News

Meta: Users Should Expect Business as Usual from Microsoft

• By Scott Bekker
• July 09, 2001

"Users that were delaying decisions on how to react to Microsoft's new software licensing schemes -- in part to see if Microsoft will be broken up and become a marginalized company in five years -- should now plan based on the expectation that Microsoft will retain its present position and power in the industry," read the analysis, written by 10 Meta Group analysts.

The Appeals Court overturned U.S. District Judge Thomas Penfield Jackson's order to break Microsoft into an applications company and an operating systems company. The appeals court also gave Microsoft more latitude than Jackson did to bundle products and features into the operating system. However, the court upheld Jackson's finding that Microsoft abused a monopoly in desktop operating systems.

"Users should expect Microsoft to continue developing its products as planned, with no major alterations due to legal concerns. If any change occurs, it would likely be in the direction of deeper technology integration," Meta Group said in the analysis released this month.

Meta Group expects Microsoft to proceed to bundle MSN Messenger with Windows XP and to go ahead with plans for HailStorm, Redmond's first generation of .NET Web services.

While some observers have made much of Microsoft's decision to pull Smart Tags out of Windows XP, Meta Group finds the decision not wholly motivated by PR and legal concerns with the antitrust case. "The Smart Tags decision was motivated in large part by security concerns, because Microsoft has yet to develop a way to adequately protect Windows XP from the malicious insertion of viruses disguised as Smart Tags," the analyst firm says. "We expect Microsoft to reintroduce Smart Tags as a Windows and Internet Explorer feature in the future."

Due to antitrust perceptions, Meta does believe Microsoft needs to be careful in the way it proceeds with Smart Tags, also currently available in Office XP.

The vendors most damaged by the Appeals Court decision were AOL, RealNetworks and Sun Microsystems, Meta Group finds, because all three lie in the way of Microsoft's planned platform extensions.

Microsoft threatens AOL with its instant messaging product and Smart Tags; RealNetworks with its Windows Media Player, which will be tightly integrated in Windows XP and HailStorm; and Sun with its languages and development tools.

Despite all that, Meta Group holds out hope that Microsoft has learned from the case.

Although Microsoft remains aggressive in its defense and unapologetic regarding its product development decisions, it has been chastened with regard to the way it deals with other vendors. Microsoft has realized that it must be more careful to avoid the appearance of using its monopoly power over the desktop unfairly, and that it must be concerned with market perceptions," Meta Group finds.

Related Articles:
A Bundle of Trouble? Implications Persist for XP, .NET
Tea Leaf Time: What's Next in the Antitrust Case?
Users Greet Antitrust Decision with a Yawn
Appeals Court Revokes Jackson's Break-Up Order