Interface Based Monopolies

Microsoft clearly does not hold a monopoly in all software. Anyone can write software just as anyone can write a book or a song. But books and songs don't plug into each other and interoperate. And, unlike a writer or musician, Microsoft can force you to buy a license to its copyright when you buy your computer, and then by its own actions, declare your license obsolete. This is because Microsoft does hold a monopoly- on the specification of a public interface standard - the conventions by which all software appliances access computer services. 

An interface standard specifies the means of interaction between appliances and services. It must be stable, and described to the public in enough detail to encourage its broad adoption. Once so described, others can supply services and build appliances which "plug in" and interoperate correctly. The electric outlet and the telephone jack are interface standards which specify power and information conventions and allow various vendors to make the appliances which plug into the services provided by utilities. There are many new plug standards which have arisen in the computer age and are stable and well managed by the industries.

Because the specification of an interface is published, we would naturally expect free market capitalism to work on either side of  the interface - to bring down the cost of the service by allowing competitors to provide alternatives, and by allowing competing appliance vendors to lower manufacturing costs by focusing on one
rather than several interfaces.

However, there have been times when the nation has allowed its interface standards to be privately controlled, by an Interface-Based Monopoly (IBM). The telephone company was an IBM, which extended coast to coast and into our private property, successfully resisting the use of alternative telephony
appliances for decades. Similarly, the instruction set architectures (ISA) of computers, and the specification of Operating System services are interface standards because their specifications are widely published in order that many vendors can build appliances to plug in.

In fact, the instruction set architecture, or assembly language, of Int'l Business Machines 360 computer (also an IBM!) was so public that every computer programmer in the world was taught to write applications in it and interpret its core dumps. Being a published standard, of course, other computer companies could
produce "clones" of the IBM machines which merely had to run the
same code. However, as soon as a competitor like Amdahl  made the investment
in cloning their instruction set, IBM would "upgrade" the instruction set by adding a couple of new provably unnecessary instructions, and start selling a new machine with new software which depended on these redundant new instructions.
The competitor's shiny machine would thus not provide "full compatibility" with the "new standard," and would arrive on the market DOA.

Now imagine there was one company which "owned" the specification of the
electric outlet, and completely dominated sales of such outlets. Every few years
it could decide to add or remove the grounding plug, change the distance between the holes, morph them from rectangles to ovals, move from 60 to 90 Hz, etc.  These are not mere aesthetics, we are told, but technological advances demanded by interior designers! Moreover, the companies which made electric appliances colluded with this dominant company.  All new appliances would come with "EO'98" plugs compatible with the electric outlet designed for 1998. All new houses would, of course, come with the new outlets, since the company would let building contractors get them at or below marginal manufacturing cost. 
If you buy a new house, you have no choice but to get new appliances or upgrade all your old ones. Your "choice," when you need a new appliance, is to buy an out of date model, or to install new outlets in your house.

It seems so silly, yet this is exactly the pattern of monopolistic exploitation of
an interface standard which we must deal with when an Interface-Based
Monopoly (an IBM) arises. Such a monopoly can tweak the interface specifications unilaterally, supply new copyright code which "defines" the public specifications, and render all competitor's investments in supporting those specifications obsolete.

A few small changes to Microsoft's operating system interface, usually to fix
known bugs, or to destroy successful niche vendors by cloning and consolidating
their innovative functions, or to supply Microsoft's own appliances with
secret advantages, and hundreds of millions of users - public, private
and commercial - have to cough up license and upgrade fees which
include enormous and predictable windfall profits. 

When the proprietary Windows 2000 "standard" is issued shortly,  older software appliances will break in little ways and new appliances won't plug into existing computers, and so we will all be forced to purchase,  yet again, the same old code in a new package. In fact it won't even have a package - it will be downloaded to your disk while your bank account is charged.

Microsoft isn't the only IBM, but it is the most nefarious one today because it has no investment in hardware to hold it back. Intel is the only company which can add instructions to the current ISA. Adobe can tweak postscript and HP can tweak PCL, but older versions continue to be universally supported because they are instantiated in hardware. Sun wants to be the definer of Java, so its compilers are definitive. Netscape, was formed on the privatization of a public domain standard, and, for a while, held the power to add new conventions to HTML. This is the power that Microsoft grabbed away from Netscape - not the ability to give away browsers!

 The Microsoft Monopoly  itself  is not the disease, merely the biggest symptom of  the new intangible economy gone wrong. Neutering Microsoft will simply allow a new dictator to get in bed with Mammon.

 Copyright © 1999 J. B. Pollack