December 1, 1999

Hold On To Your Wallets: Here Come The Lawyers

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California lawyers have filed a class-action lawsuit against Microsoft on behalf of consumers. Do you think you or your company will benefit from any class-action suits? Do you think that, on balance, Microsoft's actions actually and directly harmed you or your company? Does having more lawyers involved increase or decrease the chances that all this will be settled in a just--and not merely legal--way? Join in the discussion.

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Fred Langa is a senior consulting editor and columnist for Windows Magazine. Fred's free weekly newsletter is available via subscribe@langa.com. You can contact him at fred@langa.com or via his website at http://www.langa.com.

By Fred Langa

It was inevitable, I suppose. Within days of Judge Thomas Penfield Jackson's findings of fact that pilloried Microsoft for anti-competitive behavior, a group of antitrust lawyers in California filed suit "on behalf of consumers" to recover unspecified damages and remedy the harm that Microsoft supposedly had inflicted on these hapless users.

What a crock.

The findings of fact specify amazingly few concrete examples of actual harm to consumers. Here are three key ones that were specified: Some users might not want a free browser(!); Microsoft probably could have charged less for upgrades; and if Microsoft hadn't been so aggressive, there might be wondrous other products available now from other companies.

There are obvious problems with all of these points. For example, Microsoft took a product--a browser--with a nominal value of $50 and reduced the price to $0. This was very bad for Netscape, but how on earth can anyone argue that that was bad for consumers? Gosh, those evil Redmondians, saving us $50 per seat! They must be punished!

Upgrade prices? Judge Jackson--no techie he--seems to believe prices for Windows should have fallen over the years. But consider this: I went rummaging in my closet and dug out the actual original equipment manufacturer install disks for the pre-monopoly Windows 3.0 (circa 1990) that came with a PC I once had. There are five 1.2-Mbyte floppies, or 6 Mbytes total code. My copy of Win98SE, not including the samples and demos that ship on the CD, comprises 339 Mbytes. In other words, today's Windows ships with 57 times more software than in 1990, yet the software costs more or less the same now as it did then. Yes, there's an easy joke about "code bloat" in there, but any rational observer will admit that a lot of that extra code represents extra functionality. Gosh, those evil Redmondians, giving me 57 times the software for roughly the same price! They must be punished!

And those wondrous other products that might have come out? Well, heck, without the stranglehold of the evil Redmondians, we'd have multiple other operating systems to choose from. Oops, wait a minute: We have about four dozen Linux variants, plus BeOS, FreeBSD, Solaris, OS/2, MacOS, PalmOS, Apache.... Er, well, no matter. Microsoft must be punished anyway!

As I've mentioned in previous columns, there are indeed some behaviors where Microsoft clearly did step over the line and for which it clearly should be punished. But I believe it's next to impossible to make a complete, balanced case that demonstrates real harm to consumers.

And yet the Department of Justice, the state attorneys general, and now class-action lawyers are all wrapping themselves in the flag of consumerism.

If you took away the headlines and the political benefits for the first two groups and took away the chance of pocketing millions of dollars from the latter group, I wonder how much of this would have ever happened.

But to bring this column full circle, I will bet you right now that if the class-action suit progresses, the only real beneficiaries will be the lawyers themselves. That's ironic: The lawyers will use a largely imaginary harm to consumers to justify a huge and very real monetary benefit to themselves.

But what's your take? Do you think you or your company will actually benefit from any class-action suits? Do you think that, on balance, Microsoft's actions actually and directly harmed you or your company? Does having more lawyers involved increase or decrease the chances that all this will be settled in a just--and not merely legal--way? Join in the discussion!

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