Breaking "Windows"

So, in the long, long antitrust process against Microsoft, which has been going on for almost five years with some interruptions, changes in signage and formal charges, a radical turning point has occurred. If earlier the parties fought on approximately equal terms, now one of them has been declared clearly wrong. Wrong to such an extent that it no longer even has the right to exist - according to the verdict of Judge Jackson, Microsoft should be divided into two companies, one of which will deal exclusively with the Windows operating system (let's call it MicroWin), and the other with various applications (let it will be MicroApp).

However, this is far from the end of the story, which will be completely completed in a year at the earliest, but rather a year and a half or two. Moreover, Microsoft will now act as a victim, which may even be to its advantage. This is not the end of District Judge Thomas Penfield Jackson's personal odyssey - the case will go through several more stages of appeals and it is possible that at some point it will return to the same Jackson.

What happened to Judge Jackson? Over the past two years that he has been involved in the Microsoft case, he has repeatedly slammed the world's largest software company with epithets like "disingenuous," "hypocritical" and "untrustworthy"; and finally, on Wednesday June 7, at 16.30 in the afternoon, he decided to divide the giant into two parts in order to avoid its final transformation into an evil empire. A casual observer might even think that Judge Jackson doesn't like this company very much.

Most likely, this is the case. Indeed, in his conclusion, he rewrote almost word for word the paper that was received by him from the US Department of Justice from prosecutor Joel Klein, who was acting on the side of the former in the case “State v. Microsoft”. Jackson's dislike for Gates and his associates in its emotional intensity can only be compared with the invective addressed to the richest man on the planet by fans of the Unix, Linux operating systems and other non-software: “Bill Horrible” is perhaps the mildest definition that can be heard in this camp. In terms of its destructive power, Jackson’s dislike has nothing to compare with - there is no point of reference.

Maybe Jackson is a secret Unix fan? No - I remember at one time he admitted that he didn’t even check his email himself. One of the court clerks who worked with Jackson admitted to Wired magazine (www.wired.com): "He's just stupid. Not in the everyday sense of the word, but in relation to any technology." Most likely, Thomas Jackson hopes to go down in history - as far as we know, he will soon retire (he was appointed during the time of President Reagan and was his personal protégé), and therefore he especially desperately wants fame. Consider it in his robe pocket. All of the above, however, does not mean at all that the American judge will remain in history as Herostratus - Microsoft is in fact not going anywhere.

Empires worth 200 billion dollars don't just fall apart. Itogi has repeatedly predicted (most recently in March of this year) that, despite the optimism of Microsoft CEO Bill Gates, a judge will decide to split the company by summer. But at the same time they predicted that shareholders and users would lose little.

The first of the two companies to emerge over time, MicroWin, will inherit 85 percent of the personal computer operating system market. A business in this position moves like a heavy locomotive down a slight slope - even if it doesn’t take off, it will sweep away any fence on the way, just like it never happened. But no matter how powerful the first company is, it cannot match the attractiveness of the second, MicroApp. The future of the computer industry (and Microsoft leaders fully agree with this) lies in the plane of network applications, the Internet. The main building blocks of Microsoft's "Internet platform" are its developer tools and server applications (such as SQL Server and BizTalk, a business document server), which, according to the plan imposed by Microsoft, go to the second company. Judging by the structure of the company's revenues planned for 2000, I can assume with a high degree of confidence that the second "shard", MicroWin, (in its unborn state) occupies no more than 40 percent of the total Microsoft. Next year the gap will certainly become even greater, no matter how the dismemberment case turns out. Of course, superbillionaire Bill Gates and his colleagues claim that “everything is lost,” that “the five-year long-term development plan will have to be rewritten,” that “from now on, innovation in the computer industry in general is a big question,” etc.

Don't believe it. American justice is right now trying to prove that everyone is equal before the law, using the largest, brightest and most easily accessible example for it. Twenty years ago, the giant monopoly AT&T (communications and communication) was dealt with in approximately the same way, only there were more parts, and the result obtained, as is now clear, benefited both AT&T’s “children” and customers. And now, before it’s too late, the American state is trying to disband the company, which has all the signs of a state within a state.

Let's remember the history of the market conquest of the Internet Explorer browser - almost three billion dollars were invested in its development, while Gates solemnly promised never to sell it to anyone, but only to give it away for free. Explorer won, but there was no economic sense in the victory itself - it was a purely military campaign, and its financing in the overall structure of Microsoft's expenses had all the formal signs of a military budget for the state treasury. Jackson is trying to turn such a US conglomerate into a peaceful and, let me emphasize, successful company. If this succeeds, Judge Jackson will not for nothing take his place in history.

Of course, there are still years of fighting ahead. In the very near future, there will be an appeal court (the same one that overturned Jackson's previous decision two years ago), then one of the parties will definitely concern the high judges of the Supreme Court with this matter. The outcome, however, is a foregone conclusion for at least one reason - Microsoft will not be able to get rid of its worst enemy. His name is Bill Gates. He is so childishly naive and confident that everything that has happened so far is the machinations of bad people, and he and his company are white and fluffy, that he does not want to make any compromises. And business differs from dictatorship precisely in compromises, Washington lawyers are firmly convinced of this. And sooner or later they will illustrate their confidence with a clear example.

June 8, 2000