Summary: As Microsoft tries hard to artificially elevate its stock, more debt gets issued and there is potential for yet more to come
IN the previous post we showed technical inferiority at Microsoft but did not discuss financial problems. Microsoft receives some downgrades these days (a Standard & Poor’s analyst and Credit Suisse help Microsoft’s stock not at all), so it’s a mixed forecast. Microsoft has increased dividend only to see it being rather ineffective:
Microsoft’s Fatter Dividend Doesn’t Spur Buying Interest
Shares of MSFT will now have a dividend yield of 2.54%, based on the new dividend payout and last night’s closing stock price of $25.15. The stock has technical support in the $23-$24 price area. If the shares can firm up, we see overhead resistance around the $27-$28 price levels. We would remain on the sidelines for now.
There are some other companies that resort to stock buybacks right now. The Microsoft-friendly/funded press does its service to Microsoft by making it seem like wonderful news.
“I have seen companies go bankrupt, and latter be reborn, without debt.”
–ChipsA reader of ours, Chips, quotes an article as saying that “Microsoft intends to use the net proceeds from the offering for general corporate purposes, which may include funding for working capital, capital expenditures, repurchases of stock and acquisitions.”
“Yes, debt,” said our reader, “but look at the impending debt with this next article: ‘Microsoft Corporation (NASDAQ:MSFT) has raised quarterly dividends 23 percent to 16 cents per share. Microsoft Corporation (NASDAQ:MSFT) has raised quarterly dividend by 3 cents to 16 cents per share, a 23% increase, and has obtained approval from the board to sell additional debts worth $16 Billion.’”
“The way I read this,” remarked the reader, “is that MS has already sold 4.75 billion in debt, in addition to whatever debt they already have, and is planning more debt up to another 16 billion. I know it’s cheap for MS to borrow money right now. But one has to wonder, if they are really sitting on a pile of money, wouldn’t it just be cheaper still, to use that? And if they simply do not want to move money from one country to another, to avoid paying taxes, then doesn’t that imply that MS is not making money in some countries, or worse, perhaps avoiding taxes illegally?
“I have seen companies go bankrupt, and latter be reborn, without debt. Basically these were small companies, usually owned by a handful of people. They managed to keep all the machines they owned. Bankruptcy laws vary from country to country. I say it might be possible for MS to game the bankruptcy system in the future. Divisions can be spun off. Shell companies can buy divisions as well. All I am saying here, is not to trust MS with your money. This is a company without ethics.”
Another reader brought to our attention this older article which says:
Microsoft makes 60 percent of its profits on Windows, 60 percent on Office, and minus 20 percent on everything else, they said.
Sort of jibes with what some of the Microsoft financial services guys say—if you aren’t a developer or a salesperson, Microsoft doesn’t know what to make of you.
This may help explain why Microsoft keeps playing with the buckets, as currently confirmed also by the ‘Microsoft press’ (albeit with positive spin, as one ought to expect).
Regarding Microsoft debt, Microsoft's sympathiser Dina Bass covered it positively, as did Forbes which wrote: “Microsoft announced last night that its board had approved a 23% dividend hike, to $0.16 per share. The dividend is payable on December 9 to shareholders of record as of November 10.”
It’s an attempt to elevate the stock. This got covered also in [1, 2, 3, 4, 5, 6, 7, 8]. Here is how Microsoft claims to be performing (the debt is a misfit):
Microsoft (MSFT) offered $4.75 billion in AAA-rated bonds yesterday at rates nearing record lows. The software behemoth boasts an impeccable balance sheet with $37 billion in cash on hand against a minor $6 billion in strategic debt. Microsoft is a cash machine generating $24 billion in operating cash flow over the last 12 months. Given the company’s standing, investors would clearly be willing to accept very low yields. Yet, the pricing was still fairly astonishing given what it implies about expectations for economic growth.
One financial site asks, “Microsoft’s Higher Dividend: Will It Help?”
Another headline answers: “Citigroup Does Not Believe Microsoft’s Dividend Yield Will Double As Soon As Some Expect”
Mini-Microsoft writes about the company’s meeting. Some comments in this blog keep suggesting that more Microsoft layoffs are coming very soon [1, 2, 3].
Our dear reader Wayne has published the post “Microsoft Death Watch” (with this sequel). To quote a portion:
Last night one of my connections told me that Oracle is working really hard on the next version of Open Office. He isn’t close enough to the situation to have solid details, but he was told that Oracle is aiming to take Open Office from good, to fantastic. If Oracle manages to do this, it could do a huge amount of damage to Microsoft, as Microsoft’s main cash cow is Office. And of course ever office suite installation that Microsoft loses to Gnome Office, Google Docs, IWork, KOffice, OpenOffice, Word Perfect Office, and that other available alternatives has a major impact on profitability.
In the fall of 2009 I predicted that Microsoft would enter Chapter 11 Bankruptcy Protection in five years, based on my reading of their United States Security and Exchange Commission filings. That was before I was aware that Microsoft was in debt – my thanks to Dr. Roy over at Techrights for digging out this information. Attempting to fully evaluate Microsoft’s current financial health is difficult. The company regularly moves products from one division to another. While other companies also do this, in Microsoft’s case a lot of the moves appear to make to have no rational basis, leading me to believe that Microsoft is doing this to hide the true financial health of the company.
A key point is that Office 2010 sales disappointed to an extent [1, 2, 3, 4]. People just won’t pay much for yet another version of an office suite, at least not anymore. “It’s a “good article re: Microsoft Death Watch… exactly what I’ve been thinking of late,” said cubevector in IRC (
#techrights). The future is mobile/mobility and Microsoft does atrociously there, leading even to Slate/mobile/Courier-related departures and layoffs.
For those who think that Microsoft engagements in fraud are unlikely, one need only look back at financial misconduct, not just at Microsoft but also in Bill Gates’ Corbis [1, 2, 3]. Then there is the Samberg/Pequot scandal, which is very recent and Microsoft-involved fraud. Microsoft’s stock is how it got done, as covered previously in:
Here is an article from last week. It says more about the Pequot Capital scandal:
A former independent documentary filmmaker turned financial analyst, David Zilkha began working at Pequot Capital in April 2001, fresh out of his job as a product manager at the Microsoft office campus in Redmond, Wash. Educated at Oxford and Columbia universities, Zilkha wanted to enter investment management after working in the technology industry. He landed an interview with Pequot founder Arthur Samberg in January 2001.
The next month, Samberg e-mailed Zilkha, asking him for his current views on the software giant’s fiscal situation. Samberg said he was not impressed with his analysts’ research on Microsoft. That’s where Zilkha came in. In the first of several e-mails Zilkha wrote to Samberg, he replied, “The worst is over for Microsoft,” according to a SEC complaint. The next month Samberg bought a long position in Microsoft stock.
During the following weeks Samberg was buying and selling Microsoft stock based on conflicting information. He sold his long position because of predictions that Microsoft would fall short of its quarterly earning estimates. A few weeks later, however, he bought another long position when he heard good news about Microsoft’s latest operating system, Windows 2000.
In April, Zilkha was still employed by Microsoft. He got an e-mail from Samberg, asking for “tidbits” about Microsoft’s earnings. Zilkha told him to buy Microsoft stock as soon as possible. He then e-mailed coworkers, asking them about the quarterly earnings.
They told him Microsoft would meet or surpass its earning estimates. Zilkha relayed the information to Samberg. In April, just before the earning estimates went public, Zilkha told Samberg that the Microsoft chief financial officer seemed relaxed and that his disposition “augurs well.”
By the time Microsoft’s earning statements were released in April 2001, Samberg had bought 21,000 call options in the software conglomerate’s stock. A friend of Samberg also bought 300,000 shares based on his recommendations. Pequot’s Microsoft stock increased in value by $14 million. Samberg’s friend made $372,000 on his own trades.
It will not be too shocking if Microsoft too is doing illicit financial things given its track record. The thing is, it’s hard to allege this without concrete evidence and that’s how criminals like Madoff escaped scrutiny. The system discourages rather than rewards the inquisitive. █
“I have no special talents. I am only passionately curious.” –Albert Einstein
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Summary: An overview on the latest collapse of Microsoft services and Microsoft servers
A LOT OF Microsoft products are dying these days. Microsoft shuts them down to save money. Last night we wrote about the death of Windows Live Spaces and the day before that we reported that another product is said to be dead. If Microsoft is as cash-rich as it wishes people to believe (Microsoft actually has debt), why is it shrinking itself like this and approaching cheaper workers?
“Users of Windows Live Spaces will be migrated to GNU/Linux and finally enjoy decent uptime.”Microsoft’s problems are not just financial. The problem is that Microsoft’s products — broadly speaking — are well behind the competition’s. As Pogson put it (about the death of Windows Live Spaces): “Users will have a smooth transition to WordPress, the software running this blog. I hope this isn’t embrace, extend and extinguish in the blogosphere. Maybe bloggers are too intelligent and don’t drink the Koolaid.”
Users of Windows Live Spaces will be migrated to GNU/Linux and finally enjoy decent uptime. The downtime problems in Microsoft services such as BPOS are said to be “Design Issues”. Microsoft cannot produce a decent stack, so “Recently, M$’s BPOS which has a 99.9% guarantee was down to 99.7%,” claims Pogson. Microsoft had to issue some credits, which are like a lousy form of refund or compensation. Microsoft promises and guarantees can never be taken seriously.
In the next post we shall look at Microsoft’s latest financial situation. █
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Summary: Internet Explorer 9 (IE9) was Microsoft’s attempt to market Vista 7, but it finally turns out that Vista 7 SP1 as a requirement is utter nonsense and Microsoft puts further limits on how many people can install Vista 7
IE9 is a disaster in the making, despite the vast marketing campaign from Microsoft. The Internet Explorer team has just lost a key part of its leadership, which quit Microsoft to join Google. This could make chairs break because “Google Will Dominate The Browser Wars,” suggests some blogger who outlines the reasons.
Joe Wilcox, formerly a strong Microsoft booster, reports “mixed reactions to IE9″ and Microsoft just seems to be busy making a better logo rather than a better Web browser (which imitates the competition in many ways). Speaking of changing logos and copying Chrome/Firefox, watch this new article which speaks of “changing the Microsoft logo to a kitten”.
“Shame on Reddit for repeating Digg’s past mistakes…”IE9 hype is not real. It’s fabricated. For those who wonder, Microsoft made heaps of publicity for it using all sorts of stunts [1, 2] and payments. At the same time, Microsoft used IE9 to advertise Vista 7, e.g. [1, 2, 3, 4, 5, 6, 7]. It’s not as though Vista 7 was the only product advertised (brought to the headlines) using some test build of IE9 or anything else. Microsoft’s test build of an unattractive HPC product (already mentioned in here) was also accompanied by Vista 7 hype. Here is an example of similar PR with HPC, surely intended just to advertise Vista 7. Never underestimate Microsoft’s PR armies. At the very end Microsoft revealed that “IE9 won’t require Windows 7 SP1″. Was it the case all along or did Microsoft really “reverse course” as its booster claims right now? Microsoft had a lot to gain by adding allure to both IE9 and Vista 7, portraying them as exceptionally modern by mutual association.
For an understanding of the artificial hype around IE9, we ought to give examples. Lots of hype about download numbers (2 million or so, with AFP playing along) came after sneaky advertising in sites like Reddit. VentureBeat now confirms that Reddit was paid by Microsoft to do this: “Rival Digg’s botched attempt at a redesign and the announcement of a Reddit-inspired rally in Washington D.C. by TV personalities Stephen Colbert and Jon Stewart have bumped up the site’s numbers. Now the site has announced that the buzz has brought a new ad campaign from a very big client — Microsoft.”
Shame on Reddit for repeating Digg’s past mistakes (last mentioned 3 weeks ago). One our a readers, a regular in Reddit, wrote that it (language warning) “sounds like they’re going to lose their ABP exception entry then… also sounds like they’re going the way of /. [...] though the IE9 advertisement was thus far only in an article asking for information [...] we need a social news site that’s immune to m$, crApple and their zombies [...] i wouldn’t mind a “if you’re a m$ or crApple cultist, your ass is banned” policy on that site… i’m really tired of having to trudge through the shit posted by people without brains… and social filtering fucked up by such zombies… (not quite related, but) i stopped reading index.hu when they put IE9 ads at the top and bottom of every single fucking article… if they want to help m$ ruin the web again, fuck them… as for reddit, i’ll just wait and see”
We previously showed that Vista 7 adoption was relatively poor (Microsoft makes improper comparisons to hide this), so no wonder Microsoft tries using other products to spur Vista 7 sales. Here is the new story of someone who has just dumped Vista 7 and went back to Vista (Vista sales brought far more money to Microsoft than Vista 7 ever did).
So where did all of this get me? I upgraded a machine that met the specs for Windows 7 but that the manufacturer would not certify as Windows 7 ready. I ran the compatibility checker, which saw nothing insurmountable. It didn’t work out. Was it a bad idea to give it a shot?
“Not necessarily,” says Rudolph. “Most Vista-era computers will upgrade to Windows 7 very easily — the vast majority will.”
But not this time. Tonight I begin the process of restoring Vista. I sure hope this is the end of it.
Microsoft may have to invent some other reason/excuse for people to buy Vista 7*. IE9 just isn’t it.
What can a monopolist do? Well, Microsoft has begun limiting TechNet licences [1, 2, 3, 4], betraying some of its biggest supporters by doing so. As Pogson put it (in relation to this news), “You should use GNU/Linux. You can try as many installations as you want for the same low price, $0.”
Is Microsoft just trying to speed up its destruction? First they deny most Windows users a browser upgrade (then flip-flop) and now they limit the number of people who can use Vista 7. Times must be hard at Redmond and very soon we’ll write a post about Microsoft’s financial strains. █
* Vista also had such excuses made up, e.g. DirectX 10, which worked fine in Windows XP after just a little fiddling.
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Summary: The Business Software Alliance (BSA) is the latest Microsoft-funded lobby which is shown doing Microsoft’s ‘dirty work’ in Europe
THE BSA has a long tradition of lobbying for Microsoft on the subject of patents and standards. It’s just one of those front groups like the ones we mentioned a couple of hours ago.
Not so long ago there was a meeting at Westminster eForum and it was attended by Free software proponents, who were somewhat shocked to find it stuffed by Microsoft lobbyists that use almost the exact same talking points as Microsoft Florian and ACT (RAND proponents because it blocks Free software).
“They all use the same lobbying line, almost as though they study from common guidebooks.”The head of the FSFE, who is currently under attack from Microsoft Florian, said to me that “Two separate Microsoft reps pushed the same (F)RAND position at IGF week before last, plus BSA last Thursday.” He was talking about ACT’s appearance at IGF [1, 2, 3, 4] (ACT had three lobbyists in a row). “I couldn’t be less amazed, really. Just dimly sick. Arguments disqualify their proponents,” wrote Carlo Piana. They all use the same lobbying line, almost as though they study from common guidebooks. “This is like Florian mueller wrote it. Completely pro-M$,” wrote gnufreex regarding this new post about an older leak we covered in posts such as:
Anyway, among those who attended Westminster eForum there was Glyn Moody, who received a compliment when someone said he is “incredibly good at deflating nonsense w/o getting angry. Watch him dissect BSA’s standards FUD” (here are just portions of the post in question):
Last week I went along to the grandly-named Westminster eForum Keynote Seminar on Open source software: in business, in government. The good news was that it offered one of the best line-ups of open source know-how in the UK I have come across. The bad news was that the seminar’s venue was quite small and not even full: these people really deserved a much bigger audience. The poor turnout was a sad reflection of how far open source still has to go in this country in terms of mainstream recognition and interest.
Things began with Karsten Gerloff, President of the Free Software Foundaion Europe, giving a nice, gentle intro to all the basic concepts. There then followed a number of sessions, all of which had names that will be familiar to readers of this column.
For example, one on “Implementation and the costs of open source and free software” had fellow blogger Andrew Katz, as well as Alan Lord, Director of the Open Learning Centre (his speech is now online). Taking part in a discussion of “The challenges of deploying open source software in the public sector” was Mark Taylor, a tireless advocate of open source in business and government, and also a blogger here on Computerworld UK.
So once I had focussed my age-addled brain on the presence of the BSA at this event, I then re-read the title of the talk – “The European debate on software interoperability, openness and freedom of choice”, and noticed the words “freedom of choice”. I suddenly knew exactly where this one was going.
My impression was that Mingorance’s presentation depicted such RF licences and the software that required them in a rather negative light. The GNU GPL, for example, which is one of the main licences that cannot accommodate FRAND licensed-standards, was described by him as “IP-restrictive.” Since “IP” is actually a government-granted monopoly – and most people agree that monopolies are bad things – that’s like describing the police as “criminal-restrictive”: true, but a decidedly odd way of looking at things.
The trouble, then, is that BSA is inconsistent: it asks for “dogmatic preferences” to be avoided, with no “favour” being shown to “one software development model”, but fails to recognise that its own preference for FRAND, rather than RF, licensing is “dogmatic” in precisely this way, since it favours certain development models over others, like those producing GPL-licensed software.
So when it comes to creating level playing-fields through open standards, let’s avoid double standards. RF licensing discriminates against no one, and favours no one; it maximises the number of rival offerings and hence increases the overall competition. This allows customers to procure their software “based on functionality, performance, security, and cost of ownership”: who could possibly be against that?
Microsoft lobbies extremely heavily against Free software right now. Those who have not noticed probably don’t know Microsoft’s lobbyists. Microsoft rarely lobbies directly just as it rarely markets its products and stalks its opponents directly. We gradually map them. █
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Still all about monopolies
Traul Allen, photo by msprague
Summary: Reputation laundering follows massive patent scams spanning different areas of science and technology; identical tricks are used by 3 top Microsoft persons (with overlap between their operations)
ABOUT a month ago we produced and presented a factual case to show that Microsoft is a leading producer of patent trolls. Bill Gates plays his role with Searete, his patents pusher (pushing friends’ patents), and funding for a former Microsoft CTO, who is now inarguably the world’s largest patent troll. More recently it turned out that Microsoft’s co-founder Traul Allen also decided to enter the patent-trolling business and despite Todd Bishop’s obsession with these selfish people (Microsoft boosters have endless admiration for money-makers from Microsoft), anybody who know them personally can attest to their endangerment to industry and society at large. They just have a lot or PR operations going and that’s why people sometimes view them as “nice” people. It’s clearly a façade; That’s an observation that’s increasing being made by other Web sites too. Over the past few months we saw systematic grooming of the world’s biggest patent troll (and a bully too). Some of the latest Myhrvold grooming/PR comes from Seattle although there are others who did this PR routine last week [1, 2]. They promoted a cookbook along with Bill Gates (in his Twitter account). Nathan Myhrvold has resorted to PR like Gates did because just like Gates he is damaging society a great deal and the only way to hide it is to buy a lot of positive publicity and pretend/spin his actions as positive (or look at totally off-topic activities).
“Over the past few months we saw systematic grooming of the world’s biggest patent troll (and a bully too).”As for Traul Allen, the LA Times is looking into his case of massive trolling and it does not look good at all: “Departing staff members signed nondisclosure and non-disparagement agreements, which may explain why the inventors whose patents are listed in the lawsuit have not been heard to comment; of the 11 inventors on the four patents I was able to locate (out of 19 individuals), only two responded to my request for comment, one by politely begging off on the phone, the other by referring me to a website updating his latest work and pleading that he’s awaiting advice of counsel before saying more.”
Not so long ago Traul Allen too began his PR crusade. Those who are not immune to PR might actually fall for it and believe that the world’s richest people are also largest donators (not in absolute terms, never mind tax exemptions) and nicest people. Later in the week we’ll elaborate on it. Bill Gates, for example, is still getting richer. █
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Summary: The Free Software Foundation (FSF) successfully encourages many people to voice their opinion on software patents and the USPTO comes under pressure from other directions while unregistered lobbyists heckle those who drive progress
THE FSF’S Brett Smith, along with other people who support the FSF’s cause, has been calling for requests to be sent to the USPTO (first mentioned here), asking politely for elimination of software patents until over 450 submissions were sent:
Last week, we put out an action item asking people to write to the USPTO, and explain to them why software should not be eligible for patents under their forthcoming post-Bilski guidance. To answer the call, you all sent in more than 450 letters, offering the USPTO all kinds of legal and practical reasons why they should stop issuing software patents. This is a tremendous response, and we’re very grateful to you all for participating. Thank you very much!
Of course, we also submitted our own letter written by the director of the End Software Patents campaign, Ciarán O’Riordan. You can read it on the ESP site. We used this opportunity to point out three specific points in the Bilski decision that we believe seriously undermine any legal case for software patents. If the USPTO incorporates even one of these points into its guidance, it will be a big win for opponents of software patents.
The FSF must be doing something right because the hypocrite lobbyist Microsoft Florian, who is spamming journalists in the sense that without consent he sends a huge number of them identical E-mails (personalised for deception), called the FSF “spammer” for recommending that readers independently submit suggestion to the USPTO, which is run with/by their own government. The FSF — unlike the company Florian lobbies in favour — does not send fake letters with slight variations and fake names of dead people. But anyway, let’s digress and not pay too much attention to aggressive lobbyists whose mask has fallen and goals exposed a long time ago.
Here is Red Hat announcing its contribution to this:
Yesterday Red Hat has submitted comments to the U.S Patent and Trademark Office regarding interpretation of the Supreme Court’s Bilski decision.
The submission was made in response to the PTO’s request for public comments to assist it in determining how to apply the Supreme Court’s decision in that case. Although the Bilski decision did not expressly address the standards for refusing to allow software patents, interpretation of the decision will determine whether certain patents are granted. Thus the PTO’s approach to examining patent applications will have a substantial effect on the patent landscape.
Needless to say, the tireless lobbyist is already bombarding Twitter with smears against Red Hat (for working towards removal of software patents).
Over at Groklaw, where the lobbyist is banned, there is publication of another detailed submission to the USPTO [via].
This is more than enough evidence that physical devices and computations have the ability to represent abstract ideas. Their use is essential for human beings to even be able to conceive, let alone use, these ideas. In particular the computations described by algorithms must be carried out physically in order to be used at all. If you patent the physical means to carry out the computation then you may end up patenting the computation itself if you are not careful. This is the mathematical basis for the non-patentability of algorithms as per Benson, Flook and Diehr.
Remarking on a story we covered last week, TechDirt publishes “Patent Office Says Another ‘Worst Patent’ Should Be Rejected As Obvious”
“Groklaw notes that Trend Micro is now at risk of losing the patent monopoly it has been using to attack competitors”While not wasting its time in Twitter arguing with lobbyists for software patents, the FFII drew attention to this good old article about “How two lines of code can infringe on a software patent”
One Twitter user wrote: “Any of your patent practitioners noticing a high level of COURTESY at the USPTO? The “business method” /software examiners impress me!”
Groklaw notes that Trend Micro is now at risk of losing the patent monopoly it has been using to attack competitors [1, 2, 3]. This happened at the USPTO’s order, which sounds like an encouraging improvement.
The USPTO on September 16 issued an order granting Fortinet’s petition to reexamine the validity of the Trend Micro patent on antivirus functionality, the 5,623,600 patent, on the grounds that a “substantial new question of patentability” exists based on prior art now being considered. Fortinet publicly acknowledges the help of the open source community, specifically mentioning the prior art searching you guys did here on Groklaw in June. The ultimate outcome is yet to be determined, of course, and that’s in the hands of the lawyers now, but you guys did your part. It’s a great partnership, techies and lawyers, and I thank you for working hard on this, and I hope it leads to a just resolution.
Lastly, just for laughs, see the new article “Larry King bagel company sued over ‘patented water’” (it’s not a satire).
A new lawsuit answers three great questions:
1. What is TV and radio personality Larry King up to now that he’s bowing to Piers Morgan as host of a nightly CNN talk show?
2. Why can’t we get a good bagel outside of Brooklyn?
3. Can you patent a process for making water?
Obviously, the answers are connected.
In July, King signed on with the Original Brooklyn Water Bagel Co. as a franchisee and brand promoter. The company specializes in selling bagels prepared in water adapted to replicate the H2O of Brooklyn, N.Y. King would promote the brand and help develop the budding chain’s stores throughout the world, including, for those crying “dough” over the lack of tasty bagels in La-La Land, a store opening in Beverly Hills.
Unless the USPTO changes course, it is at risk of losing a lot of the legitimacy it has left. Reviewing the patentability of software patents would be a good start. “Success” is not to be measured in terms of the number of monopolies granted and only ever broadening their scope is a recipe for
Water Bagel disaster. █
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Microsoft front gets another makeover
Summary: CodePlex/Microsoft wolf in new sheep’s clothing; Free software luminaries are not foolish enough to fall for it
In order for Microsoft to speak on behalf of its opposition (Microsoft’s CodePlex does this a lot), Microsoft must pretend to be a friend of the competition. But who would ever trust Microsoft within the community it is ridiculing, extorting, and sometimes even suing? That is why Microsoft created all sorts of shells.
“It sent loads of fake letters from dead people, all in support of Microsoft. Then it got caught red-handed and lost legitimacy.”One good example of a Microsoft shell is ATL, which as a service to its funder Microsoft decided to speak ‘on behalf of’ dead people. It sent loads of fake letters from dead people, all in support of Microsoft. Then it got caught red-handed and lost legitimacy. In some countries, such behaviour might put Microsoft and ATL members in prison, but in the US ‘lobbying’ (often a euphemism for corruption) is quite routine and almost never punished for. Anyway, from the ashes of ATL came ACT, which is pretty much the same group accommodating some of the same people under a different identity, using a new name (deceptive acronym meaning the opposite of what it works towards). It’s a simple case of nymshifting and it happens not only to Microsoft front groups. Additionally, for extra credibility Microsoft tends to ‘buy’ those who are publicly perceived as Microsoft opponents; this helps Microsoft shut them up (Microsoft critics no more) and also poison or drain its pool of opposition.
Today we are seeing Microsoft engaging in yet another act of nymshifting. Having been publicly dismissed by many groups including the FSF, Microsoft’s vacuum for Free/open source developers (CodePlex) is moving under a new ‘umbrella’, aptly name Outercurve (outer to Microsoft, only by means of obfuscation and illusion). Here is Microsoft’s explanation for the symbolic move:
The branding, undertaken to reduce confusion and differentiate the not for profit foundation from the Microsoft owned and operated forge CodePlex.com, comes a year after the foundation’s launch. In that time the foundation has developed a governance model, hired executive and technical management and elected an independent Board of Directors. Additionally the foundation created a project acceptance and management process that enables it to accept and support contributed open source projects – six projects have been accepted to date.
As Simon Phipps put it, “The new initiative was being weighed down by its association with Microsoft, so this rebrand is an essential step if they are to achieve the potential they speak about.”
Outercurve is just another proxy for Microsoft. It’s hardly worth debating at all because it’s obvious to anyone inside the Free software world (outsiders might be more gullible and also the crowd Microsoft is gunning for). Microsoft is just reworking the method of assigning staff to serve itself while they are distancing themselves, at least perceptually.
Here is why claiming that Outercurve is not Microsoft is an illogical proposition:
Microsoft launched the CodePlex Foundation in September 2009 as a way of bridging the open-source and business communities. The organization has since attempted to distance itself from its Microsoft roots, looking for outside funding and insisting on platform neutrality.
As The H put it, it’s funded by Microsoft and it’s about software patents too. It’s not just run purely by Microsoft (it tried putting some people who were not previously Microsoft employees inside this shell).
Although it has been looking for further sponsors, the Outercurve Foundation is however, still solely sponsored by Microsoft and still describes itself as being able to “provide a software IP management process and project development governance to enable and encourage organisations to develop software collaboratively to develop results faster”.
Red Hat’s Fontana wrote: “It would be sort of funny if the Outercurve Foundation were named after a Eugenius Harvey Outercurve.” Perhaps he meant Eugenius Harvey Outerbridge. Microsoft Florian likes Outerbridge, which must mean that it’s bad for GNU/Linux. He too appears to be a front (now proceeding to attacks on the FSFE). █
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