Seattle’s Bullyboy wins out again

Greg Palast

By Gregory Palast for The Observer/Guardian UK

Britain had to go to war to force China to buy opium. But the USA hasn’t had to fire a single bullet to make the world surrender to our Disk Operating System.

Europe may realize its nineteenth century dream of a common currency, but that’s nothing compared to America’s control of the common PC desktop. All must pay tribute for our Windows, fourth-rate product though it may be. This is imperialism, California style.

Before we dig into Microsoft, I’ve got to get this off my chest: Bill Gates is the absolute stone-cold worst businessman of the entire millennium. Yeah, yeah, I know he’s the richest boy in the solar system. But consider this – Mr Gates tried again and again to get rid of his company, offering to merge it into Lotus Corporation, for gosh sakes, then floating away 80 per cent of his ownership through share offers.

In other words, he couldn’t wait to trade bars of gold for a bag of peanuts. The man had no concept of his own product, no faith in it, no vision of it. Gates is an accidental bazillionaire. Like the character in Hitchhiker’s Guide to the Galaxy who tripped over a balcony and found himself flying, so Gates found himself, despite his best efforts, the Midas of the Microchip. And that’s what the US anti-trust case against Microsoft is all about: Gates’ business astigmatism. Because what does a guy, small of stature, none too secure in his talents, do to protect his windfall? He becomes a bully. Take, for example, his charming sales pitch for Windows to IBM. ‘As long as you’re competing with Microsoft, you will suffer.’ Big Blue was also informed by Microsoft that ‘Mr Gates was really mad’. Apparently, IBM had been caught offering non-Microsoft products.

On top of that, ‘We have a problem if you load Netscape’. I imagine these lines delivered by a couple of gorilla-sized knuckle-draggers wearing dark suits and broad-brimmed hats: ‘Mizta Gates sez he ain’t happy…’

Internal Microsoft memos recognised that the company’s Internet browser could not compete head-to-head with Netscape’s. Microsoft could have improved its own software and pitched it on its merits. Instead, Gates chose to ‘cut off Netscape’s air supply’, as a Microsoft executive gleefully told Intel Corporation. The Microsoft messenger was allegedly relaying the scheme laid out in Gates’ May 1996 email describing how to wipe out Netscape’s cash flow and stock price by dropping the price of Microsoft’s own browser to zero.

It worked. Netscape, suffocating from lack of revenue, saw its 70 per cent market share halved.

Another threat to Windows came from Java, software designed to permit any program to run on any computer (which Windows dreams of doing, but cannot). Gates personally approved plans to ‘pollute’ the competing software by shipping versions of Java contaminated with code that made Java run poorly if not combined with Windows. ‘Kill cross-platform Java by grow [sic] the polluted Java market,’ was found in one company memo. Polluting Java is akin to a teenage hackers’ planting of email viruses. So here we have the great Gates concocting goofy kids’ pranks rather than a real business plan (though admittedly, the code contamination worked to deadly effect).

These images of Billy the Bully are drawn from the US Justice Department’s 776-page ‘Findings of Fact’ plunked on the trial judge’s desk last week. With all the hyped drama of the confrontation between Gates and government, the press did not seem to notice this signalled a profound shift in the Justice Department’s case. Although mercilessly pounding Gates’ tactics, the department appeared to back away from direct threats to the Windows monopoly.

The government portrays Windows as Satan’s software, yet demurs from implying the need for the court to smash Gates’ stranglehold on operating systems. The department could have used its authority to force open the market to competing software such as free-of-charge Linux. The Big Case had shrunk.

The Justice Department now quarrels over such itsy-bitsy issues as whether Microsoft must put the little Netscape Navigator icon on the Windows desktop and whether Gates must permit computer manufacturers to remove Internet Explorer software – which comes with Windows free of charge anyway. Like, are we supposed to care? The government fired an elephant gun, and seeral gnats lay dead. I was curious about the government’s unexpected diffidence.

Putting aside concern for privacy or family obligations, I hunted up Joel Klein, chief of the Anti-Trust Division, on vacation in Barbados. ‘The acquisition of the Windows monopoly we do not challenge,’ Klein confirmed. Really? Justice might be satisfied by making Microsoft, put another icon on the desktop and other such fixes, though his Department will make no formal statements about these until the judge rules Microsoft a monopoly, expected before the end of the year. So Windows is home-free. While Klein’s evidence is brick solid, he seems to have resigned himself to the will of the public.

Americans hate Gates’ monopoly, but we love what his monopoly does for us: forcing every personal computer to look and act the same (more or less).

Heaven forbid manufacturers start loading up computers with non-Windows operating systems. Klein conceded: ‘There are huge switching costs when people get used to a particular program.’

This will make the techno-geeks screech with frustration. They rail that Windows is an inferior product. But these are people with inferior lives. Where the Silicon Valley cyberati and the human race divide is that we have other things to do besides learn new operating systems every six months.

We are quite grateful to Bill Gates for standing in the way of innovation. But even the computer-clueless will eventually tire of Windows’ shortcomings and its electronic petulance. When I can’t switch between one word processor and another, you’d think a message would appear on my screen: ‘Mr Gates apologises for the inconvenience caused by the deficiency in Windows.’ Instead, Bill’s cyber-cops threaten me, ‘You have performed an illegal operation.’ Oh no I haven’t! Gates can only hold out as a roadblock to the future for so long.

The personal computer, the PC, is a dying technology. You know a technology is dead when both Al Gore and Tony Blair insist on putting one in every schoolroom. The very concept of the PC borders on the absurd, premised on every computer holding all the thinking codes. That’s like making telephones that weigh eight kilos, and are as big as your head, so they can contain all the system’s switching information. It’s infinitely more efficient to have wired or wireless devices connected to central mainframes that will operate all the necessary software.

In Europe, international monopolies are encouraged to beat the citizenry about the head and shoulders. This is called ‘creating national champions’. So why did the US government batter Bill Gates, our very own national champ? The Department of Justice won’t admit it, but what drove the anti-trust suit against Microsoft is this: Americans can’t stomach some little schlemiel with a pocket protector piling up a net worth bigger than General Motors and the Catholic Church’s combined by charging us $40 every time we buy a new computer to receive software that, at its heart, just makes the disks spin.

Klein will become a national hero, even if he gives Windows a pass. Justice has pantsed the smug little boy from Seattle and made him endure his 15 minutes of shame. That’s all we really wanted. I’m convinced the reason Microsoft stock rose 400 per cent during the anti-trust trial is that the government evidence reassured investors that Gates has the the warrior will to muscle, pollute, and smother threats to the Windows god.

Microsoft just became the first corporation ever to reach a market value exceeding half a trillion dollars – roughly 100 years of profit at the current levels. Shareholders must assume that, contrary to the denials of Microsoft’s own lawyers, the Microsoft Imperium will continue to collect its worldwide disk-spinning tax for another century. But when the PC finally dies, Windows will be buried with it. In 1995, Gates turned computers into brandless commodities, mere boxes to carry around Windows, and so laid low the mighty IBM. And that is what keeps Gates punching the office time clock every day and tossing sleepless every night – not the government’s trustbusters but the fear that someone will do unto him what he did to IBM.

Among the hundreds of his email notes displayed for trial is one with Gates’ plaintive rumination on his doom. He fears the day operating systems are ‘commoditised’, becoming nothing more than the means to get to the Net. When that happens, and it must, American capital will wake up to find it has placed a half trillion dollar bet on a monopoly without a product.

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Gregory Palast’s other investigative reports can be found at www.GregPalast.Com where you can also subscribe to Palast’s column.

Gregory Palast’s column “Inside Corporate America” appears fortnightly in the
Observer’s Business section. Nominated Business Writer of the Year (UK Press
Association – 2000), Investigative Story of the Year (Industrial. Society – 1999), Financial Times David Thomas Prize (1998).