Microsoft Engages its Opponents

Let's give Microsoft some credit for a change. Rather than continuing to lash out at its opponents, it's starting to engage them. In Europe, for instance, Microsoft tried for more than a year to negotiate a settlement with the commission's competition bureaucrats before talks broke down over their unreasonable demands for controlling the company's long-term conduct.

Meantime, Microsoft is settling several of the 35-plus patent-infringement lawsuits brought against the company since 1998. Its grandest gesture was last month's $1.95 billion deal with Sun Microsystems, which not only ends Sun's antitrust suit against Microsoft, but also calls for the two bitter rivals to share technology. This month, Microsoft settled with InterTrust Technologies, agreeing to pay the digital-rights management company $440 million for access to its technology. Those deals follow Microsoft's earlier settlements with, among others, Time Warner on Web browsers, Immersion Corp. on game software and AT&T on voice-recognition technology.

Still Looking Out for No. 1

Are we seeing a kinder, gentler Microsoft? Not really. Microsoft doesn't do anything that's not in its best interests, and in this era of IT belt-tightening, it understands that customers have run out of patience with vendors whose incessant squabbling ensures incompatible standards and technologies. Either Microsoft starts playing nicer with others or its customers start looking elsewhere.

CEO Steve Ballmer is talking a good game, touting Microsoft's maturation into post-adolescence (adulthood?). "Isn't adolescence when you grow really fast and you can sometimes be a little raucous?" he bantered with BusinessWeek. "And then when you get into your prime, you're just hitting on every cylinder, you're having a great life, you're creating a family, you're rising to new responsibilities."Before we're comforted by Papa Ballmer, however, let's see Microsoft make good on its promise to foster interoperability with Sun systems, and then establish some semblance of peaceful coexistence with the Linux community; shore up security in all its enterprise-software products instead of streamlining patch management; and dip into more of its $53 billion cash hoard to settle the remaining patent suits that stand in the way of its focus on Longhorn, the next version of Windows, whose release date is slipping past 2006.

After averaging revenue growth of well more than 30 percent a year through the 1990s, Microsoft is now moving at less than half that pace. If it can't find a way to reignite customer passion, in part by subverting its instincts to conquer and divide, maturing will just mean getting old and slowing down.

Rob Preston is editorial director of NETWORK COMPUTING. Write to him at [email protected].