Law & Internet Cultures :: Kathy Bowrey
:: Chapter Five: In a world without fences who needs Gates?
In exploring privately constituted power most commentators are suspicious of large proprietary corporations and their global political influence. Microsoft seems to play a symbolic role in much of this discourse. We need to understand why this is.
- If Microsoft is that influential, and if so, what are the consequences?
- Does law foster or facilitate this power?
- Assuming that it wants to, how can law regulate this form of power, and if so, to what end?
The objectives of this class are to explore:
- Why Microsoft? Why is it that this particular corporation attracts so much attention and generates so much controversy, compared to other large successful IT firms?
- Is there such a thing as a corporate business philosophy?
- If law seeks to foster innovation, can it do so neutrally?
- Are there ideological and practical limits in law seeking to control large, successful, flag-bearing technology corporations?
- What is the role of the media, the marketplace and the public as an adjunct to regulation?
- How might IT outsourcing affect perceptions of globalisation and the notion of who benefits from the information economy?
Let’s begin by looking at some of the anti-Microsoft websites:
- Why I hate Microsoft
- The Microsoft Boycott Campaign
- Anti Microsoft Association
- KMFMS, “What's So Bad About Microsoft?”
Perhaps with the anti-trust litigation moving onto a resolution there is less interest in this material today. Some sites, such as The MSBC Superlist of Anti-Microsoft Web Sites, are archiving in case this material is lost:
“The Anti-Microsoft Archive is our 'museum' of high quality anti-Microsoft material that is no longer being updated. The contents of this site were originally located on other servers scattered around the Internet, and were at risk of disappearing without our intervention. The sites featured here were carefully chosen by the MSBC editors - we have no intention of archiving every anti-Microsoft site there is, only a few of the highest quality examples. Nonetheless, if you know of an endangered anti-Microsoft site, don't hesitate to contact us and we will at least consider adding it to this collection.”
Though fewer sites, there are is also “pro” Microsoft advocacy. Some, such as the once called Committee for the Moral Defense of Microsoft, now called The Center for the Advancement of Capitalism are not parodies, but perhaps they deserve to seen as such? The Ayn Rand Institute Microsoft defense site calls Microsoft "today's prime example of what Ayn Rand called "America's Persecuted Minority."
When Microsoft-loving and Microsoft hating itself becomes an object of parody and a popular culture subject in its own right, it deserves some attention.
What drives this kind of interest in the corporation?
Why isn’t there the same level of attention in other successful corporations?
A little test
- Who uses a computer at home and at work?
- What operating system do you use?
- What browser do you use?
- Who wrote the Operating system for your mobile phone?
- What about the processor for your digital camera?
- Do you have an opinion about Microsoft?
- Do you also have an opinion about Intel?
- What is the reputation of IBM? of Apple? of Adobe?
- What do you know about other software or hardware manufacturers?
- What do you know about Bill Gates?
- Very wealthy (Forbes says $46.5 billion; self made; uni drop out; big philanthropy ($27billion)
- How do you know that?
Today’s class tries to understand why there are so many stories about Microsoft and Bill Gates. Eg. Co-founder Paul Allen is ranked number 7, has a net worth of $21 billion sourced from Microsoft and investments. He is also listed as a uni drop out. What do you know about Larry Ellison? He is described by Forbes as “Chicago native co-founded database software firm Oracle in 1977 and took it public in 1986, one day before Microsoft; nipping at rival's heels ever since. Touts Darwinian view of software industry, decreeing that all but the largest players are doomed”. Also described as “self made” and a “uni drop out” now worth $18.4 billion but was worth $58 billion in 2000 (Oracle software runs on Sun’s Linux machines).
- Why don’t we know more about these people?
- Should we?
For more detail you might like to explore the Forbes lists.
- Who has used a non-Microsoft operating system?
- Who decided which version of that OS would be used?
- Who has used word processing packages other than Microsoft Office? Or browsers other than Explorer?
- How were decisions about what technology was to be installed made?
- Who made the call? After what consultations? What drove the decision?
- Why do those who use computers regularly, but don’t necessarily understand them very confidently, still have opinions about Microsoft?
And why is that whereas we might accept the limitations of a particular microwave, eg. it is too small so we will replace it, place different expectations on computing technology. Do we treat software differently?
Our computing experience is confounded by continual media exposure to how fabulous, seamless and, of course, user friendly the latest version of the technology is supposed to be. It is not just all about consumers wanting new features and innovative product. We are marketed all the time, selling the new, the fantastic, the breakthrough we have to have.
You only need to work with computers for a very short time to know that whatever version of machine or software, it is never as good as the ads suggests it will be, or perform as well for us as it does for someone with much more sophisticated computer skills than ours. We all know that with the new advantages, there are usually new problems to overcome. The graphic interface is nicer, but the page isn’t printing like it did before. Is this kind of experience - the bugs, the unmanageable size of the program features, the annoying pre-set preferences and unwelcome “help” - the effort to maintain functionality - a cause of broader popular interest in Microsoft?
- Do you need any particular knowledge, skill or experience to have an opinion about a software maker?
- What knowledge do you need to talk about Microsoft’s role in the IT industry, or in the global economy?
- What background knowledge do you need to understand the anti-trust actions against the corporation?
Where do you want to go today?™
Chapter Five argues that one of the reason Microsoft attracts so much attention relates to Bill Gates’ adopting the role of Captain of Industry. He gives speeches, writes books, designed not just for inner circles, but reaching out to the broader public. There are quite a few public speeches by Bill Gates on his
Microsoft website. Let’s look at a recent one,
“The spirit of Moore's Law has taken processing power from kilohertz to gigahertz, storage from kilobytes to terabytes, and networking speed from mere bits per second to gigabits per second.
Computers have moved out of the IT department into almost every part of our lives. More than 600 million PCs are in use today, a number that will rise to more than a billion in the next five years. Many devices we use every day--from mobile phones to TVs--are becoming like computers, with processing power, storage, and connectivity that meets or even beats the high-end PCs of just a few years ago.
Yet we're only beginning to realize computing's potential. I believe that we're entering an era when software will fundamentally transform almost everything we do.”
We should also reflect on discourses on technological determinism here, sketched in the material on Chapter Three. Can software have “potential”?
In Chapter Five I quote from Bill Gates’ books on the nature of innovation and the information economy.
- Does he have a distinctive corporate business philosophy or ideology?
- Who benefits from innovation?
- How is Gates’ position different to other positions that we explored in Chapter two on the nature of the information economy and its benefits?
- What is a “knowledge producer” and what does that have to do with the information economy?
What drives innovation?
What do you make of these 1998 comments by Bill Gates, Who Decides What Innovations Go Into Your PC? :
“If you asked customers who they would rather have deciding what innovations go into their computer - the government or software companies - the answer would be clear. They’d want the decision left to the marketplace, with competition driving improvements.
This is the question at the center of the Justice Department’s recent action aimed at forcing Microsoft to remove Internet Explorer from Windows. In this instance, consumer benefits seem to be less important than the complaints of a handful of our competitors who want the government to help them compete - by preventing Microsoft from enhancing its products.”
The reason we started this class with a reference to your own computing choices relates to the issues at the heart of the anti-trust action, which drew upon academic economic discourses about consumer behaviour and the naturalness of monopolies in technology markets. But before we discuss those there are more preliminary issues about the role of law in the marketplace and the place of government intervention.
- What is the role of law in self-regulation?
- What is the role of government in self-regulation?
- How do you understand Microsoft’s success in the marketplace?
- Why did the Department of Justice go after them?
- What were the difficulties they faced?
There is a general overview of the US Anti-Trust litigation with links to some of the judgments at Wikipedia.
- US Department of Justice Anti-Trust Division .
- Consumer Project On technology Microsoft pages.
- Groklaw Microsoft Litigation Resource Page.
- Microsoft Implementation of European Commission Decision.
There are also a very large and still growing number of books about the trials.
One of the more complex aspects of the case is determining what a “naturally” functioning IT marketplace looks like, and what constitutes cause for “intervention”. Economic theorists have various views on this and there are a number of research sites dedicated to explaining markets and the information Economy.
- Nicholas Economides US v Microsoft pages including jargon and papers on network effects
- Hal Varian’s Information economy resources
- Stan Liebowitz, Network Effects, Path Dependence, Lock-In, and Digital Copyright Issues
However the problem I find with this literature is where it interfaces with law. Law is largely absent from the picture or treated as neutral, except when it comes to dealing with anomalous conduct. However law and legal power, in the form of licenses and related contractual terms, is ever present in the marketplace. There are no obvious limits to the code that comprises the basic commodities in the information economy.
- How do we know what the “markets” are for IT products?
- Is there an operating system market? A browser market?
- Who are the players, and what are the products?
- Should there be limits to the amount of code that can be licensed together?
- Or is it not a problem of size but functionality? Or is it a problem of neither but the bargaining conditions of access to code?
- Who or what determines the conditions of access?
- How does this impact on innovation?
The pace of change
In some discourses information technologies have become synonymous with the idea of rapid development of innovation and uncomplicated distribution of its benefits to the public at large. The self made, instant entrepreneurial mega success stories that permeate internet cultural history are partly to blame here. We were constantly exposed to simple tales of individual talent, instantly recognized by the marketplace, leading to ever greater investment, phenomenal growth and success.
While the District Court clearly rejected the simple tale of successful innovation as the cause of Microsoft’s market power, how can law intervene to right wrongs to the “potential” of innovation?
- Is this not also courting a technologically determinist and ideologically loaded point of view?
- Is it the time lag factor that is most difficult to deal with?
- Or is it a lack of evidence - and more than is usually the case?
- What responsibility do others in the industry have to the courts? To the public?
See John Heilemann, Fear and Trembling in Silicon Valley, Wired 8.03 March 2000.
See John Heilemann, The Truth, The Whole Truth, and Nothing But The Truth” Wired 8.11 Nov 2000.
- How do you understand the role of the media in the Microsoft litigation?
- Was it a case of Judge Jackson hankering for celebrity status?
- Do such actions undermine public confidence in court processes?
- Can the media be relied on as an adjunct to the legal power, or are they an alternate disciplinary force?
- How much does the profile of the corporation and its Chairperson, and the roles of Microsoft in popular culture, affect the operations of law?
- Has the reputation or standing of the corporation been affected in the longer term by the trial?
- What do you think the anti-trust action means, beyond the strict terms of the settlements, in the US and abroad?
- Did it provide a boost to the open source movement?
- Has it fueled anti-globalisation actions or concerns for US power abroad?
Consider these sites:
- Islam Online.net. “Anti-Globalization Forum Moots Alternative to WTO”, 17 Jan 2004
- Anti globalization march brings Mumbai to a standstill The Guardian 21 Jan 2004
- Overseas Invasion Mother Jones, Jan/Feb 1998
Clearly Microsoft is only one of many large corporations involved in outsourcing, made possible by reliable global communications technologies. One of the most bizarre tales to date involves the reports of Offshoring to a ship in international waters.
I am interested in outsourcing as a phenomenon of globalisation, as part of understanding possibilities for more calls for action or intervention in regulating the information economy, and for understanding who benefits from wealth generation. It is also another site where law and sovereignty is seen to be challenged, because of the freedom of the information and money flows.
- Is outsourcing likely to affect ideals of citizenship, consumer behaviour?
- Does it affect perceptions of corporate power?
- How does it affect the IT marketplace?
- Is this a likely hotspot for future legal and political activity?
For more on outsourcing see