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VNU Net: Microsoft trial: users told to check contracts

May 25, 2000, 13:37 (7 Talkback[s])
(Other stories by Linda Leung)

By Linda Leung, VNU Net

Whatever the outcome of Microsoft's antitrust trial, users shouldn't abandon the company too hastily because there are no viable alternatives, researcher Giga Information Group said this week.

Giga analyst Rob Enderle said that although there is no immediate panic for customers, they should review their contracts because users could end up paying for Microsoft's legal costs.

"Lock in guarantees on pricing, licensing and service and support, because no-one knows exactly how this suit will play out or when it will conclude," he told delegates at GigaWorld IT Forum 2000 this week.

"Don't jump ship, because there is nowhere to jump to. Unix is going back to being legacy systems, and Linux is not ready for you," he said, adding that he believed companies should use Microsoft partners, such as Hewlett Packard and EDS, as backup because they will work hard to protect customers from any negative outcome.

But users should not bet their businesses on future products that are not yet in beta, especially those that rely on Microsoft's entire portfolio such as next generation Windows services, because they may not be as effective if the company is split in half.

Giga believed that a Microsoft broken up into Baby Bills would be faster and better able to compete with emerging companies.

An operating system (OS) unit, for example, could consolidate systems and might even capture the Mac OS market with co-investment from Apple. This would create a blended system that would also free Apple to compete more effectively with other PC vendors.

An applications unit would be free to target the emerging internet market without fear of hurting Windows, while a consumer unit would be free to grow as a stronger competitor against AOL/Time Warner by acquisitions.

"Taking sides [in the legal dispute] is risky," Enderle concluded. "This is far from a done deal and finding yourself on the wrong side of how this will come out represents a larger risk than any related benefit."

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