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Inside Windows

Microsoft presents its offer to reveal source code as a bold stroke to appease Europe. It may amount to far less.
Appeal In April
Microsoft's appeal of a 2004 EC antitrust decision that it abused its dominant market position will be heard in April. It's the next step in the company's long battle with the European authorities over allegations of unfair business practices, which led to, among other things, a record fine of $610 million. The EC last week said that it would review Microsoft's source-code offer.

All of which underscores that Microsoft is motivated mainly by regulatory appeasement, not altruism or capitalism, in making its source-code pitch. But the offer may not even serve its goal of getting the European regulators off its back, judging by the chilly initial response. "Normally speaking, the source code is not the ultimate documentation of anything, which is precisely the reason programmers are required to provide comprehensive documentation to go along with their source code," said Neelie Kroes, the European Union's competition commissioner, in an interview with Reuters.

Gates' company already is licensing protocol documentation under a 2002 U.S. antitrust settlement, but federal and state officials have repeatedly expressed dissatisfaction with Microsoft's compliance. The Justice Department last week blasted the company for its slow pace in providing documentation.

The source code it's offering will come from Windows Server 2003. (Separately, Microsoft last week said Windows Vista is on track for testing by businesses this quarter and general release in the fourth quarter. A Longhorn version of Windows server is due next year.)

Any Takers?
Competitors might not even want the deal. Microsoft's existing offer in Europe of reams of documentation and free tech support, but no source code, has been a dud: Not a single company has signed up. Microsoft has had more interest in the United States, where 26 companies are in its Communications Protocol Program. It has proposed extending the source-code offer to that program, too, and awaits U.S. regulators' approval. A few Microsoft partners have access to Windows code negotiated through custom arrangements.

Last week, however, it was hard to find potential takers. Novell is following developments "with interest," a spokesman said, but he declined to address the offer directly, citing Novell's settlement last year with Microsoft in the European antitrust case.

One unanswered question, is just how much of the Windows source code will be made available? Those details haven't been worked out, but Microsoft officials pledge to err on the side of providing more code than is needed to satisfy the EC mandate.

Even a fraction of the Windows source code would be a lot for most companies. By some estimates, Windows comprises 50 million lines of code.

Microsoft's stock market value last week was about $280 billion--$5,600 per line of Windows code. Given the stakes, Microsoft, its competitors, and regulators will be haggling over that precious programming output for a long time to come.

-- With Gregg Keizer