Monthly Archive for May, 2007

D5: Gates and Jobs together

Published
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Ryan Petty
on 31-May-2007
in Apple, Business Excellence, Innovation and Microsoft
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At this years All Things Digital Conference D5, hosted by the Wall Street Journal, Bill Gates and Steve Jobs were on stage together in a “fireside” interview with Walt Mossberg and Kara Swisher. This coming together was billed as one of the great events of all the D: conferences and in my view it was every bit as good as its billing.

Highlight clip:

There were so many great moments, that it is difficult to single any out without artificially reducing the rest. However, in the audience Q&A section, they were asked about things they had learned in building their companies. I thought Jobs answer was extremely insightful. He said,

People say you have to have a lot of passion for what you’re doing and it’s totally true. And the reason is because it’s so hard that if you don’t, any rational person would give up. It’s really hard. And you have to do it over a sustained period of time. So if you don’t love it, if you’re not having fun doing it, you don’t really love it, you’re going to give up. And that’s what happens to most people, actually. If you really look at the ones that ended up, you know, being “successful” in the eyes of society and the ones that didn’t, oftentimes, it’s the ones [who] were successful loved what they did so they could persevere, you know, when it got really tough. And the ones that didn’t love it quit because they’re sane, right? Who would want to put up with this stuff if you don’t love it?

So it’s a lot of hard work and it’s a lot of worrying constantly and if you don’t love it, you’re going to fail. So you’ve got to love it and you’ve got to have passion and I think that’s the high-order bit.

The second thing is, you’ve got to be a really good talent scout because no matter how smart you are, you need a team of great people and you’ve got to figure out how to size people up fairly quickly, make decisions without knowing people too well and hire them and, you know, see how you do and refine your intuition and be able to help, you know, build an organization that can eventually just, you know, build itself because you need great people around you.

Here are the pertinent links:

Transcript: http://d5.allthingsd.com/20070531/d5-gates-jobs-transcript/

RSS: http://d5.allthingsd.com/feed/

Complete video set:
http://d5.allthingsd.com/20070530/video-steve-jobs-and-bill-gates-prologue/

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D5: Stephen Colbert introduces Philippe Dauman

Published
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Ryan Petty
on 31-May-2007
in Humor and Innovation
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Novell goes public with terms of Microsoft deal

Published
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Ryan Petty
on 29-May-2007
in Innovation and Microsoft
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Novell goes public with terms of Microsoft Linux deal - Network World

The patent agreement between the two companies seems to make it clear that Novell does not accept any of Microsoft’s patent claims. Section 3.4 says, “Nothing in this Agreement shall imply, or be construed as an admission or acknowledgement by a Party, that any Patents of the other Party are infringed, valid or enforceable.”

Sounds like the best news OS advocates could have hoped for

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Microsoft Patent Claims Hint at Internal Issues

Published
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Ryan Petty
on 14-May-2007
in Innovation, Microsoft and Politics
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PC World - Microsoft Patent Claims Hint at Internal Issues

In a follow up to Microsoft takes on the free world, PC World has an article today which points to internal issues as Microsoft that may be driving their recent “behavior” vis-a-vis patents.

Microsoft’s claims that it will ask distributors and users to pay royalties for up to 235 of its patents included in open-source software, including Linux, is clearly an attempt to spread fear, uncertainty and doubt and make people hesitant to use open source as an alternative to commercial products, intellectual-property (IP) attorneys said. But the claims also raise questions about the business strategy behind Microsoft’s aggressive moves to seek licensing money from patents amid rumbles that customers have been slow to adopt Windows Vista and Office 2007, while new products such as the Xbox 360 remain unprofitable.

There may be a link between the timing of Microsoft’s claims against open source and the release of its Windows Vista product, said Stuart Meyer, partner at Fenwick & West in Mountain View, California. Rather than add features to Vista that would make business users want to adopt it, the OS’ distinguishing characteristic is the addition of an engine that will shut down users access to Vista if they are using a counterfeit or pirated version of the software, he said.

“Why do people want to want to switch to an OS that just includes new hurdles that have to be cleared?” he said. Microsoft may have decided that enforcing its IP through litigation is more important than offering innovative software that can compete on its own merits, a strategy that may leave many users unimpressed, Meyer suggested.

It remains to be seen whether Microsoft will be able to collect on its claims or if the open-source community will use them to strive for patent reform, currently a popular issue before the U.S. Congress. However, the claims certainly will raise important issues around how patent-infringement cases will be litigated in the future, said Paul Lesko, head of the IP litigation group at SimmonsCooper LLC in St. Louis.

Linux evangelist Eric Raymond seems to think the patents at issue fall under the latter category. “It is nearly as certain that those patents are all junk,” he said in an e-mail interview. “If Microsoft had sound and critically relevant patents to assert, they wouldn’t need to screw around with vague threats. They’d simply publish the patent numbers and it would be game over for Linux.”

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Microsoft takes on the free world

Published
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Ryan Petty
on 14-May-2007
in Innovation, Microsoft and Politics
. Comments

Microsoft claims software like Linux violates its patents

Microsoft claims that free software like Linux, which runs a big chunk of corporate America, violates 235 of its patents. It wants royalties from distributors and users. Users like you, maybe.

Folks, it is time to take a stand. Yes, everyone is doing it (see patent activity chart), but that doesn’t make it right. I have quoted extensively from this well written article. Of course, Microsoft likes to play both sides of the issue, with their arguments carefully crafted to support their MBAs (Microsoft Benefit Analysis). Once again, innovation takes a back seat when Microsoft steps in.

Free software is great, and corporate America loves it. It’s often high-quality stuff that can be downloaded free off the Internet and then copied at will. It’s versatile - it can be customized to perform almost any large-scale computing task - and it’s blessedly crash-resistant.

A broad community of developers, from individuals to large companies like IBM, is constantly working to improve it and introduce new features. No wonder the business world has embraced it so enthusiastically: More than half the companies in the Fortune 500 are thought to be using the free operating system Linux in their data centers.

But now there’s a shadow hanging over Linux and other free software, and it’s being cast by Microsoft. The Redmond behemoth asserts that one reason free software is of such high quality is that it violates more than 200 of Microsoft’s patents. And as a mature company facing unfavorable market trends and fearsome competitors like Google, Microsoft is pulling no punches: It wants royalties. If the company gets its way, free software won’t be free anymore.

The free world appears to be uncowed by Microsoft’s claims. Its master legal strategist is Eben Moglen, longtime counsel to the Free Software Foundation and the head of the Software Freedom Law Center, which counsels FOSS projects on how to protect themselves from patent aggression. (He’s also a professor on leave from Columbia Law School, where he teaches cyberlaw and the history of political economy.)

Moglen contends that software is a mathematical algorithm and, as such, not patentable. (The Supreme Court has never expressly ruled on the question.) In any case, the fact that Microsoft might possess many relevant patents doesn’t impress him. “Numbers aren’t where the action is,” he says. “The action is in very tight qualitative analysis of individual situations.” Patents can be invalidated in court on numerous grounds, he observes. Others can easily be “invented around.” Still others might be valid, yet not infringed under the particular circumstances.

Moglen’s hand got stronger just last month when the Supreme Court stated in a unanimous opinion that patents have been issued too readily for the past two decades, and lots are probably invalid. For a variety of technical reasons, many dispassionate observers suspect that software patents are especially vulnerable to court challenge.

Furthermore, FOSS has powerful corporate patrons and allies. In 2005, six of them - IBM (Charts, Fortune 500), Sony, Philips, Novell, Red Hat (Charts) and NEC - set up the Open Invention Network to acquire a portfolio of patents that might pose problems for companies like Microsoft, which are known to pose a patent threat to Linux.

FOSS developers, who do not have the resources to defend themselves against a Microsoft patent suit, felt safe as long as powerful corporate Linux users shared their cause. But now the big boys could just buy their Linux from a royalty-paying vendor like Novell, getting protection from lawsuits and leaving the little guys to fend for themselves. What the shortsighted corporate types didn’t grasp was that without the little-guy developers there might not be any high-quality FOSS for them to use five years down the road.

Microsoft’s big nightmare: free online apps

Moglen had another card to play. In his view, the fact that Microsoft was selling coupons that customers could trade in for Novell Linux subscriptions meant that Microsoft was now a Linux distributor. And that, as Moglen saw it, meant that Microsoft was itself subject to the terms of the GPL. So he’d write a clause saying, in effect, that if Microsoft continued to issue Novell Linux coupons after the revised GPL took effect, it would be waiving its right to bring patent suits not just against Novell customers, but against all Linux users. “I told Brad,” he recalls, “‘I think you should just walk away from the patent part of the deal now.’”

Smith didn’t, and Moglen kept his promise. On March 28, the Free Software Foundation made public revised GPL provisions, which are expected to take effect in July.

Microsoft and Novell both vow to proceed with their deal as planned. Microsoft claims that its mere distribution of coupons won’t make it subject to the GPL, as Moglen asserts. But even if Microsoft is right about that, there’s no doubt that distributors remain subject to it, and Moglen’s revisions will bar them from trying to strike deals like Novell’s.

That may be bad news for big corporate customers, which, judging from early reports, like the Novell deal. Presumably at least part of its appeal is that it provides peace of mind about Microsoft’s patent claims. In the first six months, such marquee clients as Credit Suisse, Deutsche Bank, AIG Technologies, HSBC, Wal-Mart, Dell and Reed Elsevier have all acquired Novell Linux coupons from Microsoft.

Microsoft had hoped that the Novell deal would become a model it could use to collect patent royalties from other distributors of free software. In that respect, its “bridge” to the free world appears to have failed. That, in turn, seems to have taken us a step closer to patent Armageddon.

“The only real solution that [the free-software] folks have to offer,” Smith says, “is that they first burn down the bridge, and then they burn down the patent system. That to me is not a goal that’s likely to be achieved, and not a goal that should be achieved.”

When it comes to software patents, though, Moglen thinks that’s exactly the goal to be achieved. “The free world says that software is the embodiment of knowledge about technology, which needs to be free in the same way that mathematics is free,” he says. “Everybody is allowed to know as much of it as he wants, regardless of whether he can pay for it, and everybody can contribute and everybody can share.”

In the meantime, with Microsoft seemingly barred from striking pacts with distributors, only one avenue appears open to it: paying more friendly visits to its Fortune 500 customers, seeking direct licenses.

If push comes to shove, would Microsoft sue its customers for royalties, the way the record industry has?

“That’s not a bridge we’ve crossed,” says CEO Ballmer, “and not a bridge I want to cross today on the phone with you.”

I wonder why not, Steve?

UPDATE: Response has been swift and almost unanimously against Microsoft.

More from the Seattle-PI

Mary Jo Foley’s reaction over at ZDNet

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Is a $200 Billion Suit Headed Microsoft and Apple’s Way?

Published
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Ryan Petty
on 12-May-2007
in Apple, DRM, Innovation and Microsoft
. Comments

Is a $200 Billion Suit Headed Microsoft and Apple’s Way?

All I can say, for fear of being sued, or should I say it, for fear of being sued for NOT saying it??? We have sunk to a new low…

With the rise of intellectual property (whether it be patents or content, like Pirates of the Caribbean, for example) has come a rise in the number of patent suits. Unfortunately, this has meant the emergence of companies like Acacia Technologies, which has used the IP laws to its advantage, acquiring patents and filing lawsuits against any number of industries, including porn providers.

The way a suit usually works, however, is that Company A sues Company B for “infringing” upon its technology, or using it illegally. On Friday, however, a startup sent a number of cease-and-desist letters to several tech bigwigs (Microsoft, Adobe, Real Networks and Apple) accusing them of not using their technology. This could be a first.

According to a press release, a company called Media Rights Technologies and BlueBeat.com, an Internet radio station that is owned by MRT, said that it has developed and tested the X1 SeCure Recording Control, a technology to prevent digital audio streams from being “ripped,” or copied.

What MRT claims, however, is this: “MRT asserts Apple, Microsoft, Real and Adobe have produced billions of these products without regard for the DMCA or the rights of American Intellectual Property owners, actively avoiding the use of MRT’s technologies. Failure to comply with this demand could result in a federal court injunction to any of the above named parties to cease production or sale of their products and/or the imposition of statutory damages of at least $200 to $2500 for each product distributed or sold.”

What this says to me is that the companies may be sued for not infringing upon MRT’s technology, a rather novel take.

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Big Paychecks - Forbes.com

Published
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Ryan Petty
on 9-May-2007
in Apple
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Big Paychecks - Forbes.com

The chief executives of America’s 500 biggest companies got a collective 38% pay raise last year, to $7.5 billion. That’s an average $15.2 million apiece. Exercised stock options again account for the main component of pay, 48%. The average stock gain was $7.3 million.

The highest-paid boss of the 500 companies we tracked: Apple (nasdaq: AAPL - news - people ) chief Steve Jobs. He drew a nominal $1 salary but realized $647 million from vested restricted stock last year.

Nice job Steve! Now, please reconsider that Cingular/AT&T exclusivity nonsense for the iPhone.

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Set-top Boxes Open Up

Published
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Ryan Petty
on 8-May-2007
in Innovation and Microsoft
. Comments

Set-top Boxes Open Up

“However, many assert that it’s Microsoft Corp. –which doesn’t make STBs and is often accused of attempting to lock in users to its own priority technologies %u2013 that has done the most to advance the role of the set-top box. “

I always love it when a writer makes a vauge reference to some nebulous 3rd party like “many”. Who are these “many”? “However, many assert that it’s Microsoft Corp. – which doesn’t make STBs and is often accused of attempting to lock in users to its own priority technologies – that has done the most to advance the role of the set-top box.However, many assert that it’s Microsoft Corp. – which doesn’t make STBs and is often accused of attempting to lock in users to its own priority technologies – that has done the most to advance the role of the set-top box.”

I have never met anyone, anywhere that would assert Microsoft has ever done anything but “open” hardware in an attempt to dominate a market. Microsoft creates the appearance of openness while denying to others the benefits thereof.

While multi-function devices like the Xbox 360 are very interesting and may help IPTV service providers differentiate service, remember this too is a Microsoft controlled platform.

Technologies such as OCAP provide a level playing field for a number of companies wishing to innovate on a cable operators network. While OCAP may not prove to be a panacea, technologies such as OCAP, where everyone has access to the platform, will do more to open up the STB market than anything Microsoft has ever or will ever do.

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Sometimes Steve Ballmer Just Takes Your Breath Away

Published
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Ryan Petty
on 2-May-2007
in Apple, Innovation and Microsoft
. Comments

InformationWeek Blog | Sometimes Steve Ballmer Just Takes Your Breath Away

Very insightful article which helps blow past the Ballmer spin machine. Of course, Ballmer has such an “historic” perspective on Microsoft’s success.

In a USA Today interview Microsoft CEO Steve Ballmer is asked if he wishes consumers would get as passionate about Microsoft as they do when Apple comes out with something new. “It’s sort of a funny question,” he answers. “Would I trade 96% of the market for 4% of the market? I want to have products that appeal to everybody.” Steve, I’ve got one word for you: iPod.Ballmer wants to see the “my-OS-on-everybody’s-hardware” model play in the mobile phone space the way it has in the desktop-computer space. I am afraid, however, that’s not a forward-looking idea, it’s backward-looking wishful thinking.

Of course what was interesting to me was the low market share numbers for Windows Mobile devices, 5.6%. I must admit, for the past 6 months or so, I have been a Windows Mobile users–although not a happy one.

At the same time, while desktop PCs aren’t exactly going away, they’re being pushed to one side in the marketplace by other devices, and Ballmer can only dream about 96% of the market for cell phone operating systems. On the small percentage of phones that are smartphones — that is, they run applications — Microsoft’s Windows Mobile runs a distant third behind Symbian and Linux world-wide, according to figures on Wikipedia. (The breakdown is given as Symbian OS 72.8%, Linux 16.7%, Windows Mobile 5.6%, RIM 2.8%, and Palm OS 1.8%.)

If the enterprise market is at all on the iPhone’s radar screen, the key to breaking the Microsoft habit is to break the dependency on the Exchange/Outlook duopoly. There are a lot of enterprise buyers out there drooling over the iPhone and they have access to the corporate purchasing card, but they won’t buy the iPhone if they can’t get the corporate email. Since you can’t get Exchange out overnight, Apple, meet Blackberry/Blackberry meet Apple.

Furthermore, products like SharePoint should be seen for the evil they really are–and banished from all companies. It remains to be seen if products like Scalix, the Google office suite, or my personal favorite, Zimbra can gain market share in the collaborative software space. Only by breaking the Exchange/Outlook stranglehold on the enterprise, will Apple have a shot at piercing the enterprise market.

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Ballmer Says iPhone Won’t Succeed. Has Windows Mobile?

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Ryan Petty
on 2-May-2007
in Apple and Microsoft
. Comments

InformationWeek Blog | Ballmer Says iPhone Won’t Succeed. Has Windows Mobile?

Steve Ballmer seems to be full of bluster these days. In his latest potshot at the iPhone, the Microsoft CEO says, “the future of the mobile handset business will primarily depend on software influence rather than hardware.” In other words, Apple’s hardware approach to sales won’t work and Microsoft’s software approach is better. Let’s take a real look at the success of Windows Mobile’s software-drive success, shall we?

Fellow bloggers Stephen Wellman and David DeJean quoted a passage from Ballmer yesterday in which he says he’d rather have Microsoft software on 60% or 70% of the phones in the world than meet the hardware sales goals of Apple’s iPhone. Apple CEO Steve Jobs said at the iPhone’s launch that he would like to see the iPhone represent 1% of all mobile phone sales by the end of 2008. That’s 10 million devices. So he’s giving Apple 18 months (assuming a June launch) to reach that goal. I won’t say that it isn’t an ambitious goal. Given Apple’s success at selling iPods, I will reserve judgment for now on the iPhone’s real potential.

With the smartphone market approximating 10% of all mobile phone sales, it amounts to roughly 100 million devices sold per year. Of those 100 million, Windows Mobile appears on 5.6%, or 5.6 million of them. So, in the 5 years that Windows Mobile has been around, it has barely cracked 0.6% of all mobile phone sales. Ballmer has a long, long way to go to reach his target of 60%.

In light of Windows Mobile’s success, or lack thereof depending on your point of view, I’d say Ballmer doesn’t have all that much to crow about. In fact, if Apple does meet its hardware sales goals by 2008, which would best the number of Windows Mobile-powered devices by about 4 million, Ballmer will be forced to eat crow.

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