The FTC Needs to Investigate Microsoft!

April 13th, 2009

I’ve been extremely hard on Microsoft in recent years. First, I’ve criticized them for their bait and switch and other shady marketing schemes, and then I’ve even gone so far as to suggest they are doomed to fail big time in a few years.

I don’t think many of you agree with me about Microsoft’s potential for future irrelevance. After all they still have billions in the bank, and they make huge profits on their software. All right, they are laying off 5,000 people, but maybe they were simply overstaffed and used the state of the economy as an excuse to dump unproductive workers.

But I’m quite serious about what I say, and I think Microsoft’s sordid history is sufficient to warrant some close scrutiny by the authorities. We in the states shouldn’t depend on the European Union to do the heavy lifting when it comes to fining Microsoft for various and sundry offenses.

Sure, the Department of Justice also clamped down on the company more or less, but the regulation-free environment of the Bush administration probably lessened the penalties. For example, efforts to break up the company were quickly abandoned.

Now in recent issues of our weekly newsletter, I have reminded you of some of the questionable tactics Microsoft has employed over the years. They promised technologies that were either never delivered or released in crippled form in order to ward off competitors. That the media continued to believe them through the years without bothering to follow up on past misrepresentations is highly unfortunate. It almost seems as if too many so-called reporters are afraid to ask Microsoft the hard questions about their shady behavior.

But let me put my cards on the table. You see, there’s nothing wrong with being a fierce competitor. It’s a jungle out there, and may the best company win. All too often, however, Microsoft has succeeded not because they built the best product, but because they were able to stomp down other companies in a dishonest fashion to gain ascendancy.

However, their worse offense was the early programming decisions that failed to anticipate the rise of Internet malware, and thus left Windows users supremely vulnerable. Some years ago, Consumer Reports published an article stating that some nine billion dollars had been lost by businesses as a result of PC-based computer viruses in the previous two years. What wasn’t mentioned is that every single penny was due to a Windows malware infection of one sort or another.

I suppose Microsoft could defend themselves by claiming that no computing platform is immune to malware. That is true. They could also state that they are targeted more often because they occupy the number one position in the operating system market. Further, that it’s largely the fault of their customers that their systems are not properly protected. Microsoft claims to release security patches in a timely fashion, and security software companies will also update malware definition files as soon as new infections are discovered.

This combination, they would probably assert, ought to keep most PC users fully protected. Yet, as many of you know, millions of PCs were invaded by the Conficker worm, and its full impact is not yet certain. All right, Microsoft will also claim that those who suffered from those infections failed to take proper security precautions. It is, therefore, their fault.

Unfortunately, a defense of that sort is based on the assumption that all malware can be controlled with Windows patches and security updates. The problem is that many PC viruses infect a large number of computers before patches are developed and virus definitions updated. That is, of course, the shortcoming of these techniques, since Microsoft and the other companies are always playing a game of catchup.

So how does the FTC get involved? Well, first, an action on their part could be based on misleading advertising. An example would be that fake survey Microsoft commissioned from industry analyst Roger Kay to prove PCs cost thousands less than Macs to buy and operate over a period of five years. The flaws are so blatant that I wonder how the guilty parties believed they could get away with it, and not suffer from careful scrutiny — and not just from loyal Mac users.

Other deceptive tactics would be more difficult to prove, but maybe worth the effort nonetheless. It would involve demonstrating that the flawed development process of Windows made it more susceptible to malware than it would have otherwise been. The examples of Unix, for example, would show that it’s possible to build a PC operating system that makes it more difficult for malware to spread, thus perhaps saving customers billions of dollars in lost productivity and revenue.

Indeed, I wonder why customers aren’t filing class action lawsuits right and left against Microsoft for its various and sundry offenses. Sure, no doubt there are such actions here and there, but none come to mind of a significant nature that are apt to gain sufficient credibility to yield positive results.

I realize that my request is difficult, and the FTC no doubt feels it has more important things to do. Then again, don’t they use Windows PCs too in large part? Surely they know what’s wrong with Microsoft without people like me having to tell them.

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12 Responses to “The FTC Needs to Investigate Microsoft!”

  1. Blad_Rnr says:

    It is incredible how Microsoft can get away with selling an OS that is neither secure nor impervious to spyware, malware or viruses right out of the box, year after year. Windows is a scam! Look at the companies that are in business because Microsoft can’t properly defend its OS from attacks (Symantec, McAfee, Kaspersky, to name a few). And people just believe that’s the way it is. It’s like a car company who manufactures a car where the tires are bald, the steering works some of the time and the alignment is always out, and the owner has to take it to a mechanic every day to have these issues fixed to operate for another day. And when the driver gets in an accident the manufacturer says the driver is always at fault. Seriously. Time for a recall on Windows.

    This isn’t the 1890s. Car manufacturing is an efficient, technically systematic process where failures are not rewarded over time (AMC, Edsel, Eagle, etc). How is Microsoft any different? Companies need to wake up and ditch Windows or take their PCs off the ‘Net. In fact, I would claim Windows PCs on the ‘Net are making it a liability. They allow all sorts of crime to take place, i.e. banks to be infiltrated and government offices to be spied-on. And where do people think spam comes from these days? It comes from their own PCs acting as a bot on the spam botnet, and they don’t even know it! They don’t even know it.

    If using a Mac or other UNIX/Linux computer is regarded as being safe only because there are so few of them, then why do they continue to use a Windows PC? If it’s safer, more secure and does not attract malware, spyware and allow itself to become part of the spam botnet, then why don’t they switch at least in the short term? Because they don’t believe it. They use the *security through obscurity* myth to fend off the truth. It’s that simple.

    UNIX is the answer, in whatever flavor you want. The Internet (DARPA) was developed on UNIX computers and therefore it is the only OS properly made to run on the Internet. When will CIOs figure that out?

  2. Ed says:

    Excellent article. We should never forget the crimes MS committed in the 1990s (the antitrust trial has plenty of evidence). MS continues to be a monopoly, and continues to use their monopoly power and influence to further their monopoly.

    What I fear is a level of complacency toward PCs and MS in general. That people go on using their Windows PCs thinking that malware and viruses are a fact of life. Like death and taxes.

    What has always angered me the most is that MS is the largest software company in the world, yet their software is not much more than mediocre. Personal Computers have the power to be so-much-more than what they are today. The problem appears to be that MS is motivated by profits, not advancement of technology. Throughout MS’ history, their so-called advancements were motivated by potential loss of market share. Windows itself was in response to Apple’s GUI. Illegally bundling/integrating Internet Explorer into Windows and giving it away for free was in response to Netscape. If MS was such a great company, it would have researched and produced these technologies first.

    But, as I’m sure we’ve all heard, there are stories about engineers at MS who had great ideas, only to be told “Yes, but how will that sell more copies of Windows?”

    If MS is the greatest software company in the world, as they would have us believe, then why is their software still vulnerable to viruses and malware?

  3. Rick says:

    For those too young or suffering from short-term memory loss, I would suggest reviewing MS Litigation on to gain an awareness of the history and scope of Microsoft infractions. No amount of Gates Foundation philanthropy could make up for the loss.

  4. Mike says:

    However, their worse offense was the early programming decisions that failed to anticipate the rise of Internet malware, and thus left Windows users supremely vulnerable.

    Some might say that’s too kind of you. There’s a famous quote from Bill Joy:

    I find Windows of absolutely no technical interest. They took systems designed for isolated desktop systems and put them on the Net without thinking about evildoers, as our president would say.

    One’s inclined to think that Microsoft cannot have not known that other systems had been designed with the dangers of online use in mind, but that they simply went ahead with what they had anyway, knowing it was their users who would suffer.

    They [Microsoft] could also state that they are targeted more often because they occupy the number one position in the operating system market.

    That they’re a large target is undoubtedly true – “true but not exhaustive”. The iloveyou worm didn’t spread merely because Microsoft software was ubiquitous, but because Microsoft’s email clients ran scripts.

    XP actually had a firewall, but, until Service Pack 2, it was not turned on by default. That allowed some pretty spectacular outbreaks (e.g. zotob, which took down CNN) that wouldn’t otherwise have worked.

    Windows didn’t get anything like the Unix elevation of privilege model until Vista’s “user account control”.

    It’s good that Microsoft do seem finally to be putting a lot of resources into security. But they only began to do so when it became clear that their reputation in that area was hurting sales and causing people to search out alternatives. Furthermore, anyone who claims that their previous problems have been just down to market-share is trying to re-write history.

  5. Ed says:

    Mike wrote:

    It’s good that Microsoft do seem finally to be putting a lot of resources into security. But they only began to do so when it became clear that their reputation in that area was hurting sales and causing people to search out alternatives.

    Exactly. Every move that MS has made has been to secure more market share, or (in this case) prevent any loss in market share, in a market where they are already the monopoly. MS is not motivated by advancing software/OS technology. They are motivated by market share alone. In the end, this is a disservice to their customers and, eventually, their stock holders.

    Consumers need to open their eyes and see this fact: MS is not the “savior” of the desktop that they portray themselves to be.

  6. @ Ed: Let there be no illusions: Apple is a profit making corporation too. But there is nothing to prevent a company from making money and build good products too.


  7. Ed says:

    Gene Steinberg wrote:

    @ Ed: Let there be no illusions: Apple is a profit making corporation too. But there is nothing to prevent a company from making money and build good products too.

    I agree, totally. And if you got me started I could give you a laundry list of ways Apple has crossed ethical borders in order to sell its users new hardware.

    But my point is: MS doesn’t innovate. It protects its market share. MS is not in the business of advancing computing applications. It is not in the business of creating the operating system to which all other OSes are compared to. MS is in the business to sell Windows and Office to as many people as possible. MS doesn’t care if it has the best OS around; all it cares is that it owns 95% of the desktop market. This is why monopolies are bad, be it in software, oil, cable companies, or soup. There is no reason to innovate when you own your market.

    To bring it back to your article, there is no money to be made from making a more secure operating system until there is money to be lost by not having one.

    There is no money to be made for making a better operating system until consumers see the advantage of having a better operating system. And, to Apple’s credit, that’s exactly what they’ve done. Through perseverance, Apple has shown users what “It just works” really means.

    I dread the day that Apple becomes the monopoly and MS (or some guy working in his garage) is the innovator.

  8. ibleed6colors says:

    Oh Ed, give the “Microsoft doesn’t innovate” rhetoric a rest. Of course they innovate and develop new products from that innovation. You may not like all that they do, but take a look at what they’ve done in the corporate backend world, and compare it to the world of Novell Netware circa 1993, or that crap IBM pumps out called Lotus Notes, and then get back to me about ‘no innovation’.

    And yes, I am aware of how much flowed from acquisitions.

    Large corporations regularly innovate though acquisition. You may think that Microsoft is evil because it acquires small companies ($$$) and rolls the technology into other products. But the reality is small companies are able to take risks that large companies can’t. And Apple is no different – in fact our iPods might be the best example of that. the iPod is actually a creation of acquisition – Hardware IP from a guy named Tony Fadel (he went internal to Apple), software from Casady & Green (SoundJam MP) and a TON of innovation to integrate it all together. I LOVE the fact that small companies have a chance to get paid for their hard work, rather than be forced to give it away for free.

    Beyond the innovation question, we’ve seen time and again that Microsoft is not capable of any kind of master planning, and instead is trapped by huge seat license customers requiring software that works in the corporate environment.

    The interests of home end users is just not all that significant when compared to a request from a company that might have 60,000 copies installed, and needs “just one tiny hole so that a legacy app can work”.

    I’m bored by Microsoft bashing. The biggest threats to Apple won’t come from MS, they will come from companies like Google that will teach people things have value can be had for nothing more than your willingness to look at an ad.

  9. tom b says:

    MSFT is no longer in a good “ecological niche”. MSFT has been the darling of pasty, french-fry stuffing MCSE’s because you can still run any dreadful accounting package or VB script dating back to the DOS years. BACKWARDS COMPATIBILITY is the God of their world.

    If MSFT had been interested in doing the “right thing”, instead of spending 5 years on Vista’ eye-candy, they’d have gone UNIX. Apple did that, and eventually killed off the “Classic environment”. Had MSFT done the same, the result would have been very different. Everybody would have jumped ship for cheap/secure (LINUX), or full-featured/ultra-dependable (OS X), because, in upgrading to UNIX, WIndows would have lost a significant fraction of their backward compatibility. Thus; the arguement for Enterprise’s cultish attachment to Windows would disappear.

  10. Ed says:

    @ ibleed6colors:

    Smile. Thanks for contributing. I was wondering how long it would take for someone to come to MS’ defense. And FWIW, Apple “innovated” iTunes through an acquisition. That’s not my point.

    My point is that MS’ motivations are purely to maintain market share, not to advance software for the sake of advancing software. Okay, so maybe I’m an idealist, but shouldn’t the biggest software company in the world also be the best? In regards to this article, there’s no money to be made for plugging holes in the operating system. But in MS’ case, there’s money to be lost if they don’t.

    Oh, and if you want to look at ads, I think that’s great. Advertisers love people like you. Personally, I’m mad-as-hell that I pay Comcast $60 a month so I can watch commercials. I’d happily pay $2 to download an episode of BSG without commercials than watch it with ads on Hulu. But hey, that’s just me. And a few thousands other viewers, it seems.

    And sorry to hear you’re bored with MS bashing. I’m sure if there were enough folks in the Clinton administration that were bored with it we may have never had the anti-trust trial in the first place.

    Never resting….

  11. iBleed6Colors says:


    Wow, Clinton administration comments? You do realize that people born during Clinton are now nearly old enough to vote? Ed, 1998 called and they want their rhetoric back!

    I’m bored because Microsoft is a “belled cat” at this point. You know what they are doing because you can hear the coming. They innovate where it will make them money, don’t where it won’t, and are over-scrutinized by a European Commission that seems more focused on ‘punishing Americans’.

    With regards to “Advancing software”: Advancing software for the sake of advancing software isn’t what any company does; and it’s not even what the OSS world does either. Companies like Apple and Microsoft try to sell software that solves problems for users, the true OSS community (as opposed to IBM-style corporate work) writes software to solve specific problems as seen by those who work on the project.

    No one writes software for the sake of software – because computers are tools, not art installations.

    Oddly, I think you misinterpreted what I said about ads, I think you and I agree. I dislike the new direction that says ads are the ONLY way to get paid. I think it devalues the efforts of innovative programmers, especially folks in the Mac shareware community.

  12. Ed says:

    iBleed6Colors wrote:

    Ed, 1998 called and they want their rhetoric back!


    (and still laughing at “belled cat” — never heard that one before but it fits)

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