Contractual Goofiness (4/10/02)

There's been a certain amount of hand-wringing recently about what might happen once that landmark "technology agreement" between Apple and Microsoft expires this August. You know the one; it guaranteed that Bill and crew would continue to develop and sell Mac versions of Microsoft Office for five years, in exchange for which Apple would make Internet Explorer the default web browser on all Macs. There was a little more to the whole deal than that, like Microsoft's purchase of $150 million of nonvoting Apple stock, a Patent Cross License Agreement, yadda yadda yadda, but it's the notion that Office might suddenly evaporate this summer that has some Mac users a tad nervous.

Well, it's not like we ever seriously thought that Microsoft would toss away a perfectly good revenue stream and invite further antitrust difficulties by pulling the plug come August, but if you were even a teensy bit worried about that possibility, you can exhale now; according to an article at CNET, Microsoft today announced that it plans to support the Mac platform indefinitely. "The agreement has ended [uh, shouldn't that be "will end soon"?], but our business is absolutely continuing"-- so sayeth Kevin Browne of Microsoft's Mac Business Unit. He pledged Microsoft's intent to continue developing Mac versions of Office and IE, plus maybe some other titles "if it does not take up too much of the software maker's resources and if the company can get a decent return for the efforts." (In other words, don't hold your breath for Access, folks.)

So, do you feel better now? No? What's wrong? Oh, you noticed that Microsoft hasn't historically been the most trustworthy of business partners and that the company is apparently refusing to re-commit to the Mac platform on paper. You feel that Kev's statement that Microsoft will "continue this business as long as the business case makes sense" sounds a shade ominous, and a little too much like an escape hatch being readied. Hmmm. Well, yeah, those are some valid concerns, but to set your minds at ease, would it make you feel any better if we told you that Microsoft's obligation to sell Office for the Mac actually expired about eight months ago?

No fooling! Eagle-eyed faithful viewer Erick Wong noticed that a scan of the original 1997 technology agreement is actually downloadable in PDF format from the Justice Department's web site, because it was used as evidence in the "Redmond Justice" trial. (Don't ask us how we missed that.) It's all in legalese, of course, which would normally send us into a coma, but Erick points out an interesting clause on page four which appears to give Microsoft the option to stop making and selling Mac Office if Apple hadn't sold at least three and a half million Macs in the four full quarters preceding August of last year. We did a little digging through Apple's press release library and totaled up the number of Macs it reported as sold in each of the previous four quarterly earnings reports. Guess what? We show 3,359,000 units sold.

Which means, of course, that if we're right, Microsoft could have pulled out of the deal last August-- but didn't. And as Erick shrewdly points out, that bodes sorta well for the continuation of Mac Office even once the technology agreement naturally lapses in four months' time. Now do you feel better? Good. Now please excuse us; since we just gave you a reason to believe what Microsoft said, we have to go shower for about four hours until the shame washes away.

SceneLink (3682)
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The above scene was taken from the 4/10/02 episode:

April 10, 2002: Turns out that Mac OS X is so cool, even the guy who invented Java is using it. Meanwhile, Apple posts some Mac Genius job openings that reveal a handful of new stores coming soon, and Microsoft (sort of) pledges to continue developing software for the Mac-- and we even have a reason why you might want to believe that...

Other scenes from that episode:

  • 3680: Welcome All Java Geeks (4/10/02)   Even more so than "People Buy Shiny Things," Apple's primary credo in the Second Jobs Dynasty appears to be "If You Build It, Geeks Will Come"-- "it," in this context, being Mac OS X, and a "geek" being anyone of a technological bent who previously would no sooner have chosen a Mac than he or she would have swallowed live flaming bees in a quest for spiritual enlightenment...

  • 3681: 4 New Stores, 3 New States (4/10/02)   Wake the kids and phone the neighbors, retail fans, because the latest batch of unannounced Apple stores is hot off the griddle and ready to elicit what we're sure will be the awed "ooohs" and "aaahs" they so richly deserve...

Or view the entire episode as originally broadcast...

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