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Counterpoint | 105 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
An easy way out
Authored by: stegu on Thursday, June 28 2012 @ 06:22 AM EDT
It's a bit sad that they don't see the easy
and obvious way out: stop breaking the law.

Naah, kidding. They couldn't stop if their
life depended on it -- which is clearly
demonstrated by them not stopping now that
their life really does depend on it. If they
don't change, they might go out with a bang
instead of with a whimper, but perhaps they
prefer to die fighting than to slowly rot away
after accepting a defeat and failing to compete
fairly?

[ Reply to This | Parent | # ]

Counterpoint
Authored by: sproggit on Thursday, June 28 2012 @ 03:37 PM EDT
1. 2011 by the Numbers

Q1: Revenue: $16.20 Billion; Net Income $5.41 Billion
Q2: Revenue: $19.95 Billion; Net Income $6.63 Billion
Q3: Revenue: $16.43 Billion; Net Income $5.23 Billion
Q4: Revenue: $17.37 Billion; Net Income $5.87 Billion

2011 Totals: $69.95 Billion; Net Income $23.14 Billion

The above is just one of the 4 financial years that have elapsed since the case started. In this one year, Microsoft's revenues were a shade under $70 Billion, their net Income more than $23 Billion. The EU fine of Eu860 [for the sake of simplicity let's assume approximate parity with the dollar] equates to 3.7%. Yes, less than 4%. Their figures have been variable across the 4 years but grant me the flexibility to approximate this out: averaged over 4 years this fine is less than 1% of net earnings.


2. Standing on their Heads
You make a good and valid argument that Microsoft fought tooth and nail to overturn this judgment against them. I think they were very successful.

Even if this case cost them millions of dollars to defend (and it likely did), what would a few tens of millions of dollars be against a fine of 860 Million Euros? Answer: nothing... It was worth a punt.


3. Rolling Over
Serious question: when was the last time that you heard of a finding or a ruling against Microsoft where they shrugged and said, "It's a fair cop, your Honor, you've got us bang to rights. We'll do what you say." ??? Answer: never. It is not in Bill Gate's character to be able to do that. In the recent dispute by Novell, the entire jury agreed MS were guilty and one hold-out juror disagreed over the damages. Microsoft's response? they tried to get the entire case and findings thrown out. There had been no dispute over the guilt part... That's how they operate...

Do you remember the reports from the first anti-trust investigation into Microsoft, where they had the DoJ and a bunch of Microsoft lawyers in a room dealing. Apparent agreement would be reached, and the MS lawyers would phone Bill, who would scream down the phone at them, sending them back to the start of the negotiations...? Microsoft are Grand Masters at negotiating with regulators and courts.


Result
You are absolutely 100% correct to say that Microsoft fought vigorously over this particular finding. 860 Million Euros is an awful lot of money and that warrants the company take it very seriously indeed.

But you are quite, quite wrong if you think that they see this as anything other than the cost of doing business. Pick any competitor to a Microsoft product:

Linux as a threat to Windows LibreOffice as a threat to MS Office PS/3 as a threat to the X-Box

Ask yourself: Would Microsoft be willing to spend $860 Million to cripple, stymie, block, delay, destract or otherwise harm that competition long enough to enable them to entrench their strangle-hold on the relevant market?

You bet they would. That's good commercial sense to them.

Does it bother them that they had to pay? Of course it does. Did they factor this in when they chose that path of action. Absolutely they did. This was a business decision. Events played out as expected and Microsoft paid.

But they paid a pittance. Not enough for them to notice.

[ Reply to This | Parent | # ]

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