Pondering the Platform, Part II

The personal computer marketplace is a collection of horizontal slices — CPU, OS, graphics hardware, apps, etc. Intel and Microsoft own many of those slices, but no company owns them all. This isn’t the way it was in the mainframe era, a vertical market dominated by IBM.

Vertical-market technology seems to be coming back, in the new information appliances. I explain what I mean by that in my Tuesday column in the San Jose Mercury News.

Microsoft and Justice Face Off Today — What Has Changed?

Our favorite monopolist squared off today (Mercury News story) against the U.S. Department of Justice, a bunch of state attorneys general and the District of Columbia. The occasion will be oral arguments in the antitrust case.

U.S. District Court Judge Thomas Penfield Jackson’s scathing “findings of fact” in the antitrust trial last fall were an obvious prelude to a verdict on the law — a verdict that almost certainly won’t come out in favor of Microsoft. The findings led Microsoft to launch a PR offensive. The idea was to convince the public that even if it was found guilty of wrongdoing — of course, the company continues to insist that day is night and night is day — the offenses didn’t justify any serious remedies.

Wrong, wrong, wrong. Microsoft is still by far the most powerful single force in the technology industry. The woe-is-Redmond chorus is a combination of wishful thinking and misinformation.

Anyone who thinks Microsoft’s clout is ebbing should read the March issue of Wired magazine. An article by John Heilemann tells how Silicon Valley’s most powerful executives showed all-too-typical cowardice late last year when it came to standing up to Microsoft. They cravenly ducked when the government asked for public support for stern antitrust remedies.

Since then, Microsoft has reported yet more massive earnings and revenue growth. It continues to generate cash at an accelerated rate despite going on a wild spending spree for new technology to complement Windows and its applications. Those investments guarantee Microsoft a strong position in whatever markets emerge in coming years. Investors have made Microsoft the most valuable company on Earth. This is not what happens to a pitiful, helpless giant.

This entry was posted in SiliconValley.com Archives. Bookmark the permalink.