12.23.07

Is Novell’s Pal Cooking the Books as Well? (Microsoft)

Posted in Bill Gates, Deception, Finance, Fraud, Microsoft, Novell, Vista, Windows at 6:50 pm by Dr. Roy Schestowitz

Microsoft’s taxation loopholes and system abuse; financial woes

A couple of weeks ago we pointed out that Novell is cooking the books, i.e. it moves money between buckets in order to embellish its results. It didn't work out too well.

There are rarely truths and more often we are blinded spin when it comes to big corporations. Microsoft is no exception. This post is intended to show that:

  1. Financially, Microsoft does not do as well as its media will have you believe
  2. Financial misconduct at Microsoft is quite routine

Several days ago, Microsoft declared its quarterly dividend.

Microsoft Corp. today announced that its board of directors declared a quarterly dividend of $0.11 per share. The dividend is payable March 13, 2008 to shareholders of record on February 21, 2008. The ex-dividend date will be February 19, 2008.

Tax Evasion and Deception

On the very same day, the Associated Press published an article about a Wisconsin bill that would address some tax loopholes.

Wisconsin Bill Would Require More Reporting on Tax Loopholes

[...]

A message left with Microsoft was not immediately returned.

We mentioned the Gates Foundation and gave some detailed information a couple of times in the past, or at least alluded to it. It is worth repeating and re-qoting the analysis of the Gates and Buffet Foundation “Shell Game”.

My background is finance and accounting. As a socially conscious venture capitalist and philanthropist, I have a very good understanding of wealth management and philanthropy. I started my career in 1967 with the IRS as a specialist in taxation covering many areas of the tax law including the so-called legal loopholes to charitable giving.

[...]

However, the Gates Buffet foundation grant is nothing more than a shell game in which control of assets for both Gates and Buffet remain the same.

[...]

The only difference is that the accumulation of wealth by these two will be much more massive because they will no longer have to pay any taxes.

This is seen as acceptable by some, but it’s rather obvious who loses the most . Itgoes well beyond the Foundation. Below we present two incident from the past few months alone:

1. Ecuador Tax Agency Closes Microsoft Branch Offices For 7 Days

“We have twice requested balances, payment reports and complete tax information, but the company hasn’t given it to us, so in accordance with our laws we have proceeded with the closure,” the SRI official in charge of the proceeding said.

2. Microsoft Office raid in Hungary

“Such behavior could lead to the exclusion of competitive products from the market and violate European Union rules, according to the authority known as the GVH.”

The example above is less to do with tax; it’s more about other types of practices. Other companies that came under fire for their financial practices recently inlcude Apple (Steve Jobs accused of turning a blind eye to predating) and Cisco in Brasil (massive case of tax evasion). Microsoft hasn’t escaped scrutiny though. Consider this article [expired]:

Microsoft’s past stock options practice poses questions

[...]

Microsoft in 1999 announced that it would end a policy of awarding options at monthly lows and said it would take a $217 million charge, though many details of that discontinued practice haven’t been widely known, The Wall Street Journal said Friday.

Those details raise questions about how Microsoft began the practice, what prompted the company to end it and whether the way the options were dated–at 30-day lows the month after they were granted–influenced other companies, it said.

Tough Life Where Cash Cows Are Absent

”Everywhere you look other than Windows and Office, business for Microsoft has been very tough.“Microsoft makes obscene amounts of money through sales of: (1) Windows (the consumer rarely has a choice); (2) support contracts; and (3) Office. The latter explains why the company has resorted to corruption in defending something which Microsoft says is a simple matter of its commercial interests, namely OOXML.

Everywhere you look other than Windows and Office, business for Microsoft has been very tough. Legal expenses — incurred due to retaliation for anticompetitive practices — have been huge (exceeding a billion dollars per year). Now, consider Windows Mobile.

Microsoft Hides Its Mobile and Business Apps Divisions

The company is folding its two worst-performing divisions — Microsoft Business Solutions (its business applications unit) and its Mobile and Embedded units — into the Microsoft Business Division and Microsoft Home and Entertainment units, respectively.

There are some more examples of this here:

The Secret Failures of Microsoft

There is no choice involved; even most Linux users are forced to pay for a Microsoft license in order to obtain a brand name PC.

[...]

They are bound to an oath to swear allegiance to Windows XP Professional and must never mention Linux and Windows in the same breath. If they step out of line in any way, Microsoft dramatically raises their OEM licensing fees and sends them to indoctrination camp, where they face chairs being hurled at them by angry monkeys.

[...]

Why do Windows enthusiasts exibit much hostility to an obvious fact? Because if they admit that 80% of the company’s revenues come entirely from an OEM tax, and not from any choice on the part of consumers…

[...]

Microsoft’s decade of investments in WinCE and Windows Mobile Smartphones have only barely matched the market share of Palm, which itself is a run down company out of ideas. Microsoft couldn’t out-maneuver the incompetent Palm within a decade of trying; now both are ineffectually fighting over the dying PDA industry while Linux and Symbian slaughter them in the smartphone arena…

Remember the XBox 360, which has already lost several billion of dollars rather than make money? Consider for example:

1. How Much is Too Much

Microsoft says it will stick with Xbox. But with years of heavy losses behind it, the pressure’s on for the gaming division to make good

2. Microsoft stoic despite massive losses

If you were to judge by the PR rhetoric, you’d think the 360 was an unstoppable commercial juggernaut. As usual though, PR lies.

3. Loot: Redmond, We Have a Problem, Or, What’s Wrong With the Xbox 360

At this point, Former becomes impassioned. That’s not fair, he says; we always saw this as a long-term venture. To which we reply that we were talking about the original Xbox, and while other divisions of the company throw off more profits in a single quarter than the entire $5 billion or so lost in the home and entertainment division to date, the fact remains that, as we take-our-word-for-it predicted, the Xbox group has been spectacularly unprofitable for Microsoft. Hence, our heretofore unpublished Vietnam analogy. The rest of the night is a blur, but we digress.

[...]

The worst case scenario for Microsoft, then, is one in which the Xbox 360′s bid for the mass market is blocked by the Wii for the next two to three years, at which point the aging and underpowered Wii gives way to a cheaper-than-it-is-now PS3 with a selection of AAA titles that’s far wider than what the PS3 has at the moment; new installments of Playstation’s own popular and casual-leaning games; and a slew of new franchises from Sony’s much-larger studio operation.

Of course, some of these colossal losses can be compensated for by sales of Windows and Office (among a few other profitable products).

Looking a year back, Microsoft’s relied on Windows Vista to save its day, but a major magazine has just named Vista the #1 tech disappointment of 2007. It’s hardly surprising and it’s also the cause for aggressive attacks against GNU/Linux and Free software. Here are some of these year-old articles, which also spoke about the company’s buybacks — a sign of great weakness:

1. Microsoft counts on Vista to recharge stagnant stock

There was a time in the 1990s when shares of Microsoft stock seemed to double every couple of years. 1996: college for the kids. 1998: a place on Whidbey. 1999: early retirement.

Times have changed.

2. A Dozen Stocks For ’07

Millen also thinks $36 billion in planned share buybacks will help the stock.

3. Commentary: Microsoft needs more than just buybacks to lift its shares

Microsoft shares, which have been dormant for the last few years, have been looking up over the last couple months. The Dow industrials component has gained about 20% since hitting a 4-year low of $21.46 on June 13.

To help move things along, Microsoft not only launched a $40 billion stock repurchase program that lasts through 2011, the company also said its previously announced 4-year, $30 billion stock buyback program was completed in just 2 years.

The following is an article from the Seattle P-I, which tends to be favourable to Microsoft. The article has been highly damaging. It claimed that Microsoft had lost over half of its cash pile in just 2 years. This happened quietly.

Software Notebook: Microsoft’s cash pile isn’t what it used to be

But Microsoft has taken a series of steps to reduce its cash balance. Specifically, by Microsoft’s count, the company has paid out nearly $100 billion through dividends and repurchasing its own stock in the past five years.

That’s just what the stock (MSFT) does not tell the complete story.

Adding Insult to Injury — Microsoft Vice President Resorts to Crime

Robert Bach really dropped the bomb when he resorted to inside-trading. He did this just before a technical and financial disaster was announced (the persistent denial had already lost consumer trust). Here are some articles about this:

1. Microsoft exec dumped stock prior to Red Ring announcement

To make matters more murky, the sales were not registered with the Securities and Exchange Commission within the mandatory two days of the transaction, a result of an alleged “administrative error.” Microsoft has since remedied the issue by following the “procedures required of late-filers.”

2. Microsoft’s Bach sold more stock before Xbox news

Microsoft Corp. executive Robbie Bach sold $3 million more in company stock during the period leading up to an announcement about a costly flaw in its Xbox video game console than previously reported, according to a filing Monday with the Securities and Exchange Commission.

3. Insider Trading Hasn’t Affect Microsoft Stock – Yet

MarketWatch.com reports that Robbie Bach, president of Microsoft’s Entertainment and Devices division, sold $6.2 million of Microsoft stock just prior to announcing that Microsoft was going to have to extend XBox 360 warranties to three years because of extensive failures. The filings note that this was not part of any scheduled diversification or selling program; this was a conscious, unscheduled sale by the guy in charge of releasing news that could affect the value of Microsoft stock.

[...]

Insider trading is a very serious violation of the law; just ask Martha Stewart, who served five months in prison for avoiding losses of $43,000 through trades that just had suspicious timing (no insider trading was actually proven). This is $6.3 million that went straight into Robbie Bach’s pocket.

Under normal circumstance, this guy would be investigated, maybe even jailed. Then again, don’t we already know that Microsoft is virtually above the law, lacking supervision of any kind?

Share in other sites/networks: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Reddit
  • email

This post is also available in Gemini over at:

gemini://gemini.techrights.org/2007/12/23/microsoft-dirty-cashy-secret/

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

What Else is New


  1. IRC Proceedings: Wednesday, March 03, 2021

    IRC logs for Wednesday, March 03, 2021



  2. The Free Software Foundation Should Re-add Richard Stallman to the Board

    Dr. Richard Stallman is missed by many who perceive him to have been wrongly treated; putting Stallman back in the Board (at the very least) would help the image of the Free Software Foundation more than the newly-announced work with Community Consulting Teams of Boston



  3. Free Software Calling

    Fewer people are willing to "put up with the shit" given by so-called 'Big Tech', seeing that it's mostly about social control rather than enablement or emancipation



  4. Meme: EPO Management Totally Gets 'Tehc'

    The bestest patent office in the whole wide world is besting the “hey hi” (AI) cutting edge; don't worry about exam and certification integrity



  5. The EPO's Software Blunders Are Inevitable Outcome of Technically Clueless Management Which Grants Illegal Patents on Software

    The "clusterfuck" which the EPO has become is negatively affecting not only EPO staff but also stakeholders, who sink into depression and sometimes anger, even fury, at great expense to their health; this is how institutions die (for a quick but short money grab, a culmination of corruption which piggybacks half a century of goodwill gestures)



  6. Links 3/3/2021: OpenSUSE Leap 15.3 Beta, GNU Denemo 2.5, and NomadBSD 1.4

    Links for the day



  7. What Free Software Organisations Can Learn From Australia's Rape Crisis

    Reprinted with permission from Daniel Pocock



  8. Microsoft Weaponises (and Further Spreads) Racism to Distract From Its Own Incompetence (and 'Five Eyes' Collusion for Back Door Access)

    Racist Microsoft is at it again; we're meant to think that China is evil for doing exactly what the United States has been doing but more importantly we're told not to blame Microsoft for shoddy code and back doors (classic blame-shifting tactics and overt distortion of facts, as we saw in the wake of SolarWinds backdoors)



  9. GNU/Linux News Sites Need to Promote Software Freedom, Not Binary and Proprietary Blobs Merely Compiled for GNU/Linux

    There has been lots of proprietary fluff in GNU/Linux 'news' sites so far this week; it merits an explanation or clarification, e.g. why we should generally reject proprietary stuff and instead promote Free/libre alternatives



  10. Links 3/3/2021: OpenSSH 8.5 and Absolute64 20210302 Released

    Links for the day



  11. IRC Proceedings: Tuesday, March 02, 2021

    IRC logs for Tuesday, March 02, 2021



  12. Links 3/3/2021: IPFire 2.25 Core Update 154, Red Hat Satellite 6.8.4, Kiwi TCMS 10.0

    Links for the day



  13. Links 2/3/2021: KDE Plasma 5.21.2, Qt 6.1 Beta, Refund of Pre-installed Windows

    Links for the day



  14. 'GatoKeeper'/IP Kat (AstraZeneca) Still Suppressing and Censoring the Public Views or Internal EPO Talks About EPO Corruption

    The suppression of comments critical of the EPO‘s administration (especially corruption scandals surrounding António Campinos and Benoît Battistelli) is a real problem; those ought not be a taboo subject in comments (where bloggers used to speak about those issues openly and regularly)



  15. Pocock on Removing Cognitive Bias Around Consent

    Reprinted with permission from Daniel Pocock



  16. IRC Proceedings: Monday, March 01, 2021

    IRC logs for Monday, March 01, 2021



  17. Links 2/3/2021: Maui 1.2.1, RSS Guard 3.9.0

    Links for the day



  18. ZDNet Really Hates Golang (Maybe Because Microsoft Does)

    The Golang programming language seems to be the target of intense FUD campaigns from sites connected to Microsoft, so it’s likely a bit of a Nemesis/endgame to Microsoft monoculture (unlike Rust, which Microsoft has already pocketed and is actively besieging to promote Microsoft monopoly and hardware monoculture)



  19. Links 1/3/2021: KStars 3.5.2, ET: Legacy 2.77, Flameshot 0.9

    Links for the day



  20. Five Years of António Campinos Coverage in Techrights (We Correctly Predicted His Presidency in March 2016)

    We've warned about António Campinos since March of 2016; well, António Campinos isn't just EPO President right now but he's also an oppressor who demonises the union of the EPO's staff



  21. In 2021 the EPO Works for Parasites Instead of Scientists (and It Cannot Even Hide That Anymore)

    Europe's second-largest institution is working for those who attack instead of create (or those who attack actual creators, with lousy and sketchy patents as ammunition)



  22. Links 1/3/2021: Manjaro ARM 21.02 and First Linux 5.12 RC Released

    Links for the day



  23. IRC Proceedings: Sunday, February 28, 2021

    IRC logs for Sunday, February 28, 2021



  24. On Gangstalking and Victim-Blaming

    Reprinted with permission from Daniel Pocock



  25. If the Web Can Be Increasingly Replaced (or Complemented) by Gemini and IPFS Etc., Then Large Monopolists Will Try to Dominate Those

    Monopolists and sociopaths won't be clapping and cheering for whatever stands a chance of replacing the Web (or Big Banks); if they ever embrace those replacements, it'll be to dominate and in turn undermine these



  26. Links 28/2/2021: Nitrux 1.3.8 and Kraft 0.96

    Links for the day



  27. Techrights Over 3 Internet Protocols and From the Command Line, Using Either Curl/Wget/Text Editor (Over WWW) or IPFS or Gemini

    A quick demo of how Techrights can be accessed without a browser, either over gemini:// or over http://



  28. The Command Line for Weather and Football Scores, Among Other Stuff

    A lot of stuff can be done from the command line and productivity (not to mention privacy) enhanced by automation and scripting over the Web (or even Gemini, as we shall show in a future video)



  29. You Know Gemini Space is Getting a Lot Bigger When You Need to Implement DDOS Protection

    Techrights is currently working on tools or programs that help detect and respond to DDOS attacks (or abusive over-consumption of pages) over gemini://



  30. The Fall of The Register

    A word of caution about The Register, a British publisher that nowadays does a lot of reputation laundering for Microsoft and Bill Gates (instead of news about actual technology, as opposed to clown computing, big brands, and oligarchs)


RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

Recent Posts