06.21.09

Microsoft’s Nathan Myhrvold on How “to Freeze the Market at the OEM and ISV Level”

Posted in Antitrust, Hardware, HP, IBM, Microsoft, SUN, UNIX at 5:45 pm by Dr. Roy Schestowitz

Summary: Blast from the past (via Comes vs Microsoft) shows how Microsoft attacked Sun’s SPARC and UNIX

THIS post presents a revealing memo from Nathan Myhrvold — one that we previously looked at very briefly.

Nathan Myhrvold’s explanation of Microsoft vapourware tactics has been seen since then on numerous occasions because Microsoft presently uses this tactic against GNU/Linux and against ODF [1, 2]. We have a prior court exhibit about it.

“We have already amassed quite a few ‘smoking guns’ from Nathan Myhrvold.”The latest court exhibit is a narrative rather than a rundown though the history of Microsoft vapourware. It was written only by Myhrvold, who is currently Microsoft's main patent troll, which is backed financially by Bill Gates. Gates himself has a patent-trolling firm [1, 2. 3], but this is another story for another day.

We have already amassed quite a few ‘smoking guns’ from Nathan Myhrvold. The list will gradually grow. In today’s exhibit he is shown writing to Bill Gates and Brad Silverberg, who once urged Microsoft to “cut those f*ckers [companies that didn't use Microsoft] off”. We showed what else he had done just a few days ago.

Here is the original exhibit, Exhibit plex_0411_a (1990) [PDF], which is extremely hard to read. We include it as plain text at the bottom and we also summarise some key points below, for those who are too impatient to read the whole thing.

As background, here is an expression of fear, due to Sun’s SPARC

Recent events show that we are in more danger than ever losing the key early ground to SPARC,
which Puts our long term systems business in serious doubt. Compaq is considering SPARC, as well as
friendlier options, and now Olivetti is too.

Myhrvold fears that “Sun will mop the floor up.”

They have a great reputation, but at present their plans are NOT in sync with ours – they are on a mission to clean up in the workstation market – and all signs are showing that if any cleaning is done, Sun will mop the floor up with them.

Compaq (now major part of Hewlett-Packard) was actually leaning towards UNIX at the time:

At present we are paralysed because Compaq is reluctant to take the kind of role that is required to push
our software and combat Sun in a reasonable way. They want to push UNIX (they’ll relent to giving us equal billing, but they will expend major effort in making UNIX successful), they are considering SPARC, and they are considering a number of ********* non-SPARC responses.

Here is Microsoft abusing the word “open” — something that Microsoft does to this very date (against “open source”, which did not exist at the time, not under this particular name/banner anyway).

2. The slogan for the hardware design will be “The First Open System”.

A nice mention of SCO in there (in a few places):

3. The MIPS camp, like the UNIX world as a whole, is divided between OSF and AT&T factions. We will not succeed in unifying this as we once thought, and I do not believe that we should even try. If MIPS and/or SCO offer a product – fine, but it is not a big deal to us and we would NOT expend huge effort to ram a MIPS UNIX standard down anybody’s throat. Oddly enough it is not a big deal to the UNIX market players themselves either – they will pursue their present fractured strategies quite happily.

Here is Myhrvold planning to announce vapourware:

- A major part of the message is that your investment in Windows is safe – we are going to address 32 bits, and beyond that we will address RISC. You can go ahead and ignore Sun and that crap because Windows has all bases covered.

Myhrvold says very explicitly “vapourware” and “PR offensive” (like the "NC is dead" offensive).

The purpose of announcing early like this is to freeze the market at the OEM and ISV level, In this respect it is JUST like the original Windows announcement. This time we have a lot better development team, so the time between announce and ship will be a lot smaller. Nevertheless we need to get our message out there.

One might worry that this will help Sun because we will just have vapourware, that people will stop buying 486 machines, that we will have endorsed RISC but not delivered. After thinking about this, I think that this is emphatically NOT the case:

- We answer the charges of “vaporware” by pointing at Windows, (after all, we are porting it). Windows is shipping a zillion copies an hour and that isn’t vaporware at all. Every Win 3 sold and every new Windows app is a nail in Sun’s coffin. We would go on a PR offensive with exactly that mission. The big news is that now that MIPS will have Windows, and gain all of the momentum that is building – how can Sun survive? So, Scott, do you really think you can fight that avalanche?

He adds:

- The “Osborne effect” is not relevant here. A long term announcement for MIPS based Windows in 92 will NOT freeze the end user market. It is just an endorsement that Windows has a future – it is too far off to hurt immediate sales, and in fact it will help. The original Windows announcement did not hurt Dos sales because people decided to wait for it. The only time when you get into an Osborne effect is when you announce something near term that is a viable alternative.

We certainly do need to follow this announcement with a good demo in 6-8 months when the SDK ships, but preannouncement is going to give Sun a real problem.

“PR campaign” includes analysts, just like Microsoft evangelism so often suggests:

6. We would embark on the PR campaign mentioned above to reinforce the notion that Windows was the desktop API for the next 10 years, just as Dos was for the first 10 years. Sun and others that covet the desktop would have to beat Windows – and who can do that? This should be a real push – analysts, ISVs, etc. We would really go on the offensive about how strong Windows is, and how irrelevant Sun and others are as would be challengers.

Another noteworthy tidbit:

7. One potential sop to IBM would be to announce TWO binary standards for RISC for Win 32 and OS/2 3.0 – MIPS and RIOS. I think that the Austin guys would actually do this, and they would not even be mad about MIPS being the other one because it hurts SPARC so much. If we do this, then we would announce that we will not port to any othe architecture for 3 years (obviously non-binding) to really rub it in that SPARC is out. The way to position this to them is that we’ve seen Sun building steam and we need to support the MIPS world as a generic RISC. Ideally we would do this with a short enough lead time that they couldn’t mess around too long. All we would do is announce a long term statement of direction that the technology would be available ** RIOS – this is safe for them, and it makes Sun look bad, so we could probably make it an easy decision for them.

Some occurrence of the F* word in there is omitted, but here is an ugly one to check out:

First, the goal is NOT to make this machine sell zillions of copies in 1991 – it probably won’t even ship then. What we need to do is announce a long term direction for making high end Windows machines – and freeze Sun out of our OEMs, our ISVs, and from industry perceptions at large.

There is lots more in the full text below, including the following statement: “We would also talk about the OS/2 3.0 kernal that is underneath NT Windows, how it is an industrial strength kernal for servers etc and it will serve advanced desktops etc.” █

Appendix: Comes vs. Microsoft – exhibit plex_0411_a, as text

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Links 21/06/2009: A Lot of Progress for Free Software, New Threats to the Web

Posted in News Roundup at 4:28 pm by Dr. Roy Schestowitz

Digital Tipping Point: Clip of the Day

Alexandro Colorado, international open source evangelist 03 (2004)

Digital Tipping Point is a Free software-like project where the raw videos are code. You can assist by participating.

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SCO, Microsoft, Novell, and Other News from Utah

Posted in Apple, Courtroom, Finance, GNU/Linux, Microsoft, Novell, SCO, UNIX at 7:09 am by Dr. Roy Schestowitz

Summary: A bundle of SCO news with some interpretation

SEVERAL days ago, SCO was temporarily rescued by a entity with connections to Microsoft [1, 2]. SCO may be rescued from immediate liquidation, but it remains to be seen if the plans are followed through. Either way, SCO might not die quite so quickly after all [1, 2]. Here is a quick summary of SCO news that we haven’t covered yet.

The Register gets around to writing about SCO’s rescue. The article comes from one of the publication’s better reporters, who concludes with:

An appointed bankruptcy trustee recently asked permission to dissolve SCO under Chapter 7, saying the company has “no reasonable chance of rehabilitation.” That is, unless it somehow miraculously came up with the cash to pay off its debts. And oh how we scoffed at the very idea.

It seems SCO’s uncanny survival will now be decided at the new hearing set for July 16, or the backup date July 27.

Ken Jennings from LinuxToday calls this whole thing the “Price of FUD”, correctly remarking that:

Wasn’t SCO’s earlier asking price around 5million? Now I see it’s down to 2.4 million. Wake me when it’s 25 cents, so I can put in my bid.

Remember $100 million? A lot has changed since then.

Stephen Norris has come to SCO’s rescue before. Last year, IT Business Edge blogger Lora Bentley reported that a group led by Stephen Norris Capital Partners gave SCO a $100 million infusion to rescue it from Chapter 11.

Groklaw pokes fun at this attempts from SCO to keep its head above water.

Here’s Steven J. Vaughan-Nichols on ComputerWorld on SCO rising from the dead. We’ll see. I’d describe it more like keeping the patient on life support, while hoping for a cure. The plan hasn’t been approved yet, y’all.

[...]

So is Unix heading to Iraq? Google is your friend. Nothing SCO does surprises me any more, though, not even yesterday’s events. In fact, privately I predicted to several Groklaw folks that this is more or less the kind of thing I thought they’d try. SCO never gives up. The judge seemed surprised, calling it a Perry Mason moment. But that’s because he doesn’t know SCO like we do.

Over in Germany, Heise has more than a single report about the subject, which it summarises thusly:

In yet another bizarre twist in the interminable legal dispute over source code allegedly illegally copied from UNIX System V into Linux, the SCO Group, which claims ownership of the disputed code, has secured a last-gasp reprieve from the threat of liquidation. Immediately before the crucial liquidation hearing in the bankruptcy court, SCO CEO Darl McBride signed an agreement with a company by the name of Gulf Capital Partners, backed by well-known investor Stephen Norris. Caught out by the surprise development, all parties have agreed to postpone the liquidation hearing until the 16th or the 27th of July.

Groklaw shows that SCO Germany has lost its CEO. SCO is actually a very small company at this stage, so overseas branches almost seem like a misfit, a legacy. SCO even gets fined in Germany for slander.

There is an unconfirmed claim that SCO will pass its assets to another company to operate under a different name. The sale of UNIX assets is neither a done deal yet nor is it an escape from Chapter 7, but it sure seems like a good route for procrastination, no matter the eventual outcome. SCO has nothing to lose when it’s all just paperwork.

Only moments before a hearing at which SCO would have faced conversion to Chapter 7 bankruptcy, the company signed a deal to sell off its UNIX assets. This last-minute act of desperation could potentially allow SCO to delay its demise.

Groklaw is not even sure who the proposed buyer is. It’s all very opaque, as it has always been [1, 2, 3, 4, 5, 6].

There are some media reports on the SCO cliff hanger bankruptcy hearing on Monday. The more information that comes in, the less clear I am on exactly who the actual proposed buyer is. I’ll show you why.

According to this new report, Microsoft makes another little move into Utah.

If you’re in the market for a software development job, you might want to head to Utah County. Microsoft Corp. is hiring. The software giant, based in Redmond, Wash., announced Wednesday that the company will occupy space at Thanksgiving Park in Lehi beginning in August and will eventually hire about 100 information technology professionals.

Microsoft relocated to Utah some months ago (despite layoffs in other areas) while Novell offshores Utah staff. A Novell-centric agenda was suspected at the time of this move from Microsoft, but it is probably much of a stretch and too far fetched. On the other hand, regarding the report above, Pamela Jones writes: “If SCO’s deal doesn’t happen, maybe the 62 employees left at SCO could find work with Microsoft.”

We previously saw how Microsoft rewards people who attack ODF and/or GNU/Linux by offering them jobs [1, 2]. It is a sophisticated form of bribery where action precedes the payment.

In other SCO-related news, some articles about the Psystar case note its similarity to the SCO case. See for example:

i. Apple accuses Psystar of hiding behind bankruptcy

The Cupertino, California firm goes so far as to draw parallels between Psystar and the fate of infamous software house SCO Group. Known for using lawsuits against Linux-dependent companies over UNIX rights disputes as part of its business model in later years, it’s linked to Psystar through its approach to bankruptcy: when it lost its lawsuit against Novell and was ordered to pay money on UNIX licensing, SCO purportedly used bankruptcy and the resulting stay as a defensive measure to fend off the requests for money. Novell eventually had the stay lifted — a precedent which Apple is keen to take advantage of in its own case.

ii. Psystar owes Apple $75,000 while Apple moves to lift stay (Updated)

Apple compared the tactics to those of the SCO Group in its attempts to avoid paying Novell money owed based on UNIX licensing, painting Psystar president Rudy Pedraza as the Darl McBride of Mac cloners. Apple noted that the automatic stay was lifted in that similar situation.

iii. Apple seeks go-ahead for action against Psystar

Interestingly, Apple cites proceedings between Novell and SCO as a precedent. Novell obtained a summary judgement that it was entitled to copyright royalties from SCO, but before the case was tried SCO filed for bankruptcy.

Any more information about SCO would be welcome. █

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Novell’s Financial Problems and Radical Redemption Plans

Posted in Finance, Microsoft, Novell at 6:20 am by Dr. Roy Schestowitz

Summary: More information about Novell’s alleged intent to sell parts of the business

IT is important to remember that Novell is in debt and back in 2006 Novell had a choice between going out of business or becoming a vassal of some other company like Microsoft. Novell chose the latter route by going to Microsoft with patents on the table. After prolonged negotiations and a discriminatory deal ready for signing, Novell also received hundreds of millions of dollars in almost-immediate cash infusion, in return for favours. This way, Novell could live for a while longer, so essentially, Novell ran to Microsoft for rescue.

According to Ovum, Novell’s latest results “disappoint”, despite claims to the contrary from Novell. We have already explained why this is the case, but here is Ovum’s take:

Novell sheds more light on its profitability, but disappoints

[...]

At the end of May 2009 Novell released the results of its second fiscal quarter 2009 (ended April). Revenue growth was more disappointing than in the first quarter, especially for the System and Resource Management (SRM) business unit and for the GroupWise email platform. However, profitability remained steady. More interestingly, Novell disclosed that two of its four business units, Open Platform Solutions (OPS – in charge of Linux) and Identity and Security Management (ISM), are not profitable yet but should become so within the next 12-18 months.

Reuters published an important article about an analyst from JPMorgan Chase & Co. He spoke to Novell’s CFO and here is a report from Bloomberg which precedes that of Reuters. This comes amidst times when Novell is trying to buy back debt.

Novell Inc. (NOVL US) jumped 10 percent, the most since Nov. 24, to $4.68. The second-largest U.S. seller of Linux software may be willing to sell itself to boost shareholder value, JPMorgan Chase & Co. said after meeting with Chief Financial Officer Dana Russell.

Novell’s stock jumped due to these rumours, so people obviously realise — as do ourselves — that Novell might be split and then sell parts of itself. The less profitable parts of the company will likely then be shrunk in terms of workforce and sold below value or spun off. But who would be a suitable buyer? Citrix? Cisco? IBM? H-P? Dell? Maybe some local companies? And which pieces might be sold and when? At this stage, it is mere speculation. █

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Iran Uses Novell and Microsoft Software to Make Bombs

Posted in Asia, Interoperability, Microsoft, Novell, Patents, Security, Servers, SLES/SLED, Windows at 5:58 am by Dr. Roy Schestowitz

Summary: Novell and Microsoft a matter of national security, but whose?

THERE is an old slur about GNU/Linux being the operating system for “terrorists” (or something along those lines). Why does Microsoft get a free ride?

According to The Register, SLES 10 and Windows power some of Iran’s nuclear programs.

That second generation box, which has 16 dual-core and another 16 quad-core Opteron processors from Advanced Micro Devices, 98 GB of total memory, and 182 gigaflops of aggregate computing power, runs Novell’s SUSE Linux Enterprise Server 10 as well as Microsoft’s Windows Server 2003 Enterprise Edition.

[...]

While ComputerWorld and Iran Watch, a group dedicated to the non-proliferation of nuclear weapons technology to Iran, made much of the AMD iron and didn’t say anything about the Novell and Microsoft software, the real worry is what application software Iran is able to get its hands on to do finite element analysis and fluid mechanics in the design of the rockets.

To use some sarcasm, did Iran buy its SLES coupons from Microsoft? For software patents, obviously? Novell and Microsoft could probably issue a press release to rave about this deployment and quote the army regarding the “interoperability” advantage or "peace of mind" they receive from these coupons. Now, if only they could be sold “peace”, too.

In other security news, Microsoft’s friend Finjan [1, 2, 3, 4, 5, 6, 7] is warning (again) about Windows botnets. From Heise:

Security services provider Finjan has released a report from its Malicious Code Research Center analysing a trading platform for botnets. According to the report, the underground trade in infected computers offers a comprehensive menu of botnets at locations all around the world. Some Far Eastern networks can be had for a mere $5 a thousand PCs.

Watch the role and effect of Windows malware in this process. From the BBC (days ago):

“This emerging threat is becoming very real and is already affecting millions and millions of websites. 30,000 web pages are affected every day according to the likes of Microsoft and the security firm Sophos,” said Mr Daswani who was a senior security engineer at Google.

Ask the FBI about Windows security [1, 2]. █

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IRC: #boycottnovell @ FreeNode: June 20th, 2009

Posted in IRC Logs at 1:42 am by Dr. Roy Schestowitz

Read the log

Enter the IRC channel now

To use your own IRC client, join channel #boycottnovell in FreeNode.

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Novell News Summary – Part III: Novell’s Proprietary Business

Posted in Mail, Marketing, NetWare, Novell, Security, Servers, Virtualisation at 1:35 am by Dr. Roy Schestowitz

Summary: The remainder of the news about Novell

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06.20.09

Novell News Summary – Part II: A Lot About SLES, Little About Scalix and Xandros

Posted in GNU/Linux, Novell, Scalix, Servers, SLES/SLED, Xandros at 5:38 pm by Dr. Roy Schestowitz

Summary: Assorted news about GNU/Linux that funds Microsoft

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