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September 21, 2007

Microsoft, It Is Time To Say Bye-Bye To Europe

Analysis of: Microsoft's Big European Defeat: What Now? | www.businessweek.com
This analysis is solely the work of the author. It has not been edited or endorsed by GLG.
Analysis By:
P.J. Louis
President, PJ Louis LLC
Implications: Microsoft should not be surprisedMicrosoft got what they were asking for - you played hardball with the European standards community and discovered they are a front for their national governments.  You should not be surprised they lashed back.Microsoft needs to play nice and tough

Analysis:

I am not one for monopolistic dominance by any company over any marketplace. I am also not a major supporter of Microsoft. In fact I think their products are designed to have software glitches. However, let us think back on how Microsoft achieved such super-dominance. I will sum it up in a few words: “They were smarter than everyone else in the marketplace”.

True, Microsoft has been unreasonable in getting their media player and web surfing platform on every single laptop and desktop computer but do you blame Microsoft being super aggressive marketing their platforms or the computer manufacturers for rolling over. True, Microsoft has acted like a gorilla forcing their products on the world. However, the reality is that product integration of any technology is not only about meeting consumer needs but also meeting them quickly. Frankly, Microsoft did the best job of marketing its product and cutting deals with all of the major computer manufacturers. Blame them for being better business people. Hey guess what, this is called COMPETITION.

No one has been able to come up with a suite of services, software, and business tools to effectively compete against Microsoft. If we all recall what the business application software business looked like 20 years ago, we had Lotus, we had Microsoft Word, we had Forethought’s Power Point, and a bunch of other now long forgotten application software companies. The problem we had was getting all of the software to work together. There was so much incompatibility that sharing documents was only possible if all parties were using the same programs. Needless to say things were a mess and a genuine pain in the-you-know-what.  Once document exchange became an easy matter, computer sales climbed and doing business became easier.

The decision by the European courts is going to hurt innovation. If all you have to do is have some European government or the European courts simply decide how you will do business, then you will simply convince your favorite politician or judge that you are being wronged. This is an absolutely horrible thing for any competitive business, not just for Microsoft, but any business. Why bother building the best of breed product when all you have to do is convince your favorite government minister or judge the other company is a very bad guy and is nothing more than an American company dominating your domestic marketplace. I am opposed to monopolistic behavior in the business place. But we are not talking about that. Microsoft has rightfully claimed the throne for computer operating systems and software. What is happening in Europe is not about trying in court an anti-trust violations case. This is all about Europe not wanting to do business with an American company.

This decision goes way beyond, Microsoft not playing well with the international standards community. This decision is focused on a single company and ensuring that this company does the bidding of governments whose technology companies have failed to replace, supplant, or reverse engineer Microsoft’s products.

Imagine, the personal computer looking like the platform of the late 1980s; I can see the nightmare of that time repeating itself all over. The only thing I can see is that the European courts are actually trying to give their domestic vendors a leg up on Microsoft. As for future competition in Europe, I guess the first step and rule of thumb is going to be getting the courts to cripple competition.

Here is my suggestion for Microsoft. Walk away from Europe and let our European friends find a replacement for you. The minute Microsoft opens up it’s code it will find it’s way in the hands of the Asians and any other country attempting to replace Microsoft. You thought patent and softare copyright infringement has gone wild wait unti you see Microsoft truning over its code.  The European courts’ requirement is a deliberate attack against a company that has demonstrated through the competitive marketplace it has the best product.

I bet the Europeans will roll over. They don’t have anyway to replace Microsoft; at least in a way that their computers will still function.


Other Analyses of the Same Source Article:
Microsoft ruling is NOT a general attack on success
September 24, 2007, Author: GLG Expert Contributor
Americanization of Europe and vice versa - Microsoft, Google, Oracle, large high tech companies
September 24, 2007, Author: GLG Expert Contributor
Not what one may expect....
September 24, 2007, Author: GLG Expert Contributor
Despite Microsoft's setback, there is a far bigger question at hand: What might this mean for other major software players? Oracle... SAP...
September 20, 2007, Author: GLG Expert Contributor
Role of Justice & Government
September 20, 2007, Author: GLG Expert Contributor
Microsoft v. European Commission: a victory for innovation & for the consummer
September 20, 2007, Author: Miguel Mesquita da Cunha, Consultant, Miguel Mesquita da Cunha

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