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FC: Was Microsoft's "Freedom to Innovate" idea a marketing tactic?
From: Declan McCullagh <declan () well com>
Date: Fri, 16 Feb 2001 12:26:02 -0500

[Forwarded with permission. I've attached some of the "Freedom to
Innovate" newsletters below. --Declan]

*********

From: "Damon Chetson" <dchetson () gmu edu>
To: <declan () well com>
Subject: RE: Belgian police raid online music traders; MS on open-source
Date: Fri, 16 Feb 2001 10:37:07 -0500

It's becoming apparent that Microsoft's "Freedom to Innovate" campaign may
have been nothing more than a marketing tactic to defend itself from the
Justice Department.  I thought MS was right (although I oppose copyright
law - I oppose the socialization of the cost of "IP" protection), it seems
to be acting now out of hypocrisy.

In fact, this brings up an interesting question which I think has been the
heart of TJ Rodger's argument against Silicon Valley lobbying the Federal
Gov't.  Once government is seen by the software industry as a way to protect
market shares, the software industry becomes indistinguishable from Chrysler
or ADM - another corporate welfare hog.


An email I sent MS:

As someone who supported Microsoft in its battle with the Justice Department
and sent letters to his congressmen, I am concerned by the comments of
Microsoft Corp.'s Windows operating-system chief, Jim Allchin, who said that
policymakers should look more closely at Linux and open source alternatives.

Microsoft owns its operating system, and through contractual agreements with
its customers, licenses use. As such, Microsoft is free to sue anyone who
violates user license agreements.  I support Microsoft's right to use its
property as it sees fit.

Indeed, at the core of Microsoft's claim against the Justice Department was
the idea that a free market in software development promotes innovation that
benefits all consumers.

If that argument is anything more than a cheap marketing ploy, then
Microsoft should reconsider Allchin's comments.  He argues, essentially,
that it's okay for Microsoft to innovate, but it's not okay for the open
source community to innovate.  The government ought not to interfere with
MS, but, he implies, should clamp down on open-source.

That's pure hypocrisy - a violation of the principle of the right to
innovate that MS supposedly upholds.  Innovation can happen along many
fronts - from new features in an OS to new forms of license agreements to
new strategies to handle the task of debugging software.  All of these
innovations are valuable, and that's the real promise of open source.

Microsoft should keep to its original principle and avoid lobbying the
government for what amounts to corporate welfare.

********

From: "Microsoft" <0_7263_A5B0396F-CD6D-D211-A466-00805FA7CAE6_US () Newsletters Microsoft com>
To: <declan () wired com>
Subject: FINFLASH FROM THE FREEDOM TO INNOVATE NETWORK
Date: Tue, 7 Nov 2000 10:25:59 -0800
Message-ID: <5d0d901c048e8$2d19c510$2383300a () cpmsftddsq04>
MIME-Version: 1.0

Thanks for supporting the Freedom to Innovate Network. We just want to =
remind you that today, November 7th, is Election Day and your chance to =
support your freedom to vote.

Polls continue to show that the race for the presidency will be the =
closest in 40 years.  In addition, control of the U.S. House and Senate =
will come down to the wire. So every vote will matter -- make sure your =
voice is heard! =20

For voter information and election returns in your state visit =
http://www.webwhiteblue.org/directory/

Thanks,
Freedom to Innovate Network=20

*****

From: "Microsoft" <0_9497_A5B0396F-CD6D-D211-A466-00805FA7CAE6_US () Newsletters Microsoft com>
To: <declan () wired com>
Subject: Freedom To Innovate Network Newsletter
Date: Mon, 15 Jan 2001 11:40:00 -0800

A FINFLASH FROM THE FREEDOM TO INNOVATE NETWORK
January 15, 2001

To cancel your subscription to this newsletter or stop all newsletters =
from microsoft.com, read the directions at the bottom of this message.

Class Action Lawsuits Dismissed in Maryland
On Friday, January 12, U.S. District Court Chief Judge J. Frederick Motz =
  dismissed the majority of class action lawsuits pending against =
Microsoft in proceedings in Baltimore, Maryland. It is unknown whether =
plaintiffs' attorneys will file an appeal in the face of the positive =
ruling for Microsoft.

Tech Companies Decry "Misguided" Antitrust Policies in Open Letter to =
Bush, Congress=20
Sixty small technology companies and the Association for Competitive =
Technology (ACT at www.actonline.org ) have published an Open Letter to =
the 107th Congress and Bush administration stating their concerns about =
the lawsuit's impact on the industry and the nation's economic success. =
The letter ran as an advertisement in the Washington Post and the Wall =
Street Journal, and warned that: "Misguided application of antitrust =
laws, such as the case against Microsoft, ignores the realities of our =
industry and could create disastrous new rules to govern competitive =
behavior in the 'new economy.'"=20

Antitrust Suit: Update
On Friday, January 12, the federal government and 19 states asked the =
D.C. Court of Appeals to uphold a lower court ruling in the government's =
antitrust suit against Microsoft that ordered the company to be broken =
up.=20
Microsoft will file its brief in response to the governments' on January =
29. Oral arguments are scheduled for February 26 and 27, with a final =
decision not anticipated for several months following those proceedings.

Starr, Dellinger, Bork Co-author Brief for Microsoft Competitors
Also on January 12, ProComp, a high-tech trade group of Microsoft =
rivals, including Oracle, AOL Time Warner and Sun Microsystems, filed a =
friend-of-the-court brief in support of the governments' case. The brief =
was co-authored, with Robert Bork and Walter Dellinger, former =
solicitors general, by former Whitewater prosecutor Ken Starr, whose =
investigation into the Monica Lewinsky scandal resulted in the =
impeachment of President Clinton. =20

Stay Involved
You can let public officials know how you feel about issues affecting =
Microsoft and the high-tech industry on the Freedom to Innovate Network =
website. To contact them, or just to stay up to date on the antitrust =
trial and other issues, go to =
http://www.microsoft.com/freedomtoinnovate.

*****

From: "Microsoft" <0_9958_A5B0396F-CD6D-D211-A466-00805FA7CAE6_US () Newsletters Microsoft com>
To: <declan () wired com>
Subject: Freedom To Innovate Network Newsletter
Date: Tue, 30 Jan 2001 10:44:25 -0800
Message-ID: <0b3601c08aec$ab42ca90$1983300a () cpmsftddsq01>

A FINFLASH FROM THE FREEDOM TO INNOVATE NETWORK
January 30, 2001

To cancel your subscription to this newsletter or stop all newsletters =
from microsoft.com, read the directions at the bottom of this message.

Microsoft Files Brief in Antitrust Case
Microsoft filed its reply brief with the United States Court of Appeals =
on Monday, January 29, detailing key issues that support reversal of the =
Federal District Court's judgment in the DOJ antitrust case.=20

The brief underscored the company's belief that Internet-related =
improvements to Windows are lawful because they make Windows better and =
benefit consumers. The government's concession that the Internet =
Explorer software should not be removed from Windows because it provides =
consumer benefits is an admission that Microsoft has met the 1998 Court =
of Appeals tying standard.

Microsoft also argued that the government's position that a desktop icon =
is a separate product is not sustainable, and that the District Court's =
comments and procedural irregularities provide ample grounds to vacate =
the trial-court ruling.
Oral arguments are scheduled for late February; a decision by the =
Appeals Court will be issued in the months following.
To see Microsoft's full brief, go to:=20

Microsoft's Reply Brief to the United States Court of Appeals

Microsoft Seeks Jackson Recusal in Employees' Suit
Microsoft has filed two motions in an employment discrimination class =
action case filed in Washington, D.C. One motion requests that the case =
be transferred as an efficiency measure. The second seeks Judge Thomas =
Penfield Jackson's recusal from the case because his public comments on =
the federal antitrust trial, over which he presided, have created an =
appearance of bias. =20

While Microsoft cannot comment on the discrimination litigation, the =
company's record is unambiguous: Microsoft has a zero-tolerance policy =
toward discrimination in the workplace, and the company's proactive =
outreach and investment efforts in attracting women and minorities to =
high-tech careers have been vigorous, sustained and successful.

One measure of the success of Microsoft's endeavors is the increase in =
the company's minority workforce, which has grown at nearly twice the =
rate of its domestic workforce over the last three years. At the same =
time the percentage of minority employees at Microsoft has risen =
steadily, from 16.8% in 1997 to 22.1% today.=20

Microsoft has invested nearly $100 million in financial support and =
software in recent years to help stimulate interest among minorities and =
women in scientific and technical fields, including an $86.4 million =
partnership with the United Negro College Fund's 39 member institutions.

Microsoft will continue to provide leadership in attracting women and =
minorities to high-tech careers - a challenging and complex issue across =
the industry.

Stay Involved

You can let public officials know how you feel about issues affecting =
Microsoft and the high-tech industry on the Freedom to Innovate Network =
website. To contact them, or just to stay up to date on the antitrust =
trial and other issues, go to=20

http://www.microsoft.com/freedomtoinnovate

******

From: "Microsoft" <0_10381_A5B0396F-CD6D-D211-A466-00805FA7CAE6_US () Newsletters Microsoft com>
To: <declan () wired com>
Subject: Freedom To Innovate Network Newsletter
Date: Mon, 12 Feb 2001 18:06:13 -0800

A FINFLASH FROM THE FREEDOM TO INNOVATE NETWORK
February 12, 2001

To cancel your subscription to this newsletter or stop all newsletters =
from microsoft.com, read the directions at the bottom of this message.

Policy Predictions

Haley Barbour, a former chair of the Republican National Committee, and =
Tom Downey, a Democratic Congressman from New York from 1975 to 1993, =
were on Microsoft's Redmond campus recently to speak to employees. Both =
men have had much exposure to issues critical to the technology =
business. Barbour and Downey took time to respond to this question from =
our employee newsletter, Micronews:=20

"What are your predications for the coming year for the high-tech =
industry with such a closely divided Congress and a new administration?" =


We thought FIN members would be interested in their responses:=20

Tom Downey: "Medieval maps of the world often depicted unknown lands =
with the legend "Here be dragons." The new, evenly divided Senate and =
the closely divided House face uncharted territory. Whether it is =
inhabited by dragons or not only time will tell.=20
=20
"However, there have already been surprising developments, not the least =
of which is the unprecedented power-sharing arrangement in the Senate. =
Most observers agree that this agreement was a brilliant accomplishment =
for Democratic leader Senator Tom Daschle of South Dakota. This is =
clearly a good deal for Democrats, and it will make it much easier for =
them to bring legislation that they care about to the Senate floor.=20
=20
"The technology community still has many powerful advocates in both =
bodies, and the role the high-tech community played for both parties in =
the recent elections ensures that the community's concerns will be =
heard. In one critical area, privacy, there may be a rough road ahead, =
because privacy policy, perhaps more than any other high-tech concern, =
cuts a broad swath in the consumer consciousness and is a classic issue =
for grassroots organizing. People who care little about market access, =
intellectual property, or H1-B visas and the labor supply do care about =
who gets to see what information about them and their families. Privacy =
has the potential to develop as a major issue for the tech community. "
=20
Haley Barbour: "The high-tech community can be proud that it helped =
enact a long and impressive agenda in the 106th Congress. From China =
trade to H1-B visa expansion, almost all of what the technology =
community sought it achieved. The agenda for the upcoming Congress will =
shift from seeking government help to primarily preventing government =
harm.=20
=20
"With concerns over Internet privacy high on the minds of policymakers, =
it's likely that a legislative battle lies ahead. It will be up to the =
technology community to work with Congress and the administration to =
prevent ill-advised privacy legislation. Also sure to receive attention =
will be potential copyright-law changes in response to litigation =
involving Napster and MP3.com. Legislation to give greater legal =
protection to databases will resurface, as well as attempts to extend =
the moratorium on Internet taxation. And finally, broadband will be the =
focus of Congress as it grapples with the so-called "digital divide." =
Sure to see action will be bills to deregulate the market for the =
provision of broadband services, particularly allowing the regional Bell =
companies more flexibility.=20
=20
"While not as lengthy an agenda as that of the last Congress, this =
year's will be equally important. The high-tech community is developing =
a special relationship with policymakers on both sides of the aisle. As =
we head into the 107th Congress, it is important that Microsoft and the =
industry nurture and extend that relationship. "


High-Tech Issues on the Horizon

Both Barbour and Downey have already been proven correct on many issues. =
Here are some of the high-tech issues Congress and policymakers are =
dealing with already:

Internet: The Congressional Internet Caucus will hold its first meeting =
of the session on February 14.  More than 30 companies will demonstrate =
innovative technologies for members of Congress and staff. Microsoft =
will display a pre-release version of its 6.0 Internet Explorer browser =
with P3P-based privacy-enhancing technology built in.

Privacy: The Federal Trade Commission will hold a workshop to focus on =
how businesses merge and exchange consumer information. Additionally, a =
number of bills that address privacy have been introduced in Congress, =
with hearings likely to be scheduled this spring.=20

R&D Tax Credit: As part of his $1.6 trillion tax cut plan, President =
Bush has included a proposal to make the R&D tax credit permanent.

Net Tax: Senator Ron Wyden (D-OR) and Representative Chris Cox (R-CA) =
have introduced legislation that extends the Internet tax moratorium, =
which is set to expire on October 31. The bill would also seek fast =
track authority for the Streamlined Sales Tax Project.


Antitrust Case: Next Steps
Oral arguments before the United States Court of Appeals are scheduled =
for February 26 and 27, with a decision by the Appeals Court to be =
issued in the months following.=20

Stay Involved

You can let public officials know how you feel about issues affecting =
Microsoft and the high-tech industry on the Freedom to Innovate Network =
website. To contact them, or just to stay up to date on the antitrust =
trial and other issues, go to:

******



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