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ONLINE SPECIAL REPORT April 27, 1999

Linux "Lacks an Extraordinary Number of Features" of Windows
In a Q&A, Microsoft Windows 2000 leader Ed Muth provides Redmond's take on the upstart OS

If Linux delivers on everything that its proponents promise, one company has more to lose than anyone else: Microsoft. Its hold on 95% of the desktop operating system market is safe in the short term, but its plans for future growth are based on Windows 2000, which is the next generation of its NT server operating system. When Windows 2000 is released, which Microsoft says will happen sometime late this year, it will go head-to-head with Linux for the small to midsize server market.

To get an idea of how Microsoft is preparing for this battle, and how seriously it takes Linux as a competitor, Business Week Online writer Sam Jaffe recently spoke with Ed Muth, a senior executive at Microsoft who is the Group Product Manager for Windows 2000. Here's an edited transcript of their converstion:

Q: Is Linux a full-featured, complete competitive threat to Microsoft's Windows NT today?
A:
We view Linux as a competitor. We take all competitors seriously. Linux is one example of the vigorous competition in operating systems today. It's an interesting example because it is different both technologically and in terms of its channel and business model.

You asked if it was a full-featured operating system in a way that Windows NT might be, and the answer to that is clearly no. It lacks an extraordinary number of features that you find in Windows, including transaction features, Web features, security features. It also lacks a port for the great majority of hardware platforms in the marketplace. One of the implications of your question is, do I see Linux as a competitor principally to Windows NT. Many industry analysts say that it is primarily a threat to low-end Unix systems, where the expertise is much more similar to what you need to run a Linux system. Clearly those groups will have to speak for themselves, but it's important to note that Linux doesn't compete just with NT in the marketplace. In fact, its impact will be felt more by other operating systems.

Q: Is the development of Windows 2000, the next generation of NT, changing because of Linux? Is Linux one of the reasons why W2K is late to market?
A:
Windows 2000 is coming along beautifully. We are on course to ship the third and final beta in April, just as we have promised for a long time. We're making good progress to complete the product with the expectation of shipping it this year. Industry interest around the product is very high. More than half a million customers will participate in the beta for Windows 2000, which is a level of customer acceptance greater than the installed base of many versions of Unix. Linux has had no effect on the development of Windows 2000.

Q: Is it possible that Microsoft might use the open-source model for future versions of its operating systems?
A:
Microsoft, although this is not generally known, does license the sources for Windows to universities and the research organizations around the world. More than 50 of these licenses have been executed so that state-of-the-art computer science instruction and research can be done on the foundation provided by Windows and specifically Windows NT.

We also distribute other types of source code. For instance, we supply device-driver code to manufacturers so that they are free to reuse the code to build their own device drivers in an effort to improve device-driver consistency. We are always looking for ways to make Windows even more accessible and interesting to the marketplace, and we have an open mind about ways in which we might work with the marketplace in the future around the issue of greater access to source code.

Open source means different things to different people. For some it means source-code access. For others it means giving up any intellectual property rights to code. Certainly, our interest is much more the former, providing access in appropriate ways to researchers and scientists as opposed to business models which would cause us to surrender intellectual property rights and those of our stakeholders to the Windows sources.

Q:Do you foresee the "free" aspect (that's free as in monetary terms) of Linux and other open-source models eventually forcing Microsoft to lower prices for its operating systems?
A:
Microsoft does distribute a great deal of free software. There is a great deal of free software in terms of tools and utilities that are part of a resource kit. On the general issue, developing software is a high-tech, capital-intensive process just like developing pharmaceuticals or chip plants. It requires people and laboratories and testing and verification equipment.

High-quality software comes from having adequate capital and consistency of purpose in order to deliver great software to the marketplace on a regular basis with features that move the state-of-the-art ahead rather than copy things that people have historically done. In general, the free software movement is not going to be a viable model for achieving those market goals, although there certainly is a place for it, along with other models, in the marketplace.

Q: Can you spell out a little bit more clearly why you believe the proprietary source code model of software development as practiced by Microsoft is superior to the open-source model?
A:
Well, fundamentally it's the same reason that all other high-tech industries are organized around the world. It's the same reason why jet planes aren't free or that power plants aren't free. In order to move the ball ahead for the industry and for the consumer, you need to have consistency of purpose, which of course the Linux movement does not have. It has no long-term road map, and it can't have one because it's an atomistic, developer-driven movement rather than a commercially and customer-based movement.

And you need the resources to do the work that will have the long-term, multiyear payoff. For example, component software models, like natural language queries, speech recognition, improvements in the graphical user interface, pervasive multilingual and multicultural features in the operating system. These are all areas that require a consistency of purpose and a consistency of management and a level of capital investment that is not compatible with the so-called free software movement.

Q: Can you say how important leadership is? Microsoft has Bill Gates and Linux has Linus Torvalds, but they play very different roles. How important is your CEO to the development of the operating system?
A:
Leadership is important in all human endeavors, but Windows is bigger than any one person or even one company. Windows is an authentic industry phenomenon with thousands of software companies, millions of developers, dozens of high-volume, sophisticated [original equipment manufacturer] developers that are driving this forward.

Q: There are rumors that Microsoft is developing a Linux version of its Office suite. Can you confirm or deny those rumors?
A:
There are no plans to port Office to Linux.

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