TV-PGNovember 7, 1999: Microsoft's taking a beating in court and on Wall Street; who taught these guys how to bribe, anyway? Meanwhile, Apple scores a big smack in the head for iMac cloners Future Power and Daewoo, and Motorola claims that Apple's G4 drought may soon come to a close...
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How To Grease Palms (11/7/99)
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By now, you've obviously heard about Judge Jackson's findings of fact. If you haven't, it's time to wake up and smell the ozone-- from the lawyers that Bill Gates had vaporized when the word came out Friday night. Yes, Microsoft has legally been found to be a monopoly, despite the company's constant claims to the contrary during the trial. And yes, the judge also determined that Microsoft has abused that monopoly power in order to stifle competition and harm consumers. While these are "just" the facts as Jackson sees them and not a final ruling, it's pretty obvious which way the wind is blowing. So the question that remains is this: other than trying to carve up the browser market with Netscape and then trying to kill the company later, plus trying to poison Java before it rendered Windows obsolete, plus threatening to eliminate Mac support for Office unless Apple ceased development of QuickTime, and then behaving like a pack of lobotomized weasels in court while all these details came out-- where did Microsoft go wrong?

The answer, friends, is simple-- they just didn't play the Washington Game very well. Bill Gates is the richest man on the planet; no matter how upstanding and ethical Judge Jackson may be, we bet if Bill's lackeys dumped a couple billion dollars on his lawn, his findings of fact would have turned out quite differently. Heck, at least maybe that stuff about Microsoft's arguments being "specious" might have been left out. But no; instead, according to a New York Times article, Microsoft decided to spread a paltry $470,000 when shopping for Republican politicians to lobby on its behalf in 1998. Granted, that's up from only $60,000 the year before, but we're talking about the Department of Justice, here. These are the big boys. And Microsoft's less-than-subtle lobbying effort to cut the DoJ's budget while the case was in progress? Well, all that did was make people laugh. As an unnamed DoJ official put it, "even the mob doesn't try to whack a prosecutor during a trial."

So Microsoft didn't spend nearly enough money, and it appears they didn't grease nearly enough people. Because of that oversight, Judge Jackson called them as he saw them, and the imminent end of "Redmond Justice" seems utterly predictable at this point. Meanwhile, we've just noticed that Apple's stock price has overtaken Microsoft's. Sure, that really doesn't mean a darn thing in financial terms (other than the fact that Microsoft is taking a Wall Street drubbing following Judge Jackson's legal smiting), but it's still kinda neat to see. Poor Microsoft; they spent half a million dollars in Washington and what did it get them? A big "M" for "monopoly" legally branded on their collective forehead, an imminent ruling against them likely to carry significant penalties, and a dwindling stock price as investors try to distance themselves from the falling Redmond Giant. Are they "beleaguered" yet?


 
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The Copycat Beatdown (11/7/99)
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And the courtroom gods continue to smile upon Apple. We don't know if all the planets were aligned or what, but Friday must have been Happy Legal Jig day in Cupertino. First of all, there's Judge Jackson's momentous antitrust smack-down of Microsoft, which is likely to make it just that much tougher for goons from Redmond to try to kill QuickTime by threatening to fit Mac Office with a custom pair of concrete shoes. But even more directly in Apple's favor was the news that a San Jose federal judge apparently plans to keep Future Power's ePower off the streets. (The ePower has already been removed from Future Power's web site.) A San Jose Mercury News article has more on the subject.

This is Apple's second courtroom victory against the daunting spectre of a market flooded with cheesy Wintel ripoffs of the iMac's distinctive design. It is, however, the first such taste of victory here in the U.S.A.; Apple's previous happy moment came when a Japanese court granted a preliminary injunction preventing Sotec from making, selling, or exporting its "e-one" computer until the case was over. Sotec has since "redesigned" the e-one to make it look less like the iMac's long-lost evil Wintel twin-- and when we say "redesigned," we actually mean "covered it with silver spray paint." Since then we've heard nothing about the case, and eMachines, who sells Sotec's clone here in the States, is apparently still hawking the blue and white monstrosities at Circuit City.

This latest ruling, though, is much more significant than just a simple preliminary injunction (though one is forthcoming). In this case, the judge actually ruled that "a computer's appearance is entitled to legal trade dress protections." Which means that Wintel cloners had better think twice before copying Apple's designs in hopes of stealing some of the iMac buying frenzy-- when Apple filed suit against the first cloners, that sent a message that companies who wanted to make iMac ripoffs should be prepared to go to court. Now that the judge has ruled in Apple's favor, the copycats should also be prepared to lose.


 
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The End Of The Drought (11/7/99)
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One of the few really dark stains on Apple's otherwise gleaming performance this year was the earnings warning lowering expectations of its fourth-quarter profits due to G4 availability problems-- remember the resulting stock dip? An even bigger stain was the time that Steve Jobs (or financial dude Fred Anderson, depending on which rumors you believe) lost his mind and downgraded the whole line of Power Mac G4s while keeping the prices the same. Worse yet was the PR bloodbath that ensued when Apple announced that all pre-orders for the original, faster G4 systems were being cancelled. It took a week of confusing policy revisions before almost all of the pre-orders were reinstated, and amazingly enough, not a single high-ranking Apple official was lynched in the meantime. (We hear that marketing guy Mitch Mandich had his car egged, but that may have just been a coincidence.)

Now look at those low points in Apple's otherwise stellar recent past. What do they all have in common? That's right-- the G4 chip. Or, more accurately, the lack of G4 chips. Apple's profits in Q4 were lower than originally expected because there weren't enough G4 processors to fulfill demand. Apple's decision to slow down the whole Power Mac line came because faster G4s just weren't available. And the cancellation of all pre-orders-- well, okay, that was just completely and utterly insane, but still, it would never have happened if the "speed dump" hadn't happened either. So what should any self-respecting Apple fan do when confronted with these nasties from Apple's timeline? Simple: Blame Motorola. Go ahead; Apple does.

Anyway, with a little luck, it appears that this particular supply problem may soon be behind us. According to a MacWEEK article, Motorola's director of communication and marketing states that his company is now "run-rated to meet Apple's demand in the fourth [calendar] quarter." Motorola plans to "focus on fulfilling demand" for the superchips, and soon, anyone who wants a Power Mac G4 will be able to buy one in a reasonable time frame. (We hope.) At which point, of course, Apple will have to find someone else to blame when things go terribly, terribly awry. We're betting on either IBM or the British royal family...


 
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