Too big. Too powerful. Too much of a monopoly. Too much money. Too many clever
people. Too much momentum. Too arrogant to see the writing on the wall? When I
learnt rugby at school I was taught that the bigger they are the harder they
fall. Could this be the case with Microsoft? And are the events of the last
month starting to have an effect on the software giant.

Bill Gates certainly sounded under threat at a Microsoft shareholder meeting
last Friday. In his first public response to an anti-Microsoft conference
convened by American consumer activist Ralph Nader, Gates called the offensive
on his company over the past month 'a witch hunt'. "Microsoft has a great
story to tell," he said. "This is not a country where success and great
products should be punished."

The month in review:

First Sun Microsystems sued them for not complying with their Java
specifications and including a few of their own Microsoft proprietary items in
the code distributed to Microsoft clients. There's hot debate on both sides of
this argument and there is certainly a camp that believes the trial will be
more of a marketing effort for Sun than a fight for the merits of the case.

Be this as it may, Microsoft have had to stand up in public and make a stand.
Their argument was clear, why should they include the bits of Sun's software
which allow it be run on other platforms besides it's own Windows operating
system?

Fair enough but a week later Janet Reno and the United States Department of
Justice (DOJ) filed papers against Microsoft for not complying with their
agreement of two years previous. In the filing they mentioned that Compaq
wanted to pre-install Netscape Navigator on computers they sold rather than
Microsoft's Internet Explorer. Microsoft told them to get lost and if they did
install Netscape's product instead of their own then they would lose their
access to install Windows on any computer.

Microsoft's strong position in the market obviously allows it to pick and
choose which agreements to follow by the letter and which to fight in court.
The DOJ asked for a million dollars a day. Petty cash to a company the size of
Microsoft.

Neither the Sun nor the DOJ case is likely to make a dent in Microsoft's
business in the short term. It does however play havoc with Microsoft's
carefully nurtured public relations image. Despite the PR efforts though,
people seem to treat Microsoft in the same way as they do the insurance
industry. It is a necessary evil. You have to have it but if there were
another choice we'd all rather take that.

While everyone is buying MS products this is not a problem. It does however
make their position in the market quite precarious. The problem is if they get
side-tracked while fighting off attackers on all sides (DOJ, Sun, The everyone
but Microsoft lobby, other competitors and Ralph Nader) and competitors are
able to position their products as a viable alternative then the transition
could be very sudden. There aren't many of us who stick with our insurance
companies because of loyalty. If someone offered us better cover at a better
price, we'd change tomorrow.

Microsoft is not likely to disappear in the near future. Nature does however
work in cycles and if I were Bill Gates, I would be looking to understand how
I'm going to ride the downhill cycle that may just be appearing on the
horizon. With his tremendous skill and energy I'm sure he could use the
downward trend as rejuvenation for the company that he has built so
successfully.