The rules have changed
(IDG) -- Four years ago, Network World published a series of three articles suggesting Microsoft was gaining control of the network through its ability to set de facto standards. The series made the case that Microsoft had "sprinted ahead of plodding standards groups" and "used its market share to push its specifications so far into the market that even its biggest rivals have to play along."
Since then, Microsoft has been forced to fight a horde of legal actions intended to prevent it from leveraging what some see as a monopoly on the desktop. At the same time, the explosive growth of the Internet has utterly transformed the network landscape - a development few foresaw in 1994.
Amidst the swirl of legal wrangling and rapid market transition, Network World set out to discover just how much power Microsoft wields in the standards-setting process. We surveyed 200 readers for their opinions on the matter and interviewed dozens of interested parties, including users, officials with standards bodies and interest groups, competitors and consultants.
The rules have changed
The software giant still has standards clout, but in a world gone Internet-mad, it can no longer dictate the agenda.
While it's clear Microsoft is intimately involved in the standards process, there is no conclusive evidence that the company has successfully manipulated the process to give itself a competitive advantage. Rather, the evidence shows that the onset of Internet technologies has put a premium on standards and interoperability, leaving Microsoft with far less ability to influence network standards than its detractors claim.
The case against Microsoft
One of the harshest critics of Microsoft's behavior in the network arena is the Software Publisher's Association (SPA), the principal trade association of the software industry, representing 1,200 member companies accounting for 85% of U.S. revenue for packaged and online software. Despite the fact that Microsoft is a member, the SPA recently published a scathing report, "Competition in the Network Market: The Microsoft Challenge," that accuses Microsoft of setting de facto standards that favor the company's products.
According to Lauren Hall, the SPA's chief technologist and author of the report, "Microsoft has an incredible potential for locking the network market up because if you control the protocols that the desktop can understand, you can control the protocols that are supported on the network."
The SPA is especially concerned that Windows NT will dominate the market, giving Microsoft too much leverage with respect to standards and other issues. The group has even asked the Department of Justice to look into Microsoft's behavior in the network market. The government appears to be listening because the Justice Department is indeed investigating the role and status of Windows NT, according to Justice Department spokeswoman Gina Talamona. While Talamona would not reveal the status of those investigations, she says they are continuing.
The SPA report echoes the concerns voiced in the original Network World articles, which described the potential industry impact of Microsoft standards such as the Open Database Connectivity (ODBC) protocol for heterogeneous database access, the Messaging API (MAPI) and Object Linking and Embedding (OLE), a mechanism for linking applications.
Since the publication of those articles, ODBC has had a "huge impact," according to Todd Chipman, a senior analyst at the Giga Information Group in Santa Clara, Calif. "It allows Microsoft to set database standards, thereby making it easier to displace Oracle with Microsoft's Access database product."
MAPI's impact has been more muted because of the advent of the Internet. "A lot of vendors are just using the Internet standard SMTP as opposed to MAPI," explains Tom Austin, vice president and research fellow at Gartner Group. MAPI remains a proprietary Microsoft specification, used in products such as Outlook.
As for OLE, it has been subsumed into Microsoft's Component Object Model (COM) standard, which functions as a common language that enables various software elements to communicate with one another. It's the COM standard with which the SPA has a particular beef. Microsoft developed COM in competition with the evolving industry standard Common Object Request Broker Architecture (CORBA), which was promoted by the Object Management Group. According to the SPA, the CORBA standard would have had "widespread benefit for interoperability between vendors across the computer industry." Microsoft's adherence to COM, on the other hand, "allows Microsoft to maintain a proprietary advantage."
At first glance, this argument seems shaky because CORBA has been widely accepted. "CORBA has been successful," Hall admits. "But the thing that concerns us is that the increasing installed base of NT licenses gives Microsoft a dominant market position."
Corporate IT managers might balk at buying products that are tightly integrated with standards that Microsoft might not support in the future, she says. In other words, even when Microsoft supports standards other than its own, the company has the power to selectively withdraw that support or at least threaten to - actions that could fatally cripple a competitor.
It's not just the SPA that's worried about Microsoft's influence. Network World subscribers agreed by a more than 2-to-1 margin - 55% to 25% - that Microsoft uses its power to establish standards to gain an unfair advantage over the competition.
Microsoft denies it has any intention to use network standards in that fashion and questions whether it's even appropriate for a trade association to get involved in matters of litigation between its members and the government. "It's unfortunate that a small handful of competitors are using the SPA to wage an anti-Microsoft campaign rather than work on common industry challenges," says Brad Chase, Microsoft's vice president of Windows marketing and developer relations.
"The key standards such as HTML have been developed by the industry working together," Chase says. "We support industry standards wherever possible."
Chase points out that Microsoft has adopted TCP/IP, HTTP, base HTML, Secure Sockets Layer, Kerberos and many other standards in the Internet and network area. And even in cases where Microsoft advocates technology outside of the formal standards process, the company tries to develop them in "an open and collaborative fashion with our partners," according to Chase.
A case in point is the Transaction Internet Protocol (TIP). Microsoft worked with Tandem to define a protocol that would ensure multivendor transaction monitors would work with one another to complete transactions over the Internet. They submitted their idea to the Internet Engineering Task Force (IETF), and the result is RFC 2371, issued in July. James Utzschneider, director of the line of business evangelism at Microsoft, says TIP now has widespread vendor backing. "It will become a standard," he says.
Utzschneider bridles at the suggestion that Microsoft is less than cooperative with standards bodies. "We're doing all we can," he says.
Chase points out that Microsoft is "very involved" with many standards bodies, such as the World Wide Web Consortium (W3C) and the IETF. "We have over 100 people working full-time on standardization and product development in these areas, and we have three full-time people just doing coordination of all of the standards work going on around the company."
The company's investment in standards is thus comparable to its investment in public relations, which is formidable by anyone's standards. Mich Mathews, the head of Microsoft's public relations department, says the company has 150 full-time public relations professionals working for it.
Kevin Kean, group product manager for the NT Group's Communi-cations Products at Microsoft's Redmond, Wash., campus, says the company's technical community is extremely active in the standards process. "Our development and program managers participate in any number of standards bodies, from low-level network stuff to high-level APIs," he says. "Our activities range from simple participation to actively influencing the development of new standards."
The motive question
Giga Information Group's Chipman, however, is cynical about Microsoft's standards activity. He says Microsoft is "trying to propagate its own proprietary technology and achieve a dominance by locking customers into a Microsoft-centric solution." He believes Microsoft participates in standards processes mostly for show. "Participation makes Microsoft look like they're trying to work with the rest of the industry rather than just trying to dominate it," he says. "Perception is everything in this business."
Keith Brannon, chief technical programming officer at the International Standards Organization (ISO), seems to share some of Chipman's suspicions regarding Microsoft's motives. "To my knowledge, Microsoft has never submitted a standard to ISO," he says. "There have been efforts made to involve Microsoft in the process with various specifications, but Microsoft has been reluctant to play along."
Microsoft denies it's ignoring the ISO. Chase says the company is increasingly active in the Joint Technical Committee 1, which coordinates activities between the ISO and the International Electrotechnical Commission. Microsoft is also "very active" in several ISO subcommittees, Chase says, such as SC 29, which is working on MPEG specifications for digital audio/video encoding.
Nonetheless, the perception lingers that when Microsoft participates in the standards process, it is to steer the outcome to meet its own ends, even at the expense of the greater good.
A full 40% of respondents to the Network World survey expressed concern over the level of control Microsoft has in the standards process. The concern was even greater - at 47% - among respondents from large organizations.
Perhaps that perception stems from standards battles of the past, such as that over the Desktop Management Interface (DMI), a specification drawn up by the Desktop Management Task Force (DMTF). The DMTF was founded in 1992 by a group of leading vendors, including Microsoft, to define a bidirectional path that would enable a central management station to interrogate all the hardware and software components within a PC.
The resulting DMI, released in 1994, consists of four parts, only two of which Microsoft decided to support. The company said its Plug and Play technology addressed the other two components, which collect and store device information. Microsoft argued it could use Plug and Play, which was already in Windows 95 and was adopted by third parties, to collect management data. The company did pledge to use the remaining DMI components to ship management data to a central console.
The decision didn't sit well with many other vendors, which perceived Microsoft was twisting the standard to give itself a proprietary advantage. Ultimately, most vendors implemented the DMI to some extent, but the standard fell far short of providing its intended benefit.
Fast forward to this year and contrast DMI with the Common Information Model (CIM), another DMTF standard that grew, in part, out of the Web-based Enterprise Management (WBEM) initiative spearheaded by Microsoft and Cisco. Microsoft's strong backing of CIM has a bevy of vendors eager to support the specification, which enables management programs to exchange information.
Ajay Singh, president and CEO of Proactive Networks, a Santa Clara, Calif. start-up, says Microsoft's backing of CIM is "absolutely" a big plus for his company. Proactive Networks focuses on analyzing data culled from various network components to identify key trends. SNMP makes it relatively easy to get all the network data required, but extracting performance data from servers and applications is a tougher nut to crack. "If Microsoft says CIM is the way to go as a standard way to get information on servers, that makes it suddenly easier to get that information," Singh says.
Sally Khudari, who until last month was head of communications at the W3C, is generally supportive of Microsoft's standards efforts, but she acknowledges Microsoft can threaten a standard by refusing to cooperate. "That causes confusion and may or may not cause the adoption of the standards to be completely shaken."
For example, the W3C invited Microsoft to participate in development of the Synchronized Multimedia Integrated Language (SMIL) standard, but the company elected not to participate. Ian Jacobs, a technical editor in the W3C's communications group, says the decision "shook the working group, but enough people think it's a valid specification so that the consortium continues to support it, even without Microsoft's blessing."
Microsoft spokesman Adam Sohn says there's a good reason behind the company's SMIL 1.0 decision. "We simply thought that the technology was not ready and was in need of additional work toward better and more complete integration with the document object model and with HTML," Sohn says. It was a customer satisfaction issue, he says, not some nefarious attempt to scuttle a competing standard. Microsoft is working with the W3C on future versions of SMIL, Sohn notes.
Praise from standards-setters
There's little question that a yea or nay from Microsoft can seal the fate of certain standards. But the notion that Microsoft bullies network standards organizations is much harder to prove and certainly is not shared inside most standards bodies.
Khudari praises Microsoft for its involvement and contributions to the W3C. She also vehemently denies that Microsoft has had an undue influence on the development of the organization's standards, which includes Extensible Markup Language (XML) - a subset of the Standard Generalized Markup Language, a document language designed for use on the Web and sanctioned by the W3C.
While Khudari concedes Microsoft was on the XML working group before its major competitors, she "challenges anyone to tell us that we veer toward any individual vendor. We're vendor-neutral, and we mean it." The group is also open to all types of organizations, including commercial, educational and governmental entities, whether for-profit or not-for-profit. It now has over 250 industrial members, and therefore, is a large enough group that no one organization can dominate.
Jim Carlo, chairman of the umbrella subcommittee for LAN standards at the IEEE, likewise questions whether any company - Microsoft included - can manipulate the standards process to its own advantage. "It's not a question of my company's position is such and so.' Standards are set by individuals, not the companies that sponsor them," Carlo says.
Steve Coya, executive director of the IETF - a mostly volunteer organization of working groups dedicated to identifying problems and proposing technical solutions for the Internet - similarly doubts whether any vendor, even Microsoft, has the power to dictate network standards. "There are times that Microsoft attempts to set their own proprietary standards, and there are times that they participate with the IETF on international standards," he says. Most of Microsoft's proprietary standards tend to be built only into Microsoft products and thus have a limited impact on the industry as a whole, he notes.
While standards organizations, with the possible exception of the ISO, do not see Microsoft as a threat, there's little question that some of Microsoft's competitors are worried about the company's role in the marketplace. One indication of this, according to the SPA's Hall, has been "a good deal of support from the industry" for the SPA's report on Microsoft. Hall notes, however, that few vendors are willing to speak out openly against Microsoft for fear of damaging their relationship with the software giant. "We have quiet support, but companies want their confidentiality protected," she explains.
Two of Microsoft's biggest competitors - Novell and Sun - are not afraid to comment on Microsoft's role, but neither company appears to buy the notion that Microsoft has undue control over network standards.
Michael MacKay, vice president of corporate architecture at Novell, points out that even proposals that originated at Microsoft are moving into an open industry arena in which Novell and close to 50 other companies are participating. "While the impetus may come originally from work that Microsoft started, in effect a much larger group of people and companies must participate before it can become a standard," he explains.
MacKay cites the WBEM initiative as one such proposal and the Directory Enabled Network (DEN) standard as another in which Novell and others are actively participating with Microsoft to define an industry standard. Even though DEN was originally proposed by Microsoft and Cisco, it concerns a technology area in which Novell, due to its extensive experience with directory services, has been able to take a leadership role. "We submitted and are continuing to move other schema design work for the management of Internet protocols into the DEN standard and are working very actively with the DEN group," MacKay says.
Like Novell, Sun doesn't see Microsoft as being in a position to dictate network standards. Rob Gingell, vice president and Sun Fellow, points out that the Internet evolved out of technology over which Microsoft had little or no control or input. As a result, it's hard for Microsoft to change the technical direction that the Internet and networks in general are taking, he says.
Gingell furthermore believes Microsoft lacks the power to unilaterally set de facto standards on the network. He says there is an advantage to creating technologies that do get adopted as standards, but that it is now impossible for any company - including Microsoft - to set up exclusive control of a key standard. "You have to get other people to code to it, something that isn't likely if the standard is seen as overly proprietary," he explains.
In addition, there are layers of network standards and protocols in which Microsoft has little or no influence. One example is digital subscriber line (DSL), the modem technology that increases the digital speed of ordinary telephone lines by a substantial factor over common V.34 (33.6K bit/sec) modems. "DSL is a physically layered mechanism, and Microsoft doesn't play at that level," says Kiran Narsu, director of remote communications services for Giga Information Group.
Times have changed
Even in those instances when Microsoft did try to promote its own technology as a standard, the company wasn't always successful. A relevant example is NetBIOS Extended User Interface, (NetBEUI), an enhanced version of the NetBIOS protocol Microsoft tried to promote as a de facto LAN transport standard. The company also supported TCP/IP but not in a robust fashion, making it difficult for Windows developers to code to TCP/IP. Microsoft lost that battle as the Internet swamped the network world. Today, Microsoft has retreated so thoroughly from its NetBEUI bias that the company's own internal network is now "100% IP," according to Sohn.
Jim Garden, director of Microsoft studies at Hampton, N.H.-based Technology Business Research, summarizes: "The view that Microsoft can control networking protocols simply doesn't hold water."
In other words, the landscape has changed since Network World published its series of articles on Microsoft's impact on network standards. Four years ago, Microsoft's domination of network standards seemed like an inexorable juggernaut. Today the company still wields power, but the rise of the Internet has reduced Microsoft's clout in the network standards arena.
The original client/server model assumed a high level of intimacy between the client and server portions of an application. Microsoft's presence in desktop operating systems carried enormous leverage under this tightly coupled paradigm because each client application had to be rewritten for each desktop platform. This made it much more economical to write to Microsoft's desktop APIs and standards than to alternative APIs and standards, simply because there were so many Microsoft desktops in the world.
Web-based computing, however, is changing the client/server paradigm. Applications written for the Internet, intranet or extranet no longer have to be as intimate with the client operating environment because the browsers - which are cross-platform - execute the client application. In addition, Web computing has encouraged many companies to implement client/server in a three-tiered architecture, with heterogeneous desktops on the bottom tier, Web servers in the middle and a legacy or database system running in the background as a top tier. While many client/server applications are still being written for Windows, there's enormous interest among customers in technologies, such as Sun's Java, which are not only platform independent, but also allow the client application to be supported centrally.
The Web has thus made network standards more important, while weakening the influence any individual vendor can wield on those standards. "There is a new paradigm today - the Web," says Dick Bradner, vice president of computing and communications at Cleveland-based National City Corp. "And network standards are the fundamental building blocks."
Web computing has made it difficult, if not impossible, for Microsoft to foist proprietary network software onto its customers.
"In the absence of the Internet, Microsoft had a major role in setting network standards," says Craig Metzler, senior vice president and regional director at Highway One, an advertising agency in San Francisco. "But Microsoft came to the market a little late, and now I don't think it has an omnipresent power."
In short, the Internet has changed the rules by putting a premium on truly open standards. And such standards are something that no company - not even Microsoft - will ever be able to provide without the cooperation of the rest of the industry.
James is the author of Success Secrets from Silicon Valley, (Times Business, 1998). He can be reached at www. businesswisdom.com.
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