SZ interview with Microsoft Germany chief Richard Roy
"We will build the internet platform of the future"
Initial architecture to be built on the new Windows 2000 operating system
February 23, 2000
It is a chill wind that is blowing in Microsoft's face since a U.S. court has criticized the monopolistic position of the enterprise. Besides that, the giant is getting new competition with the on-line alliance of AOL and Time Warner. Nevertheless, Richard Roy, chief of Microsoft Germany, sees a future for the company on the internet.
SZ: In connection with the cartel complaint against Microsoft in the USA, information has trickled down that says the Justice Department is thinking about a three-part division of the corporation. Do you still have an emergency plan stored away?
Roy: We will not need that. I don't think that things will go that far. Microsoft has not broken the law. Besides that, it has to be considered that the basis of legal dispute, namely the entire market environment, has changed.
SZ: Will the PC market in the age of the internet turn into a stage of near war?
Roy: The internet is creating an entirely new situation. The market is becoming infinitely big. The competition situation is changing. Think about the fusion of AOL and Time Warner, which will produce an internet giant which will put all others in its shadows.
SZ: The alliance between AOL and Time Warner is bringing on-line services and media content together. Doesn't that put the pressure on Microsoft? Is the company now missing a big media partner?
Roy: We don't see ourselves as being under pressure, and therefore will not buy a media business. The intention of the fusion of AOL and Time Warner is to have everything one uses be proprietary. That cannot be the goal of Microsoft. We would like to create a technical platform as broad as possible and therefore we cooperate with many media content providers in many countries.
SZ: The EU Commission is also scrutinizing Microsoft now. The business is said to be putting the competition at a disadvantage by coupling the PC and server programs with Windows 2000.
Roy: That is a reservation of a competitor. Our development goal was to provide customers and partners with an optimal operating system. We are convinced of that, because we have tested Windows 2000 with many software developers, customers and competitors. The accusations have no substance, but of course we will answer all questions from the EU Commission.
SZ: In Germany, there are still other apprehensions. Parts of Windows 2000 was developed by a Scientology adherent's firm. The Federal Office for IT Security (BSI) is therefore checking to see if users could be spied on with the software.
Roy: We minutely inspected the product from security aspects before it was licensed. We are convinced that there is no security risk. In order to end the discussion on an objective basis, we asked the BSI to again review the product for security risks.
SZ: How do the customers really react to all these accusations. Does it hurt business?
Roy: The cartel charges in the USA do not play a role for customer relations in the Federal Republic. The sales of the German daughter company are growing even faster than the income of the mother company. But of course we are concerned with the effects on our image. We are trying to make up for that by showing what we will do for the customers and for the branches.
SZ: There are experts who believe that the "Microsoft case" will soon solve itself because the business can no longer play a determining role on the internet. Has Microsoft missed out on its internet connection?
Roy: No way, we even have a very good position. For one thing, the PC is, by far, the most important device for access to the internet - and that is our domain. But our product strategy also covers supplementary internet devices with our Windows CE. The more devices there are, the greater is our market potential. We are also strong behind the scenes on the internet. The net providers need an enormous supply of server computers. Windows 2000 is a suitable operating system for that, and it is appearing at exactly the right moment.
SZ: Windows CE is not exactly an overwhelming success.
Roy: It does not have as dominant position as does Windows. The market share of CE for pocket, hand-held computers is between 25 and 30 percent. But that can also be looked at positively. We still have much to gain. By the middle of the year, the next CE generation will appear and be considerably more performance capable. By doing that, we will improve our position. But CE's chances do not lie only in that one area.
SZ: Where else then?
Roy: Windows CE is also a platform in several other areas of application, like game consoles, set-top boxes for digital televisions, car PCs or even industrial applications. For instance, Siemens is using CE in automation technology; the Kuka company for industrial robots. And Bosch wants to use the operating system for research and development of the Kfz navigational device.
SZ: One of the fastest growing markets in information technology is mobile phones. Microsoft has not yet succeeded in getting a firm position there. Now a joint venture with Ericsson has been agreed upon. Will CE get through the back door that way?
Roy: We will start a joint venture with Ericsson. But that is not dealing with Windows CE. The goal of that is to implement a browser based on Microsoft technology in cellular telephones, thereby making it much simpler to surf the internet over a mobile telephone than is possible today.
SZ: Microsoft is still active on another level of the internet, in on-line services. The results of that, in Germany anyway, were modest.
Roy: We still do not have the position in Microsoft Network on-line services. But we have reorganized MSN in the Federal Republic and started, several days ago, a new marketing offensive. I am sure we will rank well in the mid-term and get position number three under the German on-line services.
SZ: While Microsoft is investing billions in the USA to access citizens over the cable networks, the company is holding back in Germany. Why?
Roy: That is due to the fact that the lion's share of the cable networks in the hands of German Telekom. Nobody has been able to get past that. In the planned sale of the network, large investments are required which will not pay off for us. Therefore we have withdrawn our advertising for a share of the Telekom cable network.
SZ: Microsoft became big with the PC and then gained territory in the rest of the computer world. Where is the journey headed?
Roy: Now a two-stage computer system predominates in information technology - with clients and servers. We will build the internet platform of the future which links up with this classical concept of the world wide network. To that end, Microsoft is working on the project for the Next Generation Windows Services. An opening architecture for products and services is to arise on the NGWS basis, with which customers will only have to develop once but which will be able to be applied to the various devices. Bill Gates himself wants to pave the way for the next Windows Generation.
SZ: When will such a system become available?
Roy: I think in the next two to three years. We will introduce a real-life plan in May. The products appearing on the market now are all going in that direction. The concept will be built extensively on the new Windows 2000 operating system. It will also contain service elements. I can well imagine that in the future, new software versions will be downloaded automatically into devices over the internet.
SZ: Will Microsoft also offer "software from the socket" - programs which the user does not buy, but calls up over the internet and is charged for as needed?
Roy: If New Generation Windows is not going to be a blank: yes. The provision, however, is that customers and the market will accept such a system and that the infrastructure needed for it is available.
SZ: Bill Gates has recently given up management of the business to Steven Ballmer. What has changed in Microsoft?
Roy: Not much. As president, Steven Ballmer has been directing the business strategy and the daily routine for 18 months already. Bill Gates can now be more concerned with the long-term strategy of technology and products.
Interview: Walter Ludsteck
Windows in the hot seat
State and Church concerned about Scientology influence
February 19, 2000
by Hans Holzhaider
Munich - The Bavarian Interior Ministry had asked for a comprehensive analysis of Microsoft's Windows 2000 operating system from the Federal Office for Security in Information Technology (BSI) in January, after it was revealed that a portion of the software for that program had been delivered by Executive Software International, a California company. Executive Software belongs to professed Scientologist Craig Jensen. Therefore users in Germany expressed concern that Windows 2000 users could be spied upon by Scientology.
There is not an immediate need for action because the Interior Ministry and its sub-agencies have only just recently installed the Windows NT operating system, said Minister spokesman Michael Zeigler. Therefore Windows 2000 will not be implemented in the vicinity of the state government in the near future.
In October 1995, the Interior Ministry put a list of measures into effect which was supposed to prevent the state from giving contracts to companies which were under Scientology's influence. Since then, companies who bid for state contracts must sign "security statements" in which they verify that they do not operate according to the principles of the psycho-business founded by Ron Hubbard. The Microsoft corporation, however, is not affected by this list of measures, said Ziegler, "We cannot demand security statements from all the sub-contractors." SPD state assembly Representative Monica Lochner-Fischer has made a written inquiry which asks the state administration, among other things, how it will be determined that Windows 2000 is not being used in any Bavarian agency or in any company working with the state.
The Catholic Church is also concerned about Windows 2000. The sect speaker of the Munich and Freiburg Archdiocese has not been able to get a meeting with Microsoft. In the meantime they have become aware that that is not just a local problem and therefore they will ask the German archbishops conference to take over the matter, said bishopric spokesman Winfried Roehmel.
State Assembly inquiry on Scientology and Windows 2000
February 3, 2000
Visit http://www.heise.de and search their archive for the original article in German. Here is a review in English of the Heise article on Windows 2000:
The Bavarian government has been challenged to take a position on whether Windows 2000 will be installed in state agencies by SPD Representative Monica Lochner-Fischer. She was concerned that Windows 2000 contains a defragmentation program written by Executive Software, which is led by Scientologist Craig Jensen. Lochner-Fischer reminded the government of a 1996 decision which required the state not to financially support psycho-businesses like Scientology.According to Heise Online, Lochner-Fischer wrote, "The state administration essentially has to provide an explanation." Lochner-Fischer said she was not interested in banning Windows 2000, she just want Microsoft to provide an option that included a free choice of defragmentation programs. She was also interested in whether the government was going to apply the police of "doing business with the big man while shooting the small? (pab/c't)"
Microsoft lets Scientology talk drop
December 9, 1999
The discussion which was scheduled for Thursday, December 9, between Microsoft and staff members of the Catholic Church about the effects of the Executive Software Scientology company on Windows 2000 has not taken place. The German branch called off the appointment prematurely.
According to information received by c't, representatives of the Federal Office for Security in Information Technology (BSI) had also wanted to participate in the meeting. However, the Munich branch of the software giant was apparently piqued that the topic of discussion had been previously released to the press. Meeting participants would have "preferred to lead the discussion in public," commented company spokesman Kurt Braatz. "We'll get in touch with them."
Besides, Microsoft intended to plan a meeting with its large customers, it was said, "primarily in Hamburg and Bavaria." The Bavarian state government had made the award of public contracts "which include a special relationship of trust," dependent upon the filling out of a security statement. In that the contractor has to assure that "none of the people employed in the fulfillment of the contract used the technology of [Scientology founder] L. Ron Hubbard."
According to a statement by the Bavarian Interior Ministry, this does not present an obstacle to the introduction of Windows 2000 which is already in Beta test with the state administration. "We do not want to overreact," Ministry spokesman Christoph Hillenbrand said to c't. That decision would be more the result of a security check, which is currently being performed by the BSI.
The BSI is aware of this situation, but does not want to make any comment. However, the office will probably not issue the certification approval for Windows 2000 which Bavaria wants before it integrates "Diskeeper" by Executive Software. "We cannot review it without the source code," said BSI speaker Michael Dickopf, "That would be unprofessional." Microsoft speaker Michael Braatz responded that the contract with Executive Software did not permit Microsoft to hand over the program source code for review.