PC INDUSTRY: WAIT UNTIL NEXT YEAR Economy, Windows XP expected to breath life into computer market in 2002. http://www.techtv.com/money/businessnews/story/0,23008,3338887,00.html

(Boy I hope so)

-- Anonymous, July 27, 2001

Answers

No shit...

This is the worst I've seen the tech industry since 1986.... you would walk into a computer store and it would be like a morgue...

Tooth and nailing it right now, hope recovery's soon (XP saving things my rosy red ass!)

-- Anonymous, July 27, 2001

I think consumers are catching on to this old trick--yeah, replace that two-year old computer, put out another 1500 bucks plus for a new computer to handle the new software put out by Microsoft and its minions.

-- Anonymous, July 27, 2001

Old Git, I think you are right. On the one hand, I hope there is an increase in interest, which will benefit a lot of fine hard working folks in the computer field. On the other hand, if we continue to see a slip-slide in our econonmy, never mind a crash, the last thing most people will be spending their remaining money on is a new computer. The slow down in computer sales right now is just an indicator of what people, and companies, are willing to spend money on.

-- Anonymous, July 27, 2001

Well, around here a few hundred people are chasing the same four jobs. Sweetie's been laid off now for almost three months. We may hear something good today but I'm not holding my breath.

-- Anonymous, July 27, 2001

ChicTrib

Microsoft foes rally against new software

By Robert Manor Tribune staff reporter Published July 27, 2001

Microsoft Corp.'s new Windows XP operating system is drawing attacks from critics concerned about invasion of privacy, while also rekindling fears that the software giant is using its massive market power to stifle competition.

An extraordinary convergence of opposition, including privacy groups and one of Microsoft's former political allies, is pushing hard to block the company's planned launch of its new operating system.

The rising resistance comes as Microsoft races to get Windows XP to computer makers and retailers before the holiday season, when software sales peak. Microsoft stands to earn billions in profits from Windows XP, the latest version of its Windows operating system software.

In a complaint to federal regulators on Thursday, consumer advocates said features in Windows XP invade computer users' privacy by making it easy for Microsoft to acquire and share personal data.

Earlier in the week Sen. Charles Schumer (D-N.Y.), long a Microsoft supporter, accused the company of designing Windows XP to hurt business rivals and reduce choices for consumers. Meanwhile, the Senate Judiciary Committee, of which Schumer is a member, plans to hold hearings in September on Microsoft's business practices.

Their criticism comes at a sensitive time for Microsoft. The company is trying to negotiate a settlement of its long-running antitrust battle with the Justice Department. In Windows XP, critics see a repeat of the monopolistic conduct that got Microsoft into trouble in the first place.

At the heart of the dispute are new features in Windows XP: built-in software that allows users to send and receive instant messages, edit scanned documents and perform other functions, and a program called Passport that allows users to sign in and make purchases at many Internet sites.

Microsoft and its supporters say the features benefit consumers, who would otherwise have to obtain the software elsewhere. Anyone who has struggled to download software to play music or unsuccessfully tried to install software to view movies can find that and more ready to use on Windows XP. And Microsoft says Passport is a safe, private service that, among other virtues, allows shoppers a secure way to buy online.

Critics say that by expanding the capability of Windows XP, other software companies are certain to lose sales. Passport, they say, is a threat to privacy because it contains consumer information such as age, credit card number, occupation and marital status.

Instructions to join Passport and provide personal information pop up the first time a Windows XP user goes on the Internet.

"You need a Passport to use Windows XP Internet communications features," the instructions say. "Click here to set up your Passport." A special version, Kids Passport, targets children under age 13.

"They mislead people into believing that they have to use Passport to get to the Internet," said Marc Rotenberg, executive director of the Electronic Privacy Information Center, which filed the complaint with the Federal Trade Commission. The center, along with a dozen other consumer groups, wants the FTC to order Microsoft to make clear that registration to Passport is voluntary.

Too much information

In the complaint to the FTC, Rotenberg said Microsoft is free to give a Passport user's e-mail address to other companies. Web sites can collect information from users of Passport for commercial purposes.

Passport, Rotenberg said, "is possibly the biggest privacy issue facing consumers on the Internet today."

Microsoft has had problems in the past safeguarding private information about its customers. In 1999 a defect in Microsoft's Hotmail e-mail service allowed anyone to read the e-mails of millions of users.

Microsoft says Passport is carefully engineered to protect users and adds that using it is an entirely voluntary matter.

"Most of that [personal] data is not required," said Adam Sohn, product manager for Microsoft. He said that language that invites users to join Passport could be changed by the time Windows XP comes to market.

The Consumer Federation of America, which joined in the complaint to the FTC, has other concerns about Windows XP.

"It has an anti-competitive effect," said Mark Cooper, director of research for the federation. Cooper said Microsoft is adding features to Windows XP to grab sales from competing firms that sell similar software.

"They are bundling all this stuff in, and they are going to put any competing products out of business," Cooper said.

It pays to partner

One new Windows XP feature, known as optical character recognition or OCR, is software that allows users to scan in paper documents like legal papers or newspaper articles, then edit the words or add them to other documents. Microsoft licenses the technology from ScanSoft Inc. of Peabody, Mass.

That gives ScanSoft a big advantage over companies that sell competing software, critics say. "Because of the dominance of Microsoft, bundling with a product destroys fair competition," said Bo Yan, vice president of ExperVision. The Fremont, Calif., firm makes a competing OCR software program.

Yan noted that many of the features offered by Microsoft, whether for playing music or watching video, are bare-bones versions with limited capability. Consumers who want to upgrade must pay for more versatile versions of the software.

But Microsoft makes it easy to keep those purchases all in the family.

"There is a button in the Help area [of Windows XP] that you can use to connect to ScanSoft's Web site," said Chris Strammiello, senior marketing manager for ScanSoft. He predicted that connection would lead to "a whole lot of sales" for ScanSoft.

Microsoft defends its bundling of new features, saying it makes computing easy and simple for consumers.

"We believe that in order to stay competitive and provide customers with the features and functionality that customers want, we need to continue to add new products," Sohn said.

Microsoft has long been accused of predatory and anti-competitive practices. The federal courts determined last year that its dominance in operating systems had made it a monopoly.

But recently Microsoft has alienated even some of its supporters.

Schumer, for example, opposed a move to break up Microsoft. But on Tuesday the senator called for anti-trust regulators to go to court to block the release of Windows XP.

"It appears to me that Microsoft intends to maximize its monopolistic power, using XP as a platform to enter new lines of business while encumbering competitors," Schumer said in a letter to Microsoft.

Delays would be costly

It would be highly unusual for the Justice Department or the Federal Trade Commission to block the release of Windows XP. The government rarely takes such a step unless health and safety issues are involved.

But any delay would hurt Microsoft. The company wants to ship Windows XP code to computer makers in August so they can begin installing it on PCs to go on sale in the fall. Microsoft has set an October deadline for getting Windows XP to retailers.

Morningstar analyst Joseph Beaulieu follows Microsoft, and he said he doubts the company will be blocked from selling Windows XP.

"But it would be pretty tough for the company if there was a resurgence of antitrust action against Microsoft," he said.

Beaulieu also defends Microsoft's bundling of many software features into Windows XP.

"It's a big advantage for customers," Beaulieu said, because it makes features readily available to unsophisticated users while doing nothing to prevent more tech-savvy users from obtaining upgrades.

"Users can get up and running right away," he said.

Tribune staff reporter Jim Coates and Tribune news services contributed to this story

-- Anonymous, July 27, 2001