Microsoft, market share, and innovation ...

Microsoft: Don't sell PCs without operating systems

Graeme Wearden
ZDNet UK
April 07, 2006, 11:25 BST

This story came to my attention through a post in New-Continuum a week or so ago. Its interesting for few reasons, but certainly not because its an unusual business practice for Microsoft. They have always pushed hard for OEM installs and licensing that made installation of other products difficult. This direct threat to customers and distributors is somewhat new, but even that isn't without precedent, lol.

The main argument (or at least the one with some semblance of reality to it, lol) is that selling PC's with no operating system installed provides opportunities for people to install pirated versions of MS software. Even if this is true, its hard to see how its the responsibility of PC sellers to deal with MS's piracy problems. If pirated software was the ONLY option on a machine with no OS installed, or even the most likely one, then I could see a concerted industry effort. But any good PC seller knows there are people like me out there, people who hate having to wipe out a perfectly good Windows installation so they can properly partition their new machines to dual-boot or triple-boot multiple legal operating systems.

This is not an unusual tactic for MS, really. A look through their legal history shows them walking a fine line between exploitive and criminal manipulation, and keen business acumen. They've really walked that line since the begining.

In the beginning, there was XENIX. Microsoft's first major public operating system release was not any form of DOS, nor was it anything written by a Microsoft employee. Microsoft was founded on the success of Altair BASIC, a programming language/environment invented by Bill Gates in university in 1976, but its first major OS product was a UNIX variant purchased from AT&T named XENIX. One of Microsoft's most recognizable software names started as a XENIX program ... MS Word began life as Multi-Tool Word for XENIX.

The real break for Microsoft came from IBM. They were developing a new personal computer using the 8086 chipset, and an operating system by Digital Equipment Corp called CP/M-86. The problem was, CP/M was very expensive, and in something of a Machiavellian move, IBM contracted an early Microsoft to reverse engineer a cheap version of CP/M.

And so PC-DOS was born, a Pinto ($40-ish) alternative to the Cadillac CP/M-86 ($240-ish). Of course, in what has become a classic case of knifing someone in the back while their attention is one wielding their own knife, Gates was busy developing his own version for 'clone' hardware, released 9 months after the first PC-DOS version, called MS-DOS. Version 2 of each system was reversed, with MS-DOS 2.0 coming out before PC-DOS 2.0. In essence, Microsoft gave IBM the OS they needed to stab Digital over the licensing of CP/M, while quietly sliding the knife into IBM's ribs as they developed and marketed MS-DOS for non-IBM hardware.

Still, from 1975, when Bill wrote Altair BASIC, through the mid-1980's , very little innovation was happening at Microsoft, really. There was a lot of buying, and reverse-engineering, and double-engineering going on, but not a lot of actual innovation. As 1983 and 1984 rolled around, the market success of DOS (which literally stands for Disk Operating System, BTW) and the 'PC' architecture was clear, but so was the success of clone hardware makers, at the expense of IBM's more expensive, albeit better made, systems.

In many ways, 1984 changed the personal computer industry forever. It is the year when the 'modern' era began with the introduction of the Apple Macintosh. Not only was their ad campaign revolutionary (and still, some 22 years later, worth a look), but the Mac set the standard for OS and hardware design, doing things that were truly revolutionary in a desktop machine.

From the beginning, Microsoft has been more about buying and borrowing other technology, than about creating their own. Their 'questionable' business practices go back as far as reverse engineering CP/M, a CLEAR violation of the very DMCA they so vigorously support today, lol, and the high-pressure marketing tactics go back at least as far as the release of MS-DOS beside PC-DOS in 1982.

Nothing in the new article really surprised me. The only thing that continues to surprise me is the Microsoft can maintain market share on mediocre innovation. I suppose that's business however, lol.