Chapter 4
Buying Brain Power

While Microsoft has such a good reputation among the general public, they have an nonexistent or even negative reputation in academia...

Microsoft makes huge profits. This money has to be spent someplace. The company has been criticized for not investing in research and not giving any money to education. So, with a dual objective of attacking new markets and restoring its technological reputation, Microsoft has started a major offensive all around the world to try to woo members of the scientific and academic communities. These operations are pure public relations: the gifts made to major universities are merely a way for the company to try to bask in some of the prestige and credibility that these institutions have. This was the reason behind the "large" donation of $20 million that was made to Stanford University, a few years ago, to pay for a building that would be named after William Gates. The building ended up costing much more, but Gates would not give any more money, and inside this building, some of the rooms bear the names of Japanese philanthropists! Many people in Stanford regret that, by accepting this money, the university helped give a reputation to someone who had never had one in the field of science.

But isn't Microsoft now seeking recognition from the scientific establishment?

Microsoft has started investing in research, and this investment now exceeds $3 billion per year. The company claims to have created the Microsoft Research Laboratory in Redmond in 1991, but this laboratory only became visible and significant in 1995. It employs two hundred researchers, who are split into twelve groups working on subjects ranging from voice recognition and decision theory to 3-D graphics. After this American investment, Europe was the next theater of operations: in 1997, Microsoft invested $100 million to open a research laboratory in Cambridge, England, which is very close to Cambridge University's Computer Lab. The company is also investing in start-ups in the area together with local venture capitalists. Microsoft Research at Cambridge is planning to hire forty researchers who will work mainly on computer networks, cryptography and programming languages. There is also a similar project in India.

I must point out that until recently Microsoft employees had no credibility among the scientific community. Up until 1995, I had never seen anyone from Microsoft make any significant contributions to high level conferences in the fields I work in, unlike researchers from companies such as IBM or DEC. The company's current goal is to change this image. Microsoft is trying to attract well-known mathematicians and computer scientists to its laboratories. Academia does not like this company, and it is trying to lure these researchers by offering them extraordinary working conditions. Not only are these scientists extremely well paid, but they are also truly free: they have no specific research agenda, and they can actually do whatever they want. It is also important to point out that companies that have traditionally had large research laboratories, such as Hewlett Packard or Digital (recently purchased by Compaq), are starting to run into difficulties financing them. People who want to do fundamental research with a huge budget and large salaries no longer have many choices. Microsoft uses these laboratories as a showcase for the press, its guests, and key customers; it shows them off in the same way as others would show their exotic curios or their collection of contemporary art to guests they want to impress.

But if Microsoft hires all these distinguished scientists, won't this have a positive influence on the long term quality and innovative character of its products?

It is difficult to say whether Microsoft will use what comes out of these labs to innovate. But the company's history tends to prove the opposite: a few years ago, Microsoft developed Xenix, a Unix system that could run on PCs. It owns the code and the rights that would have enabled its technicians to improve its file management system. But it has never used this technology. If we examine the motors behind Microsoft's progress, its success has never had anything to do with quality or innovation. There would have to be a cultural revolution within the company to change that. In any case, its current investments do not change my point of view of this company. Microsoft is simply shopping in the brainpower market, the same way as it goes shopping in the market for technology and innovative small businesses.

What will all this bring to the company? It will probably help improve its credibility, giving it a scientific alibi.

Microsoft needs this now more than ever. It is at a strategic turning point. It has been easy for the company to sell its software to the general public using advertising and the computer press. But now that it is trying to enter professional markets with products that are more technical, such as servers, database management, satellite control and banking software, it will have to prove that it has a solid technological background to come up with reliable products.

You seem to be very skeptical about these initiatives...

I suspect that there is a motive hidden behind these investments: if Microsoft's leaders really want to conquer 100% of the target markets that were mentioned earlier, as they lead people to believe, the company will need to overcome the last stronghold of resistance - academia. Because academia cannot be subjugated by just a few good articles in computer magazines. Here, where I teach, at the École normale supérieure, as in other universities, there are students and professors whose goal is to study the fundamental problems of computers, without being concerned with any one company's brand image. Here we study "how" problems can be resolved, and not "how much" money can be earned by breaking these solutions down to maximize profit.

This leads us to compare hardware and software based on many different standards, to look under all the hoods, and to examine thousands of lines of code to understand how these programs operate, what their faults are and what is hidden behind these faults. In the end, this allows us to develop a free and independent opinion as to the quality of different companies' products.

Do you mean that the ultimate goal of this offensive on academia is to eliminate our free will?

Let's take an overall look at this strategy. Microsoft sells mediocre products that we don't want at high prices, and this monopolistic company is forcing us to pay a tax on information whenever it changes its standards. We have no legal redress if the products do not work as we expect them to. But we do have one remaining freedom: that of thinking, evaluating and creating our own opinion independently by comparing different solutions. And we also have the freedom to want to choose something else. It is very important to be able to compare things to then make a choice among them. And this comparison is made in places where the stakes are not financial, but based on knowledge. These places are called schools and universities.

Microsoft considers this attitude extremely subversive, because most of the company's commercial efforts are geared toward insidiously eliminating consumers' freedom of choice, by making them accept this totally unjustified hodgepodge between open infrastructures, such as the Internet, and extraordinary tools like computers on the one hand, and Microsoft products on the other hand. Unfortunately, this hodgepodge seems to be winning. If you ask a novice computer user in Argentina what the Internet is, you have a good chance of hearing them answer: "A Microsoft product".

The ability to test programs, and to compare them with others which run better, is, in some way, the last bastion against a total "Microsoftening" of the computer business. But if we start as early as kindergarten by preventing people from seeing other products, this choice will no longer exist. A simple example of this: if you eat nothing but fast food, your taste is corrupted for life. You find it hard to imagine that you can eat better food.

Should we then systematically avoid any relationships between universities and companies? This seems artificial in a field where research is geared toward applications.

Not at all. But this does not mean that the universities must sell out! Balanced cooperation must not be confused with control. We need to understand our goals. Schools and universities have a mission, which is to provide our youth with a lasting long-term education that must therefore be a quality education. To allow students to do what is impossible to do in companies: experiment with many different tools, without clinging to any specific one. The goal of this is to help them develop the skills of critical analysis that will make them competent in their fields (whether this is the computer field or not). It would be wonderful, when teaching a course about databases, text editors, Web browsers, or network transmission protocols, to not only deal with the theoretical aspects. To be able to try out a large variety of commercial products, and not only open source software, that is largely used in universities because it is free.

Unfortunately, almost all companies want to "sell" their products to schools, in one way or another, either by actually selling them for money, or ensuring that they will be the only ones used in these courses. It is impossible for universities to pay the hundreds or thousands of dollars for each person who is briefly testing Windows NT or any other proprietary system. And professors have no desire to be a party to this type of free advertising by only teaching their students how to use Word, Excel, Windows NT, Sybase or Oracle.

What these companies could do –which is in their own interest actually– would be to help universities seriously evaluate their products, and to compare them with others in a reasonable scientific manner. But giving universities unfettered access to their products would have to be done for free. As far as software is concerned, where it costs absolutely nothing to make an additional copy of a program, publishers could very well just give these programs to universities.

The problem is, as we have seen, that this type of policy ends up being counter-productive for companies like Microsoft: it would break down the myth surrounding its name. This would also result in the training of generations of educated consumers. Educated enough, in any case, to see through the lies in its advertising propaganda, and denounce them as I am doing here.

Let us look at Microsoft's actions toward schools in France. The Gr@ine de Multimedia program, organized with Hewlett-Packard, gave twelve French elementary schools personal computers. The education part of the Compétence 2000 program is about teaching computer skills to university level students and to teachers in training. What do you think about those initiatives?

These are certainly nothing like the gifts that would be given by a benevolent philanthropist: it is important to point out that Microsoft is in a win-win situation with these operations. What they are actually doing is killing four birds with one stone.

First, the company improves its public image. Second, it makes our children prescribers of Microsoft products today, and future purchasers tomorrow. Third, it gets a foot in the door of key markets, such as the education market, which is becoming extremely large. And fourth, it eliminates free will at the very time when this is beginning to take root.

It has already reached its first objective: thanks to the docility of reporters, Microsoft received a free public relations campaign about this operation, where the company was generally shown as a philanthropist giving schools the tools to help them adapt to the information society. Microsoft gave away 2.5 million francs (almost $450,000) of software during the Gr@ine de Multimedia program. And in the newspapers, we read that Microsoft is giving away 30 million francs (more than $5 million) of software with the Compétence 2000 program. In reality, unlike what the company shrewdly leads people to believe, these are not gifts, or if they are, they are really cheap!

When Hewlett Packard gave away computers for the Gr@ine de Multimedia program, this cost them real money. Not the 15,000 Francs (more than $2500) retail price that a French family would pay for a Pavilion PC, but perhaps half that amount. However, when Microsoft gives software away (and with the Compétence 2000 operation, this is not even the case, because you need to purchase one copy of a program!), this really only costs the company about a dollar for each CD-Rom. So, the only gift is the money saved by the school (a few hundred or a few thousand dollars saved on purchasing licenses for each computer where the program is installed). What this comes down to is that the company is not making what it would have made if it had sold the programs at their normal price. So why is this philanthropy? The value of a gift is what it costs to the giver, not the theoretical market value. But this is exactly how Microsoft calculates its gifts in all the operations that it carries out, whether in the United States, France, Switzerland, or South Africa.

If it were a real gift, with no strings attached, the beneficiary would have a choice. Andrew Carnegie, the great American philanthropist of the beginning of the century, did not found Carnegie Mellon University by giving tons of steel from the Carnegie Steel Company factories. No, he gave money that the university was free to use to build buildings using the materials that they desired, whether it be bricks, wood or concrete. And he acted the same way with his public library project. Microsoft's "gifts", on the other hand, are just another way for them to catch their beneficiaries in the snare of their proprietary standards. If the company really wanted to be generous, it could just give away money that each school would use to buy whatever they want, even if they were to buy Macintosh computers or Netscape software.

But it is very difficult for these institutions with tight budgets to refuse hardware and software donations.

No, this is not really a problem. Because other solutions, which cost less than these so-called gifts, exist, especially for educational institutions: those based on open source software (see chapter 5). In addition, even if, at the beginning, these companies make enticing proposals to get into the market, nothing proves that they will not increase their prices afterward. This is the classic method used by drug dealers who give away the first dose for free. There are already some examples of this: in December 1997, Microsoft announced that they were eliminating "site licenses" in Japan, and began similar actions all around the world (note 39). This type of license authorized universities to pay for their software according to its actual use, rather than according to the number of computers where it was installed. These changes will bring about huge cost increases, that the Japanese will have to pay, because there are no competing companies that they can turn to.

Another reason to look for solutions based on open source software is that you can use computers that are supposedly out-of-date instead of the expensive computers that are needed to run Windows! There is an interesting example of this in Switzerland. In October 1997, the Swiss Ministry of Finance announced a deal with Microsoft, which was as follows: the Swiss government gave middle-schools 2,500 computers that they no longer used; and Microsoft gave the same number of licenses for Windows 95 and Internet Explorer, and also trained 600 teachers to use the computers. This cost much less than an advertising campaign, and in this way Microsoft was able to establish its hegemony on computers in middle-schools (and therefore, in Swiss companies when these students, who have never used any software other than Microsoft Office, reach the job market).

This initiative eventually collapsed. Why? Because most of the old PCs that the Swiss government gave to the schools had old chips –486s– that were totally unable to run Windows 95, which, as we have seen, requires powerful computers. So, if they want to accept "gifts" from the software monopolist, they would have to spend a fortune buying hardware. I hope the Swiss take advantage of this occasion to use open source software, such as Linux or FreeBSD, on all the computers that couldn't be used for anything else.

Is Microsoft carrying out similar offensives on schools in other countries?

We have already seen what has taken place in Switzerland. A program was offered to the University of Buenos Aires, in Argentina (and fortunately, refused). Some of my colleagues have mentioned that they were under pressure to accept the program, similar to the pressure used by the BSA against Antel in Uruguay. In the United States, where this situation has been around for longer, its conquest has gotten further. Here is an example: in 1997, California State University (CSU) gave their support for the creation1of a corporation called CETI, which was set up by Microsoft, GTE Fujitsu and Hughes Electronics. In exchange for an investment of several hundred million dollars over ten years for developing network infrastructure, CETI would have the right to select the computers and software that would be recommended by the twenty-three universities of the CSU system, that counts 350,000 students and teachers. Is this surprising? CETI's proposal only mentions Windows 95, Windows NT and Microsoft Office. Not only would CETI have had a decisive influence on the training of tomorrow's deciders, through the creation of specialized "proprietary" computer courses, but it also would have made several billions of dollars in profits over ten years. This commercial masterstroke, all of whose decisions were made behind closed doors by its managers, was just barely avoided thanks to the exceptional mobilization of CSU's students and teachers, relayed by organizations such as NetAction (note 40).

However, there are other lesser known –and poorer– universities that have already been "Microsoftened". Idaho State University Business School (note 41) offers courses in Web design, which is a good initiative. The problem is that when you visit their site, you discover that these courses are "based on Microsoft technology", and, what is more, are "sponsored" by Microsoft. The site's main page contains several advertising icons for Internet Explorer and BackOffice. The list of programs recommended for these courses only contains Microsoft software, and each one is the subject of a specific course module. Finally, there are two books recommended: one is a general book, and the other is published by Microsoft Press on OLE and ActiveX technologies (we have already seen the incredible security loopholes in these technologies). There are no traces, however, of books on the standard Web protocols such as HTML or TCP/IP, or on the most commonly used languages such as Perl and Java. These are certainly courses that will train managers who will be convinced that the Internet is a Microsoft innovation!

To better penetrate university campuses, Microsoft has also developed a small network of correspondents: a Brain Trust of a dozen leading personalities, called Microsoft Scholars. Microsoft, who pays these advisers $10,000 per year, is hoping that in return for this salary they will learn more about the best way to work with academia. These Scholars are obviously people who spend most of their time thinking about or giving lectures on how information technology is used in higher education. Many of these scholars –such as Steve Gilbert, a technology consultant affiliated with the Association For Higher Education, or Kenneth Green, who publishes an annual report on computers in universities– have direct influence on purchases of computer equipment by universities. Some people in the United States see this as a major conflict of interest: how can you remain impartial to a company that pays you? (note 42)

In addition to Microsoft's economic and financial power, one way it flexes its muscles is by maintaining a very positive brand image. This is done in such a way that most people see Microsoft as a synonym of cutting-edge software, and modernism. Why is the computer press, as well as the general press, so willing to present what you say is just a myth?

I think the reason for this is very simple: we are just human beings. And no one has really gotten used to the incredible speed at which changes occur in the computer industry. Journalists do not have enough time to analyze products in depth. And when they do it in a laboratory, they are usually limited to comparing commercial products that are relatively similar, sent to them by the vendors. They do not make sufficient analyses to point out that there really are alternative solutions. Is it because of ignorance or a lack of advertisers that the computer press has spent years basically ignoring the phenomenon of open source software, which is at the very heart of the Internet?

The other reason –and I have discovered this myself– is that writing articles understandable to the general public requires a huge amount of time and energy. It is very tempting to just copy information from a well-written press release, supplied by some software publisher. This is why it would be interesting to establish cooperation between universities and computer magazines: it is about time that computer journalists try to get quality information from universities and researchers, and that these people take the time to supply it.

The general press makes the same mistakes. When Microsoft announced that they would be investing 30 million francs in computer training in France, it took a fair amount of time, thinking, and knowledge, to imagine that these figures were merely hiding virtual money. It was then necessary to carry out an investigation to get a copy of the consensus statement that was sent to the universities, and that Microsoft, of course, did not include in its press kit. Finally, it took time to carefully read this very thick document. And if, in spite of all this, a reporter writes articles that cause problems for Microsoft, the impenitent writer is likely to be assigned a "tutor" from the Waggener-Edstrom agency, who handles Microsoft's public relations. Or, in most serious cases, from Microsoft itself, as a recent article from the San Jose Mercury News shows (note 43).

It must also be emphasized that Microsoft has become a virtuoso at lobbying and public relations. They never used to need this before, but now that they are being investigated for antitrust violations, this is very useful. What does the leading software publisher do when controversy is stirred up about its hegemony? It acts as a defender of the arts, culture and education. The build-up of its image has become a strategic weapon for Microsoft, in recent years, and is the focus of huge investments.

But, when the Internet is full of newsgroups such as alt.destroy.microsoft or Web sites such as stopgates.com or enemy.org (note 44), it is also important to touch up its image with the general public! Bill Gates, who was never before interested in charity, recently went on a tour of the United States announcing the creation of the Gates Library Foundation, which will finance computer equipment for sixteen thousand libraries in inner city neighborhoods (note 45). Microsoft also organizes trips to Redmond for journalists, politicians and VIPs from all around the world. All of its international subsidiaries also organize luxurious press junkets, where Microsoft explains its vision of the industry, and gives out information on its latest products. Because of all of these events, there is a certain collusion between media editors and Microsoft managers. How could these publications make serious criticism of the generous advertisers that keep them alive?