Analysts: Microsoft ruling clears way for enterprise software push

Feature

Analysts: Microsoft ruling clears way for enterprise software push

Microsoft will be able to pursue its current business strategy unhindered by the latest ruling in its long-running antitrust battle, according to analysts.

The company has already made many changes required as part of last year's settlement with the Department of Justice. Last week's ruling by Judge Kollar-Kotelly rejected most of the demands of the nine US states that were demanding harsher penalties.

Little has changed
Gartner analysts Thomas Bittman and Michael Silver said the latest decision represented a "big win" for the software company. "Microsoft has already made most of the required behavioural alterations, so enterprises should not see any changes," they said.

Microsoft is still facing legal action, particularly in Europe, but the ruling could pave the way for the company to make new acquisitions.

Microsoft's next move
Acquisition has always been central to Microsoft's growth, according to Philip Carnelley, research director at Ovum, who said the ruling would allow Microsoft to push further into the enterprise application software market.

The company was seeking to use its acquisitions of Navision and Great Plains, to turn a $500m (£322m) enterprise application software business into a $10bn (£6.4bn) business, said Carnelley.

"The IT market is unlikely to grow. The only way for Microsoft to create a $10bn enterprise application software business is by capturing market share," he said.

Carnelley was concerned that last week's ruling offered little protection for companies operating in this area of the software business. He predicted that companies specialising in small and medium-sized business applications, such as Sage and Systems Union, would face strong competition from Microsoft.

Software compatibility
Microsoft's ability to move into new markets does not appear to have been affected by the ruling, but the remedies agreed with the Department of Justice do simplify integration between Microsoft and non-Microsoft technologies.

Carnelley said the ruling forbids Microsoft from using hidden program interfaces within Windows to optimise its own application products. "This will help Linux, particularly on the server side," he added.

The settlement prohibits Microsoft from imposing unreasonable or discriminatory licence terms for access to programming interfaces within Windows. It does, however, permit Microsoft to require a reasonable royalty for the use of its technology.

Meta vice-president Ashem Pal said the settlement has not defined the level of access to the Windows interface technology that a rival should receive.

"Seeing the source code to Windows won't help without documentation," he said. "I am highly sceptical whether the Court ruling will have any impact on the openness of Windows."

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This was first published in November 2002

 

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