Read Netscape's Folly and Microsoft Should Be Punished
I really do think the Netscape lawsuit should not go forward. Netscape's complaints are without merit.
On the pricing issue. Netscape should not complain about Microsoft's practice of giving IE away at no cost. After all, when Netscape started, its browser was given away at no cost, which enabled it to gain a huge market share that took even Microsoft years to chip away.
On the bundling issue. This is a nonissue. It is not as if Windows has locked the user out of installing Netscape on his or her own computer by including IE with the OS. If a user really wants to use Netscape he can ignore IE or use Microsoft's own utility to remove its icon. By including IE, Microsoft gives the option for people to get online; is that such a bad thing? Besides, you could have used IE to download Netscape, so by including IE, Microsoft is actually giving you a way around IE. Now is that a bad thing for Netscape?
Lastly, on technical merit. Since IE 3.0, Netscape has lagged behind Microsoft in technical superiority, and this is borne out by numerous product reviews. I personally use both browsers and routinely find IE more stable and faster especially when working on an Apple computer.
The only reason that Netscape is litigating is greed. It sees a chance to make some cash and smear Microsoft. Its actions only serves to strengthen my belief that Netscape is the corporate equivalent of a crybaby. Well, as with crybabies, the best solution is to just ignore them, and that's exactly what the court should have done and what the jurors should do.
-- Jin Zhang
Megan McArdle makes several good points about Netscape's browser falling short of the mark as the best browser, but in doing so she misses the single most important point about what makes a market.
A market becomes a commodity market (a free market) when many similar and interchangeable products become available. The consumer, in a free market, can freely chose one commodity over another based on price, based on a flashy label, based on product loyalty, or whatever. There is no penalty for buying a Bud one day and a Coors the next.
We forget there used to be a market for desktop utilities. It's gone because of the market friction that begins with installation problems and continues to fears of incompatibility with existing operating system infrastructure.
I used to use Netscape and the free e-mail program Eudora. I now have a complete Microsoft Office suite including e-mail because I just don't have the time to fight with things that go bump in the night every time I change my configuration.
If Explorer and Outlook are truly the best software products, they would rise to the top in a free market. I don't know about you, but Outlook would be off my desktop in a nanosecond if I had the time to get Eudora back up and running and I wasn't afraid of some designed in market friction.
-- Michael Flynn
Ms. McArdle forgets to mention one even more important point to make about Netscape's loss in the browser wars: Netscape sucked. It was slow, it ate memory and hard drive space, it crashed every five minutes and it was ugly. AND it cost $40. Moreover, I came to these conclusions when I was only using Macs, meaning Microsoft easily kicked Netscape's butt even on someone else's OS. I hate Microsoft's business practices as much as -- or probably more than -- the next guy, but when it comes right down to it, IE is an excellent program, and would have won the browser wars eventually anyway. It sucks to be Netscape, but it's great to be the consumer.
-- Aaron Batty
I have to disagree with some of Megan McArdle's comments in "Netscape's Folly."
Megan states, "The first argument requires us to accept, without proof, that the majority of computer users are either awfully lazy or awfully dim" and then tries to disprove this. The simple fact is that most computer users are "either awfully lazy or awfully dim." At the moment, our Web server at work is being harassed by 16 Windows computers affected with the Nimda virus. How many stories, and how much news time, does it take some people to patch their systems? Surely, if Ms. McArdle's claims are correct these people would take the time to download the patches and fix their boxes. Remember, these aren't just boxes infected with an annoying virus, these boxes have a root exploit installed, and yet their owners are too lazy or too stupid to realize that they need to download something to fix it. And I'm not even talking about replacing the product installed with a new one, I'm just talking about making sure that the product install works like it should.
Later Megan states, "In the case of the market for browser software, the network effects stem not from the users but rather from the Web designers, who prefer to write code for a single platform." As a Web developer I can assure you that IE is not a single platform. And if you take the time to talk to application developers you'll discover that the Windows family isn't a single platform either. In fact -- and it's ironic really -- but we do all our design on Mozilla, which gives us the dream of "write once, run anywhere." Some tweaking is needed for Netscape 4.x and IE. Netscape 4.x problems are usually solved once for all platforms. IE problems can be more difficult and often only get fixed when we go live and IE users report problems on their combination of IE/Windows. Simply put, there are too many inconsistent versions of IE and Windows out there for us to test all the possible permutations.
As for the sysadmins saying, "Unix is just better," turns out they were right. Let me see, Unix has been around forever. Let me see: Apple, who used to use a proprietary core, now run a Unix; IBM, who stood behind OS/2 for years, is now encouraging people to use Unix; even Microsoft has claimed that NT's kernel was Unix-like. And perhaps more ironically, Linux (another Unix) is the cheapest OS in the marketplace.
Finally, Megan justifies IE's success saying, "It's free." After such an in-depth look into why IE apparently won, you'd think Megan could have taken the time to get it right. Actually, Netscape was free (for private users) long before IE was free. Microsoft tried to charge for IE, and no one bought it. Then they gave it away, and no one used it. Then they tied it to their browser. And all of a sudden it was a great product? Please! Turns out people are lazier than Megan thought. IE 3.0 was a piece of crap compared to NS 3.0, but people were so ignorant about what the Internet could be that they simply didn't realize the problems they experienced weren't the Net, they were the software.
Sorry, Megan, I just don't see your argument.
-- Rodd Clarkson
I don't know if Microsoft should be punished for its business strategies and behavior. I'm a programmer, not a lawyer. What I do know is good technology, and Netscape isn't it. Sure, a few years ago I was rabidly anti-Microsoft and wouldn't dare to go anywhere near Internet Explorer; it was Netscape all the way, baby! Then I started using Internet Explorer 4.0 at work and found it to be far superior to Netscape. Starting with the 4.0 versions of the browsers, IE was faster, more reliable and easier to use than Netscape. Netscape was (and still is) plagued by bugs, sometimes causing the simplest of Web pages to not work properly. Would Netscape have survived and stayed the dominant browser even if Microsoft had included it with Windows as well as IE? I rather doubt it. When your product of poor quality and better alternatives exists, you won't be around for long. After all, if Netscape is such a great browser, why is AOL considering using an open-source Web browser instead of the one produced by the company that it owns?
-- Ed Macauley
Megan McArdle writes that Internet Explorer is free. In fact, it isn't. You pay for Internet Explorer as part of your Windows license fee. (Don't believe it? Try downloading a "free copy" of IE onto your PC and running it without Windows.) Under this pricing system, you have to pay for Internet Explorer whether you use it or not, which makes it very difficult for Netscape and others to compete on price.
-- Jeremy Friesner
I read your article with interest, but could not help sensing bitterness or retribution in your arguments. Something akin to what socialists always seem to feel toward the wealthier and more productive capitalist nations of the West.
I do not pretend to know the technical points of law, or even to be computer savvy. I do know that the average computer user is happy with Internet Explorer as a free browser with the Windows OS. Also that Netscape shot themselves in the foot regardless of the actions of Microsoft. I also think you know it is not in the public interest to force consumers to pay for Netscape in the future, when they seem happy to use Internet Explorer as part of the immensely popular Windows OS.
In closing I would say, "Get over it." This all seems to be more of the mind-set where if something or someone is big or popular, they must be brought down, or at least humiliated and punished if not destroyed. Netscape comes off as greedy and resentful of Microsoft's success and popularity. I would also contend that most of the Microsoft bashers appear small and vindictive, like most small and less successful individuals do compared to those who contribute something useful or successful to society.
-- Richard De Vita
I am so saddened to see such a biased article. From this article, anybody can clearly see how much of a pro-Microsoft "fan" Megan is. She uses all the classic pro-Microsoft tactics that people use to justify Microsoft's actions, including, but not limited to, misrepresenting opinion as facts, half-truths, hiding of relevant facts and substituting them for irrelevant ones, and fudging facts in general. I hate to go nit-picking, but this article deserves it and it's the only way to stop these tactics, which are as bad as Microsoft's tactics themselves, if not worse.
"First, that the mere placement of an icon on a desktop -- or its absence -- can win or lose a market. And second, that Internet Explorer was inherently inferior to Netscape. Neither of these assumptions holds water."
The whole premise here is wrong. Best products don't necessarily win in the marketplace. There are examples of this all over history, so this argument is irrelevant. Also, it's not just the icon. It's the integration. Megan touches on the integration issue, but leaves out some important facts that I will discuss later.
"So lazy or dim, in fact, that they will use whatever software happens to be installed on their computer, regardless. Yet if this is true, why has Microsoft lost so much money on MSN and Microsoft Money, both of which occupied prime desktop real estate for years?"
What Megan left out here is that both MSN and Money are not free, and IE was. That makes a whole lot of difference. Not to mention networking effects, which Megan touches on later.
"But I can attest, from years as a computer consultant, that from the point of view of the consumer there's little difference between the browser and MSN -- it's damn near impossible to get either of them off your machine once they've been installed."
Here comes the integration point again. What Megan neglects to mention here is that when IE 4.0 came out, most consumer PCs were still shipping with 64M RAM. When Windows loads, it loads IE rendering engine at boot time. Thus, when a consumer launches IE, the launch is instantaneous, and they still have free memory. On the other hand, when the consumer launches Netscape, not only does it have to load its own rendering engine (which takes a whole lot of time), it takes twice as much memory (IE rendering engine plus Netscape) and thus, the machine would run out of memory, and Netscape would seem "very slow" compared to IE. This is where Microsoft's unfair tactics really hit Netscape as far as technological issues are concerned.
"Which brings us to the second assumption that Netscape needs us to make: that Microsoft's technology was inferior to Netscape's. After all, if Internet Explorer had been better than Netscape, Microsoft would have won anyway. And in that case, there are no damages for Netscape to collect on."
Again, irrelevant facts here. Best tech does not necessarily win in the marketplace.
"Back in my days as a consultant, I often had to fight for projects with the client's Unix administrators. I spent long hours passionately defending my platform against opponents whose arguments ran along the lines of 'Unix is just better.'"
Passionately? I detect bias right here.
"But I'm not building myself a heart/lung machine. I'm building an application server for Marketing. And your design costs five times as much."
I heard this excuse used before. It's just that -- an excuse. Not even counting TCO [total cost of ownership], the upfront cost for Unix systems is on par with Windows if not cheaper. When TCO is plugged in, Windows is always more expensive (can you spell "virus?").
"Technology people like certain things in a system. Above all they prize reliability, followed by powerful, elegant code. Because Microsoft doesn't do well under this set of standards, they leap to the conclusion, as Netscape wants us to, that Microsoft's unsavory practices explain its market power. But that is begging the question. If Microsoft's software is so bad, how did it get that power in the first place?"
Here is an interesting jump from a Unix vs. Windows argument back to Netscape vs. Microsoft argument. This paragraph just doesn't make sense -- and the point is?
"When Microsoft became a viable competitor, the other revenue streams on which Netscape had counted -- such as selling server software that was as tightly integrated with its browser as IE is with Windows ..."
This is just not true. Netscape Server is nowhere near as integrated with its browser as IE with Windows. NS Server can work with IE or any other browser, administration and all.
-- Lenny Primak
"Microsoft should be punished"? I say Salon should be punished for continually carping about the imagined sins of Microsoft and for siding with the loser companies who, unable to make it on their own, have entered an unholy alliance (Sun Micro, Oracle, AOL-Netscape, IBM, Kleiner Perkins Caufield, and Doerr) to crush competition from Microsoft. Anyone who thinks that Microsoft's tactics have not been widely and intensely utilized by this gang of losers is not qualified for cretin status. IBM itself was under litigation for a dozen years for antitrust sins until the Reagan administration let the issue die. This entire gang of four are widely known to use the same tactics Microsoft uses only with a lot less success. The Clinton administration including Clinton and Reno probably still doesn't know the difference between a computer and a toaster oven. The evil Joel Klein and David Boies -- a couple of psychopaths if ever there were -- were completely uninterested in the truth but only in their own success. I used to think that the big lie propagated by the gang of four and their ilk that the consumer has suffered from this lack of competition is just that, a big lie. Now I know that this big lie has truth to it in that competition by Microsoft has been obstructed by this jihad. And yes the consumer has suffered -- but the villains are the gang of four. The question remains what the hell is Salon's interest in this rape of competition by a gang of losers. Is Salon shilling for the computer industry. Are you guys bought and paid for by John Doerr? Are you so ignorant that you cant see the makeup of this anti-Microsoft juggernaut? Get busy and examine your real motives before you let any more of your anti-Microsoft crap out and give us some balance. In other words Salon should be punished!
-- Walt Steffan
Just wrong.
Maybe Netscape deserved to lose but Microsoft deserves to lose more.
In any business it is only a few percent difference between profit and loss. Microsoft's "free" distribution of IE certainly had an impact of a few percent.
"It isn't fair." That's right. And neither is the author's conclusion.
Didn't the author learn this in business school? Or is business still academic?
-- Ray Daly
I read all of Ms. McArdle's piece on Netscape and the browser wars, but I guess I could have stopped right near the top of the second page.
I am a self-taught Internet user who has been visiting the WWW since about 1995 and, while I am no expert, I couldn't help but laugh at her claim that "users keep right on switching to AOL, because it's better." Isn't that kind of like saying that McDonald's sells billions and billions of hamburgers because it's the best food in the world?
McArdle might be advised to check her mailbox. I seem to receive proof of AOL's continued success about two or three times a month.
-- Doug Hammond
McCardle's tenuous statements about Microsoft IE being better than Netscape and not needing integration to sell are refuted by ... Microsoft.
Microsft's own documents at the trial showed their conclusion that they could not gain market share on Netscape unless they tied the browser to the OS.
-- John Lederer
Megan McArdle's article about Internet Explorer employs some very sloppy thinking.
I agree with the main premise -- that Internet Explorer is a superior browser. But McArdle's comparison arguments are flawed. Discussing a user's preference for AOL over MSN -- a decision with significant financial repercussions as well as a determinant of one's e-mail address and other factors going forward indefinitely -- is quite different from a spur-of-the-moment impulse to use a particular Web browser. You can switch browsers whenever you feel like it, or whenever a clickable link in another program launches your system's "default" browser (IE) rather than the one you might have selected (Netscape). But AOL is getting money from you, and is the only way you can get your e-mail if you're a standing customer. The comparison is not applicable.
McArdle also loftily introduces the idea of "networking effects" and then disregards (or is ignorant of) precisely the nefarious way that Microsoft used this technique to push its browser. The dreaded "embrace, extend, engulf" Microsoft dogma created ActiveX and tried to take over Java and even HTML to remove their democratic underpinnings and make all Web content visible only in their browser. McArdle evidently doesn't understand this, or she wouldn't be lecturing us in this way.
Even the "free browser" argument gets garbled in McArdle's presentation. The point is that Microsoft can afford to support a free product indefinitely, while a company like Netscape cannot. This is a brilliant bullying tactic on Microsoft's part, since a free product is a boon to the consumer, and their motives appear less predatory.
Netscape isn't as good, but that's not the point of the antitrust suit. Netscape's 70 percent market dominance was not "monopolistic" as McArdle contends in her opening. Saying that IE is better, so nothing unseemly happened, is like saying that Nicole Kidman turns out to be a pretty good actress, so her marriage to Tom Cruise must have nothing to do with her success. Nepotism and Monopoly work the same way; they ensure success, even when the success is deserved. And that apparently is too subtle an idea for Ms. McArdle.
-- Jordan Orlando
After reading McArdle's article on Netscape's case (or lack thereof) against Microsoft, I was struck by the one-dimensionality of her argument.
The gist of her argument seems to spring from the idea that IE succeeded because it was a superior browser, not because Microsoft's illegal tactics affected the situation.
Her major point springs from the fact that both Microsoft Money and MSN have been trying to do the same thing, but Quicken and AOL still succeed because they're better.
Unfortunately, McArdle misses some very key differences between browsers and MSN/Microsoft Money:
First, IE made sure that people used it more by being made the default help file program as of Windows 98. This contributed to forced usage (as you can't use another program to view Windows' help file) and familiarity with the product. Neither MSN nor Microsoft Money found a way to force users to use them.
Second, IE 4.0 was good, but if you look at the changes with that and Netscape 4.0, the difference wasn't so radical to merit a 60 percent market shift. At that point, Microsoft had a browser that was comparable for the first time. It was not, however, so superior that everyone was raving about how good it was.
Third, MSN wasn't free, and it wasn't even comparably priced to AOL for the longest time.
Fourth, Quicken and AOL were much larger, and they were/are able to make sure that users have easy access to CDs for easy updating and installation. At the time of IE 4, users had to download Netscape, but IE 4 came installed.
Fifth, Microsoft Money and MSN don't share the same file formats, so it's not the same case. Microsoft could (and did) make subtle (and not so subtle ... ActiveX anyone?) changes to the Web standards, and force (overtly and covertly) companies to adhere to the new standards that, surprise, only work with their browser. Now, this is the de facto case. As a result, many sites only work with IE and not with any other browsers.
In any case, it's in no way clear that IE succeeded merely because it's a superior product.
It's also telling that McArdle doesn't bring up Microsoft Office as an example of inferior products that succeeded despite being inferior. Microsoft gave Office away and buried superior products like Lotus, Word Perfect and dBase.
-- Joe Sislow
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