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Microsoft's Annual Report Reveals OSS Mistakes 348

mjasay writes "Microsoft's most recent annual report suggests that the company is increasingly coming to grips with open source, yet also seems determined to perpetuate myths about open source that poorly serve it and its shareholders. Microsoft CEO Steve Ballmer has suggested before that 'free software means no free soda' for Microsoft employees; but this is perhaps the first time that Microsoft has managed to enshrine its ignorance in a public document. In the annual report, Microsoft makes two primary false claims about open source: 1) Open source companies don't invest in research and development and instead largely free-ride on Microsoft's patents and copyrights; and 2) Open source projects don't innovate and instead mimic Microsoft's products. Perhaps Microsoft has forgotten its own 'innovative' past copying of markets and technologies created by Apple and others. But at least Microsoft gets one thing right: 'To the extent open source software gains increasing market acceptance, our sales, revenue and operating margins may decline.'"
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Microsoft's Annual Report Reveals OSS Mistakes

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  • nothing to see here (Score:5, Informative)

    by Anonymous Coward on Sunday August 03, 2008 @11:08PM (#24461875)

    A 10K report is *supposed* to have a section where the CEO lays out, in gory detail, external threats and situations on the horizon that have a significant chance of derailing their revenue plan for the next year.

    What Ballmer is saying here is that

    1. competitors don't have to attack Microsoft broadside, as they have the luxury of going after a niche market
    2. they have the fast follower's advantage of being able to use Microsoft's products, rather than having to do the early R&D themselves (the same advantage that Microsoft once had against Apple, Lotus, and Netscape)
    3. some of the most dangerous competitors are in open source, because they can't be finished off the same way that Microsoft crushed its competition in the '80s and '90s.

    IIRC it was Marc Andressen who first hit on this tactic for competing against Microsoft, when Netscape launched the Mozilla Foundation in 1998. It took a few years of fumbling around before that took fruit - probably because the Navigator/Communicator code was so badly written - but that turned out to be a masterstroke of business tactics.

  • by Anonymous Coward on Sunday August 03, 2008 @11:19PM (#24461953)

    Have you used Firefox?

  • Re:Damn parasites (Score:5, Informative)

    by Wolfbone ( 668810 ) on Sunday August 03, 2008 @11:46PM (#24462137)
    Yes, well they're not just wrong to say that FOSS never innovates, they've actually acquired patents bearing on innovations (probably) originally made by FOSS (such as the Enlightenment pager, fundamental aspects of RSS, ICCCM-like extended clipboard formats etc.) As far as I know they haven't yet used any of these patents to steal (no inverted commas) a FOSS developer's own invention and work, but it is not impossible or inconceivable that they might. Their claim that FOSS 'steals' or free rides on their copyrighted [wtf?] and patented "intellectual property" is simply despicable.
  • Re:Damn parasites (Score:5, Informative)

    by Maxmin ( 921568 ) on Sunday August 03, 2008 @11:50PM (#24462157)

    The parent post is right, Microsoft has incorporated BSD-derived code into its operating systems [kuro5hin.org].

    The web browser and web server were concepts and implementations that originated within the open-source community.

    If MS is accusing the open-source community of absconding with its intellectual property, then why no compunction about incorporating same into their products?

    Software *ideas* are just that, ideas. They should not be patented, or patentable, but that's just what's happened and has been encouraged by USPTO. Companies like MS (and many others) rode that bandwagon and have patents that one might call dubious.

  • by Darkness404 ( 1287218 ) on Monday August 04, 2008 @12:10AM (#24462261)

    Open office is a bad replica of Microsoft Office.

    Remember how hard it was getting people to switch from a CLI to a new GUI back when the first Macs were coming out? Getting people to migrate to Windows from DOS? It was hard. Now change the interface of someone's most used program, it is the same thing over again. Plus, OOo looks nothing like Office 2007, and that is part of the reason it is being adopted.

    Sharp Develop is a bad replica of Visual Studio.

    Again, people use familiar things.

    Firefox 3 search bar and navigation button interface is derived from that of IE.

    There are only a certain number of ways to improve something. For once IE got something somewhat right, so the Firefox developers took that and changed it. Guess what? The tabs in IE 7 are similar to Firefox's, which are similar to Opera's. And as for the UI, it mostly has stayed the same from Netscape onwards, and just about every browser has adopted it.

    Linux desktop are inharently trying to copy Windows day by day.

    Ummm... Yah. Wrong. First, take a default install of Ubuntu, one of the most popular Linux distros, you get, 2 taskbars, not like Windows, you get a package management tool, not like Windows, you get pre-installed programs for advanced image editing, word processing, etc. not like Windows. Ok, sure, you have a button on your window manager to close, minimize or maximize your window, but that is about where the similarities end.

    And that isn't even dealing with the technical differences.

  • by Anonymous Coward on Monday August 04, 2008 @12:11AM (#24462267)

    Outside of development tools what major innovations has OpenSource produced?

    Oh, just...

    Linux Kernel - one of the worlds most stable kernels

    LaTeX - Publishing industry standard

    Apache - Web server, hosts large percentage of the internet

    Blender - Need I say more?

    Amarok - as above.

    I could keep going...

  • Re:Damn parasites (Score:5, Informative)

    by Maxmin ( 921568 ) on Monday August 04, 2008 @12:12AM (#24462279)

    Neither the web browser or tabbed browsing originate from open source projects.

    False. Somewhere around here I've still got a spool with a copy of the NCSA server and Mosaic sources [wikipedia.org] from way back when. And lookee here, you can still download Mosaic source for X Windows [uiuc.edu], version 1.2 in the directory called 'old'.

    A quick read of the web's history [wikipedia.org], such as the Tim Berners-Lee book Weaving the Web [w3.org], and you'd *learn* that the first web browser was, in fact, open-source.

    That's what the internet was founded on, open principles, not proprietary, though proprietary wasn't ever excluded. Much of the internet's infrastructure was proprietary early on, and still is. But if you're going to assert that open source software is nicking code and patents from proprietary, let's see some evidence, eh?

    Don't know about tabbed browsing, though it's plain for anyone to see that MS was late to that party, and brought with it a very clunky implementation.

  • What innovation (Score:5, Informative)

    by fermion ( 181285 ) on Monday August 04, 2008 @12:15AM (#24462303) Homepage Journal
    For the most part, MS has bought what is mostly mature technology and made it accessible to the mass market. This is useful, but not innovation. Most of it's problems come from the fact that it is not a super high tech company. It is a medium tech company that provides good components for inexpensive solutions to common problems. This is the second problem. MS does not provide solutions. It is up to third parties to hack together solution to common problems from proprietary MS components and commodity third party components. This can be an efficient method to problem solve, but can be expensive as the MS proprietary solutions are becoming less competitive, and the cost savings are increasingly coming from third party commodity products, products that can run non-proprietary software. A MS certified team to make everything work is not cheap either.

    So what MS is and has been saying is that it acquired the IP fair in square, and is properly selling it on the market, while others are just copying. Let us not dwell on the fact that is where MS was 20 years ago when Apple acquired the WIMP interface fair and square and MS copied it to run on cheaper hardware, which let us remember that Compaq created at no small expense fair and square. No, let's just look at the claims as they stand using a classic example, SQL

    SQL server was aquired acquired from sybase. Is there technology here that MS can claim was part of that deal, and stolen by the OSS community. I think not. SQL was developed by IBM and what is now Oracle, and was standardized, I believe, in the mid 80's. The two big OSS competitors, mSQL and PostreSQL were both independently developed by teams concurrently with the Sybase product and opensourced, partly or otherwise, by their creator. I am sure that both not include features that MS SQL has, but I would also guess that Oracle or IBM has the features first.

    In the end MS problem is simply that they are not 2-3 years ahead of the curve. When this happened to SGI, they went bankrupt. A firm simply cannot charge a premium for this years technology. In the case of software, this is because the OSS people can do the same thing, for free. MS Office is simply too mature to be a profit center. MS Server is simply relatively too low tech. Even the X Box is not at the front of the pack, at least not by more than six months.MS has some traction through collaboration, and they can continue to make money there, but complaining about the loss os MS Windows market share is silly. They had the chance the database file system, but for some reason they did not provide enough resources. This in itself proves that they are not innovative.

    MS will lose customers because they are lazy. They will continue to have enterprise customers, they will continue to have the gaming market. We will see the general desktop and server market move away from them unless they come up with something big or go back to their roots as the cheap solution. We see this in the emerging $100-$200 portable market. If this will provide the growth the stock market wants is yet to be seen.

  • Re:Damn parasites (Score:4, Informative)

    by nawcom ( 941663 ) on Monday August 04, 2008 @12:29AM (#24462385) Homepage

    http://www.google.com/search?hl=en&safe=off&q=%22The+Regents+of+the+University+of+California%22+intitle:Source+site:research.microsoft.com&start=40&sa=N&filter=0 [google.com]

    Sorry bout that - looks like google filters out some of them. This should list (hopefully) all of them.

  • Re:Damn parasites (Score:0, Informative)

    by th3rtythr33 ( 1191409 ) on Monday August 04, 2008 @12:30AM (#24462391)
    Tabbed browsing came from iBrowse, which is not open source. Mosaic was not open source. The IP stack was definitely not open source.
  • Re:Ad Hominem (Score:3, Informative)

    by ivan256 ( 17499 ) on Monday August 04, 2008 @12:46AM (#24462487)

    Aside from the mouse, and icons, Apple really got very little from Xerox. The Xerox UI didn't have user positioned or sized windows. It didn't have the concepts of double clicking, or dragging. It didn't have the contextual menu bar that Apple added to the top of the screen, and instead relied on static buttons on the keyboard for pre-defined options. It used different desktop metaphors....

    Xerox planted the seeds for the Desktop idea, but Apple and to an extent Microsoft, really fleshed out the idea and made it practical.

  • by weeb0 ( 741451 ) on Monday August 04, 2008 @12:54AM (#24462535)
    For the active directory, it's based on the nds tree of novel. Novel sent some of their engineer to help microsoft with their active directory ... Is it something that we can call innovative?
  • Re:Damn parasites (Score:5, Informative)

    by mixmatch ( 957776 ) on Monday August 04, 2008 @01:09AM (#24462619) Homepage

    Don't know about tabbed browsing, though it's plain for anyone to see that MS was late to that party, and brought with it a very clunky implementation.

    According to Wikipedia [wikipedia.org], It was the InternetWorks browser in 1994.

  • Re:News? (Score:3, Informative)

    by BlueCollarCamel ( 884092 ) on Monday August 04, 2008 @01:43AM (#24462803) Homepage

    If they're spending so much on R&D, where are the fucking results?

    Here: http://research.microsoft.com/research/projects/default.aspx [microsoft.com]

  • Slashdot at work... (Score:5, Informative)

    by Anonymous Coward on Monday August 04, 2008 @01:46AM (#24462817)

    I know it's somewhat taboo to RTFA around here, but I thought I'd compare with the summary anyway:

    Article, quoting MSFT:
    "Some of these firms may build upon Microsoft ideas that we provide to them free or at low royalties in connection with our interoperability initiatives."
    Implication: there exist some companies that reuse some of Microsoft's ideas, reducing their costs in the process (presumably at MSFT's expense)

    Slashdot summary:
    "Open source companies don't invest in research and development and instead largely free-ride on Microsoft's patents and copyrights"
    Implication: Microsoft claims most/all open source companies copy Microsoft's ideas and don't contribute anything

    Article,quoting MSFT:
    "Open source software vendors are devoting considerable efforts to developing software that mimics the features and functionality of our products, in some cases on the basis of technical specifications for Microsoft technologies that we make available."
    Implication: there are open source products that look and behave very similarly to some of Microsoft's products

    Slashdot summary:
    "Open source projects don't innovate and instead mimic Microsoft's products."
    Implication: Microsoft claims most/all open source products are copies of MSFT's products

    I understand that bashing MSFT is a popular passtime around here, but when the article summaries are completely misleading, that starts to get in the way of the trustworthiness Slashdot as a whole. If Slashdot hopes to remain relevant in the longterm, it needs to make at least some effort to accurately portray the stories. Otherwise, it will eventually become the internet equivalent of tabloids, worth only the entertainment value of reading the stories+comments, and completely untrustworthy for actual facts.

  • It does (Score:5, Informative)

    by melted ( 227442 ) on Monday August 04, 2008 @04:54AM (#24463721) Homepage

    Almost no one realizes that R&D has only a tiny sliver of R of it, and the rest of it is D. And by Development, they mean everything - developer/tester/program manager salaries, computers, costs of running the buildings and datacenters, IT, etc. So it's not like they spend $7B just on Microsoft Research. Last I heard, MSR costs something like $300M a year. And stuff from there does end up in products every now and then.

  • by init100 ( 915886 ) on Monday August 04, 2008 @06:21AM (#24464135)

    When you have a business that basically is 0% cost, and 100% profit (no, it doesn't cost even $1 to burn a CD).

    So in other words, all their products just materialize out of thin air? Or not. AFAIR, just Windows Vista sucked up more than nine billion dollars in development costs.

  • by unapersson ( 38207 ) on Monday August 04, 2008 @07:05AM (#24464317) Homepage

    SkipStone had tabs back in 2000, in version 0.6, and that was OSS. It was certainly much more tab-like than Opera's implementation back then, which was just a side effect of it being MDI.

  • Re:2 points? (Score:2, Informative)

    by maxume ( 22995 ) on Monday August 04, 2008 @07:16AM (#24464361)

    The annual report doesn't make any statement to the effect that "Open source projects don't innovate", it says:

    "A number of commercial firms compete with us using an open source business model by modifying and then distributing open source software to end users at nominal cost and earning revenue on complementary services and products. These firms do not bear the full costs of research and development for the software. Some of these firms may build upon Microsoft ideas that we provide to them free or at low royalties in connection with our interoperability initiatives. To the extent open source software gains increasing market acceptance, our sales, revenue and operating margins may decline."

  • Re:News? (Score:5, Informative)

    by jabuzz ( 182671 ) on Monday August 04, 2008 @07:40AM (#24464501) Homepage

    Add to that Visual Basic, Exchange, PowerPoint, and of course DOS itself. There are quite a few others. The idea that Microsoft does all it's own innovation is bunkum from the uninformed.

  • Re:News? (Score:3, Informative)

    by Knuckles ( 8964 ) <[knuckles] [at] [dantian.org]> on Monday August 04, 2008 @07:43AM (#24464519)

    Um, that's the list of research projects. The GP asked where the results are, in software that made it to market (I assume).

  • Re:Damn parasites (Score:5, Informative)

    by yelvington ( 8169 ) on Monday August 04, 2008 @08:35AM (#24464951) Homepage

    You missed a few steps. Mosaic wasn't the first, not by a long shot.

    Mosaic came along a couple of years after the first CERN Web browser and originally was for Unix systems. Mosaic was created at the University of Illinois with funding from Al Gore's legislation [wikipedia.org].

    By the time Mosaic became available for Windows, there were several alternatives on multiple operating systems, such as the original CERN browser, Lynx (text-mode from the University of Kansas), Cello (on Windows, from the Cornell Law School) and Viola (on Windows, from a UC-Berkeley student).

    All of these were developed in academic research settings, not by commercial enterprises. Sometimes the source code was distributed, sometimes it wasn't. Sometimes there were licenses permitting derivative works, sometimes there weren't.

    In early 1994 I contacted NCSA about licensing the Mosaic Windows source code for a newspaper online project I was working on. The price I was quoted was $50,000 for the source code and rights to create derivative works.

    NCSA transferred the Mosaic technology and rights to a local firm, Spyglass, which marketed "Spyglass Mosaic" with little success.

    Several years after the arrival of Mosaic (and Cello and Viola), Microsoft finally figured out that its proprietary Blackbird online technology wasn't going to survive the growth of the open Web. It then licensed Mosaic from Spyglass and used it as the basis for Internet Explorer.

  • Re:News? (Score:5, Informative)

    by gbjbaanb ( 229885 ) on Monday August 04, 2008 @08:48AM (#24465063)

    The idea that Microsoft does all it's own innovation is bunkum for the uninformed.

    You've got to understand who it is that keeps telling everyone how much innovation that they do - yup, Microsoft marketing itself. That way investors and PHBs look and think how great and forward-looking the company is, not realising that the only thing MS does towards innovation is buy innovative companies!

    Add to the list: Hotmail, Virtual PC/Server, Windows networking (BSD for TCPIP, IBM for lanman), Visual Sourcesafe, Foxpro, SQL Server (though, to be fair they did rewrite lots of it in later versions), Internet Explorer, Visio.. the list does go on and on.

    I'm not sure if Microsoft counts as innovation for NT itself, seeing as they 'bought' Cutler's team wholesale to reproduce VMS in a different package, and Heljberg who reproduced Java in a different package.

  • by toriver ( 11308 ) on Monday August 04, 2008 @04:30PM (#24472251)

    Want current? Submitting OOXML as a vendor-product-tied attempt at sidelining ODF, making a ton of Microsoft partners send form letters to national standard bodies to make ISO fast-track a document the size of the SQL standard.

    Oh, and then their implementation is not compatible with the standard to boot so that other implementors of the standard will be incompatible with MS Office 2007...

  • Re:Ad Hominem (Score:3, Informative)

    by tshak ( 173364 ) on Monday August 04, 2008 @04:54PM (#24472577) Homepage

    There is a free update for Office 2000 and Office 2003 that allows you to read Office 2007 formats: Microsoft Office Compatibility Pack [microsoft.com].

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