EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS


OEM Tactics: Lessons to Learn from BeOS About GNU/Linux

Posted in Antitrust, Dell, GNU/Linux, Hardware, HP, IBM, Law, Microsoft, OLPC, Xandros at 12:41 pm by Dr. Roy Schestowitz

“I once preached peaceful coexistence with Windows. You may laugh at my expense — I deserve it.”

Be’s CEO Jean-Louis Gassée


NU/Linux laptops continue to arrive, but Microsoft is working hard to end this. It ought to be emphasised that ASUS has already said that it is now “tied up” with Microsoft [1, 2, 3]. ASUS is not the only one to have come under such imprisonment a relationship, but it incidentally spoke out about it. It’s the usual pressure tactics, whose goal is to have distribution of Linux curtailed or neglected.

There’s lots more to to speculate about. ASUS picked Xandros, which has some iffy past with Microsoft, never mind under the Corel flag.

More worryingly, have people forgotten that Xandros is a patent ally of Microsoft? In simple terms, despite the claims from the CEO of the company, ASUS is carrying a liability which can then be passed to users in the form of burden/cost that’s brought as incentives to Microsoft. This is extortion. Software patents are void in this case as nothing was ever shown.

OEM pressure tactics were covered quite extensively before, but a reader has sent us a pointer to the following strong message from 1999. We reproduce it below. The anonymous reader added: “Here’s an interesting comment with first hand experience about how hard it is to overcome Microsoft.”

Jean-Louis Gassée on why PC manufacturers don’t sell non MS products

* To: info-policy-notes <info-policy-notes@essential.org>
* Subject: Jean-Louis Gassée on why PC manufacturers don’t sell non MS products
* From: James Love <love@cptech.org>
* Date: Fri, 26 Feb 1999 12:05:55 -0500
* Organization: http://www.cptech.org
* Sender: jamie@essential.org

This important essay by Jean-Louis Gassée is a devastating
critique of the 1995 DOJ/Microsoft consent agreement and
a clear explanation to the barriers facing MS competitors
in the OS market.


Be Newsletter
Volume III, Issue 8, February 24, 1999

Crack in the Wall
By Jean-Louis Gassée

You’re the CEO of a PC OEM, delivering some great news to Wall
Street: “In an effort to offer greater variety and performance
to the customer, our factory now installs three operating systems
on the hard disk — Windows, Linux, and the BeOS. The reaction
has been spectacular. Customers love having a choice of OS, and
the press — from John Dvorak in PC Magazine to John Markoff in
the New York Times to Walt Mossberg in the Wall Street Journal –
has heralded us for our bold move. This is a great step forward for
the consumer and for the industry. Oh, and by the way, we lost
$50 million since we no longer qualify for Windows rebates. But it’s
a sacrifice for the common good.”

You’re now the ex-CEO of a PC OEM.

We know that the Windows rebate scheme exists — but what *is* it,
exactly? And why are so many OEMs afraid of losing it? Windows
pricing practices are closely guarded secrets, so we don’t know
exactly how the rebate is structured, but we can assume that it works
something like this: The total cost of a Windows license consists
of a base price offset by a rebate. The base price is set; the
rebate is flexible, and contingent on the “dedication” of the licensee.
That is, the more you “advertise” the product — through
prominent positioning, expanded shelf space, and so on — the
greater your rebate. This quid pro quo rebate looks innocent enough,
and can be a useful tool in a competitive market.

But when you’re running a monopoly — and when it comes to
out-of-the-box, consumer-grade PC clones, Microsoft *is* a monopoly –
“prominent positioning” and “expanded shelf space” have little meaning.
Microsoft has no interest in getting “more” footage on the OS shelf,
because they’ve already got it all. What interests them — the only
useful advantage they can “buy” (to be kind) with
their rebate — is to ensure that no one else will get any.

So how is “dedication” measured? A real-life example: We’ve been
working with a PC OEM that graciously — and bravely — decided to
load the BeOS on certain configurations in its product line. However,
there’s a twist in their definition of “loading.” When the customer
takes the machine home and starts it up for the first time, the
Microsoft boot manager appears — but the BeOS is nowhere in sight.
It seems the OEM interpreted Microsoft’s licensing provisions to mean
that the boot manager
could not be modified to display non-Microsoft systems. Furthermore,
the icon for the BeOS launcher — a program that lets the user shut
down Windows and launch the BeOS — doesn’t appear on the Windows
desktop; again, the license agreement prohibits the display of
“unapproved” icons. To boot the “loaded” BeOS, the customer must read
the documentation, fish a floppy from the box and finish the
installation. Clever.

One suspects that Linux suffers from the same fealty to Microsoft’s
licensing strictures. Linux is the culmination of 30 years of
development by the Unix community. Surely an OEM can’t complain
about Linux’s quality or its price: It’s good, and it’s free. If
Microsoft licensees are as free to choose as Microsoft claims they
are, why isn’t Linux factory installed on *any* PC?
If you randomly purchase 1,000 PC clones, how many have any OS other
than Windows loaded at the factory? Zero.

But what about all these announcements from companies such as IBM,
Dell, and others? A few URLs are supplied here for your convenience:


If you parse the statements, Linux is offered and supported on servers,
not on PCs. Another IBM story is that installation is to be performed
by the reseller on some PCs or laptops, not by IBM at the factory.

As an industry insider gently explained to me, Microsoft abides by a
very simple principle: No cracks in the wall. Otherwise, water will
seep in and sooner or later the masonry will crumble.

Guarding against even the smallest crack is important to Microsoft,
because it prevents a competitor from taking advantage of a phenomenon
that economists call the “network effect.” The “network effect”
manifests itself as an exponential increase in the value of a product
or service when more people use it. Applied to a computer operating
system, the effect works like this: As more people install and use an
OS, the demand for applications increases. Developers respond to the
demand, which attracts the attention of OEMs and
resellers, who promote the OS in order to sell the apps, which attracts
more customers… The key to all this is distribution and visibility —
in other words, “shelf space.”

Bill Gates understands the network effect well — he once quoted it to
me, chapter and verse. In the Fall of 1983, when I was still running
Apple France, I met with Bill in Paris and we got into a conversation
regarding the market share limitations of DOS. No problem, he said, with
the wide distribution we enjoy, we’ll get the attention of third
parties, and the marketplace will fix these shortcomings.

This puts statements by senior Microsoft executive Paul Maritz in
perspective. In reaction to my claim that Be wants to co-exist with
Microsoft, Mr. Maritz said (as quoted by Joseph Nocera in Fortune

“[Gassee is] articulating his strategy for entry into the
operating system marketplace. But on the other hand, I
know that Be has built a full-featured operating system,
so what I believe he’s doing here is outlining his
strategy about how he will initially co-exist with Windows
and, over time, attract more applications to his

Mr. Nocera interpreted Mr. Maritz’s interpretation thus:

“In other words, Gassee’s spiel is little more than a
trick intended to lull Microsoft. But Microsoft isn’t so
easily fooled! Microsoft will never ignore a potential
threat to its Windows fortress, no matter how slight. The
software giant may be in the middle of an antitrust trial,
but — as Andy Grove says — only the paranoid survive…”

[The entire article, part of a court house diary, can be found
at <http://www.pathfinder.com/fortune/1999/03/01/mic3.html>.]

Industry sages such as T.J. Rodgers, the CEO of Cypress Semiconductors,
as well as venture capitalists aligned with Microsoft, criticize the
Department of Justice’s intervention in the new Pax Romana we’re
supposed to enjoy under Microsoft’s tutelage. Don’t compete in court,
compete in the marketplace, they say.

I’m a free marketer myself; I left a statist environment for the level
playing field created by the rule of law in this, my adopted country. A
free market is *exactly* what we want. One where a PC OEM isn’t
threatened by financial death for daring to offer operating systems
that compete with the Windows monopoly.

We started with a thought experiment. We end with a real-life offer for
any PC OEM that’s willing to challenge the monopoly: Load the BeOS on
the hard disk so the user can see it when the computer is first booted,
and the license is free. Help us put a crack in the wall.

This is not a healthy state of trade, is it? Intel is constantly accused of using the same tricks and breaking the law.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

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. More Back Doors Found in Microsoft's Entrapments (Proprietary Software)

    Security flaws and even blatantly obvious loopholes for surveillance are identified in several of Microsoft's so-called 'products', which turn users (and their data) into the real product (to be sold to private companies or shared with spies)

  2. NASA Gives Back What It Took Away in the Form of Patent Monopolies for Private Gain

    Criticism of NASA's habit of clinging onto patents when it is actually the public which pays for everything

  3. The Coup D'état of Benoît Battistelli Follows an Imperialist Model, Threatens Opposition and Dissent

    SUEPO, the staff union, and boards that are independent from the EPO are both under attack and are constantly threatened by Benoît Battistelli and his goons

  4. Links 8/10/2015: Manjaro Linux Releases, Linksys WRT1900ACS, FOSS at NHS

    Links for the day

  5. Links 8/10/2015: KDE Plasma 5.4.2 Released, Linux Drama Queens

    Links for the day

  6. EPO Staff to Disrupt Administrative Council Meeting With Public Demonstration That Raises Awareness of Abuses

    The perception of collusion between the Administrative Council (AC) and the European Patent Office (EPO) leads to staff actions demanding investigation of illegal Board of Appeal (BoA) suspension/s (among many other things)

  7. OIN Turns 10, IDG Floods the Web With Puff Pieces That 'Normalise' Software Patents

    The Open Invention Network (OIN) commissions or helps produce puff pieces in the corporate media because it has an anniversary and corporate interests to push forth (including the idea that software patents can coexist with Linux)

  8. Hypocrite Forks the Linux Kernel Because of Cultural Characteristics That He Himself is Guilty of

    Forking of Linux is misleadingly reported in the media because of a couple of very loud people, who are not even quitting their jobs

  9. Željko Topić Attacks EPO Staff for 'Daring' to Legally Challenge the EPO's Management Over Its Gross Abuses in Europe

    Benoît Battistelli's right-hand man, Željko Topić, is under the false impression that yet more threats against staff of the EPO will help contain the crisis rather than further inflame it

  10. Media Reports Based on New Patents Suggest That Microsoft Continues to Attack Google and Android/Linux, Trying to Tax and Delete Android

    Reports and patent applications serve to show that Microsoft not only tries to infiltrate ("embrace") Android to put its apps there ("extend") but ultimately to delete ("extinguish") Android

  11. Commenters Provide Possible Explanations for Mr Van der Eijk Being on Unlimited Sick Leave

    Rumours are swirling around Wim Van der Eijk's absence, suggesting that he too may be a victim of Benoît Battistelli's iron fist

  12. Links 6/10/2015: Linux 4.3 RC4, HP OpenSwitch, Wind River Linux 8

    Links for the day

  13. With Software Patents in Europe (and Pushes for the Same Thing in Australia and India) Patent Trolls Now Come to Europe, Attack Android/Linux

    Worst-case scenarios are becoming a reality as Android backers officially attacked by patent trolls using standard-essential patents in London, England

  14. New Information on Limbo in the Enlarged Board, Courtesy of Illegal Actions by the EPO's Benoît Battistelli

    Battistelli's bullying of people whom he is not even allowed to bully turns out to have gone on for a lot longer than promised, and there is no sign of light at the end of this tunnel

  15. Microsoft Customers Complain About 'Inevitable' Vista 10 Because Microsoft Nearly Forces Botched 'Upgrades'

    In a desperate effort to spread Vista 10, sometimes even against people's will, Microsoft really upsets loyal customers, who are eventually eager to explore alternatives

  16. Dr. Ingve Björn Stjerna Explains Why the UPC (“Unitary Patent“ System) is an Undemocratic Sham Whilst UPC Silently Advanced by Patent Lawyers and Politicians

    European patent laws are being covertly overridden so as to allow broader scope of litigation, higher financial damages, speedy injunctions, and even software patents; the European public is intentionally kept in the dark about it, hence kept unable to express scepticism or issue truly effective objections

  17. IRC Proceedings: September 13th, 2015 – October 3rd, 2015

    Many IRC logs

  18. Article Explains Why SUEPO Went Silent Well Over a Week Ago: Nobody is Allowed to Talk to Journalists Without Permission From Battistelli

    More threats from Benoît Battistelli (threats of termination and legal actions on top of it) help hide the abuses of Battistelli and his fellow thugs at the EPO

  19. A Linux World: After Billions of Dollars in Losses Microsoft Changes How It Reports Financial Results

    The abusive monopolist is trying very hard to hide its growing difficulties, especially in an effort to bamboozle non-technical shareholders who cannot understand how Linux has essentially taken over

  20. Microsoft Continues to Extort Linux and Android OEMs Using Software Patents, This Time ASUS (Forced to Pre-Install Microsoft Spyware With OOXML)

    A roundup of news illustrating that Microsoft is still very much in a total war against Android, (mis)using federal regulators and even software patents to get its way

  21. Links 4/10/2015: Linux 4.2.3 , 4.1.10; MPlayer 1.2 released

    Links for the day

  22. Links 2/10/2015: Qubes 3.0, Linux.Wifatch

    Links for the day

  23. Microsoft-Connected Firm Net Applications Used to Mislead About Vista 10 Share and Mock GNU/Linux

    People who are connected to Microsoft (some being former staff) link to a firm that is connected to Microsoft in order to create the illusion that Vista 10 market share grew to 6.63%

  24. Chairman of the Enlarged Board of Appeal (EBoA) and EPO Vice-President of DG3 Suspiciously on Unlimited Sick Leave After Benoît Battistelli's Unprecedented Attacks on Other EBoA Staff

    Rumours suggest that Benoît Battistelli's affairs at the EPO may have something to do with Wim Van der Eijk's longterm absence

  25. Microsoft's Secret Special Relationship With EPO Illustrates Serious Corruption at Microsoft and the EPO

    A big story about the EPO and Microsoft working in a sort of collusion-type setup so as to serve Microsoft's patent agenda, which involves aggression, even against European software that is Free (as in freedom)

  26. Links 1/10/2015: LFS 7.8, Calculate Linux 15 Released

    Links for the day

  27. The 'Microsoft Loves Linux' Baloney is Still Being Floated in the Media While Microsoft Attacks Linux With Patents, New Lawsuits Reported

    Despite Microsoft's continued assault on Linux and on Android (using software patents, which it still discreetly lobbies for), some figures in the media are perpetually peddling the Microsoft-serving lie that 'Microsoft loves Linux'

  28. The Microsoft Botnet Goes Bonkers and ATMs Running Windows Spew Out Cash

    The terrible security (by design) of Microsoft Windows is causing all sorts of very serious and collectively expensive issues

  29. Black Duck Continues to Pile FUD on Free/Libre Software

    Having spent nearly a decade promoting the fear of Free software licensing, Black Duck now does the same regarding Free software security

  30. Links 30/9/2015: New Kernels, Nexus Devices

    Links for the day


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