surfed in, but it sure was worth my time, will be back

Deep Regards from the other side of the Moon

Biby Cletus