From: philco@microsoft.com (Phillip Cooper)
Subject: Re: FCC will proclaim Microsoft is run by Communists! : )
Date: 31 Dec 92 16:55:27 GMT
Organization: Microsoft Corporation

In article <8236@lib.tmc.edu> jmaynard@oac.hsc.uth.tmc.edu (Jay Maynard) writes:
>In article <1992Dec29.172229.3466@microsoft.com> philco@microsoft.com (Phillip Cooper) writes:
>>All right, this mis-information being spread is getting a little out of
>>hand.  It is true that *one* type of licensing contract offered to system
>>vendors charges royalties per computer.  It is also true that another
>>type of licensing contract charges royalties per copy of OS sold.  There
>>are many variations of each, and they cover just about every conceivable
>>type of licensing you can imagine.  It is *completely* up to the vendor
>>to choose which contract to use.  If they choose to go with the one charging
>>royalties for each machine sold it is because they get larger volume
>>discounts and the vast, vast majority of customers want MSDOS anyway.  
>
>Not necessarily. For example, say that MS charges $8 per machine for the
>every-machine-gets-one contract, and $20 per license for the completely
>unbundled version. In each case, the vendor gets exactly the same thing: the
>right to preinstall DOS and Windows on his machines and provide a book that he
>gets to have printed of OS documentation.
>

First of all, neither you nor I know they difference in cost between the two
licensing agreements.  I would think that the spread is much less than you
are assuming here.  Second, they do not get exactly the same thing.  There is
an important distiction between the two which I will not bore you with again. 

>This would be a prime case of MS forcing vendors to sell DOS and Windows with
>each machine, whether or not the customer wants or needs it. (I can hear the
>cries now: "But they're not holding a gun to their head!"...to which I answer
>that force can be economic as well as physical.)
>

And again, I say who is forcing the vendors to sell DOS and Windows with
each machine??  Certainly it is not Microsoft.  We explicitly offer licensing
agreements that allow them to only pay royalties on copies of the OS which
are actually installed.  If anyone is forcing them, it is the 99% of their
customers who *demand* MS-DOS and Windows.  
 
>All that's now required is for MS to make these offers to each new computer
>vendor. Guess what: instant monopoly!
>

>(A company can have an effective monopoly with less than 100% of a market.)
>
>>If you don't like it, complain to the hardware vendor that chose this
>>licensing arrangement, rather than one which charges only for each copy
>>of the OS sold.  They are the ones, after all, that made the choice.
>
>...under severe economic pressure from MS. Practically speaking, if I want a
>new machine, I have to buy it with DOS and Windows preinstalled. (Fortunately,
>though, this may be changing; at least Dell is standing up to MS' pressure,
>and I can always go get a PS/Valuepoint...)
>-- 

What is this severe economic pressure we are applying?  Honestly, I just
don't understand your point of view.  Just as a data-point, I purchased
a new 486-50 two months ago that was not bundled with Windows.  So, I think
your statement above is more than a bit exagerated.  It is quite possible
to purchase a computer with DOS and Windows preinstalled. 

Phil Cooper
Newsgroups: comp.os.os2.advocacy