I am finally getting around to linking a witty and highly perceptive article by Michael S. Malone, author of ABC News’ Silicon Insider column, writing in Monday’s Wall Street Journal, which I’ve been wanting to recommend to friends.

If you look at Microsoft with an objective eye, it becomes apparent that it is a giant company past its prime. It is big and rich, but increasingly toothless. It is able to use its money to put on a great show at the Consumer Electronics Show, underwrite an interesting market initiative — or buy another big company — but it no longer has the fire of ambition or the addiction to risk to ruthlessly execute on those desires any more. As has been noted before, once you look past all of the high profile moves (such as MSN, MSNBC, Zune and XBox), Microsoft has only really been as successful as it reputation would suggest in just two businesses: Windows and Office. Most everything else is flash.

Even Microsoft’s full-out assault on Netscape (which, ironically, will officially die on March 1) for control of the Internet browser industry — justly earning it the sobriquet “Evil Empire” — in retrospect was less a brilliant maneuver by Gates & Co. to capture a hot new industry and more a desperate (and questionable) scramble by a market leader caught napping.

That corporate somnolence, rather than its more-remembered ruthlessness, has far better characterized Microsoft over the past decade. Even the Vista operating system, the most recent upgrade of Microsoft’s core product line, managed to be so late that it almost crippled the personal computer industry. It finally arrived to a chorus of boos, most of them undeserved (it’s a pretty good operating system), but some dead-on (it’s a technological hop when it should have been a leap). Microsoft lost its killer instinct a long time ago. On the rare occasions when the mood resurfaces, the company doesn’t have the chops anymore to execute on its desires.

And that brings us to the Microsoft-Yahoo deal. For all of the excitement, this is just big, rich, but slow-moving giant looking to buy another slow-moving giant, the latter having stuck to an obsolete business plan too long and lost its way. The scheme is less predation than it is desperation: In the world of search, Google owns these two lumbering monsters.

Microsoft understandably covets the sheer size of Yahoo’s subscriber rolls, believing it can accomplish what Yahoo has failed to do: convert more of those 130 million monthly visitors into real, paying customers. But Microsoft has hardly shown it can do that at MSN. So, can it really find a solution to Yahoo’s structural problems?

That remains to be seen — and Microsoft’s one genius is as a late adopter. The real problem Yahoo — and perhaps soon Microsoft — faces is that those legions of Yahoo users don’t want to be stuck inside a small corner of the Web, not getting all of the experiences and services (like live TV and first-run movies) they were promised. Especially not when they can run around and find all of those things, in abundance, elsewhere on the Web. Microsoft is even less prepared to solve that problem than Yahoo.

That leaves search, which is probably the real reason Microsoft wants Yahoo. Combining the two search engines would, in terms of sheer numbers, represent the biggest challenge to Google to date. But the sum of two also-rans is almost never a winner — unless the newly merged is very, very lucky in its competitors. That’s what happened with HP and Compaq: Who’d have guessed that Dell would suddenly fall on its face?

Incredibly, the same may happen with a Microsoft-Yahoo deal if it happens. If you look at the stock market, peruse the industry gossip blogs, follow the departure of key employees, or read about the various new initiatives (energy?) the company is pursuing, it becomes increasingly apparent that Google is a company about to have an early midlife crisis. Microsoft-Yahoo may turn out to be a pedestrian idea with absolutely brilliant timing.

If that is the case, and the merger proves successful, it will have more to do with Google than Microsoft and Yahoo. Which is why the feds should stay out of it.

So, Yahoo: Take the deal (unless a better one comes along). Microsoft: Let this be the first of many high-risk moves. Treat Yahoo as a heart transplant, not a skin graft. And Google: This new competition should be a warning to stop fooling around and get back to business.

John Murrell at Good Morning Silicon Valley reports on Microsoft’s $31 a share offer for Yahoo.

You could watch it playing out like one of those “nature, red in tooth and claw” documentaries. There was the wildebeest (played by Yahoo), slowed by a nagging groin injury, gradually starting to fall behind the herd. The vultures and hyenas (played by analysts and pundits) were starting to circle and salivate, respectively. Then, off in the tall grass there’s a stirring, then an explosion of dust as the lion (played with scenery-chewing enthusiasm by Microsoft) springs at its quarry and sinks its teeth into the back of its neck. Sensitive viewers may want to turn away.

As Computerworld observes, those geniuses up in Redmond have taken another giant step toward persuading their customers not to trust them.

Microsoft Corp. deliberately broke access to older files, including many generated by its own products, to step up security with the newest Office 2003 service pack, a company evangelist said yesterday.

The months-old Service Pack 3 (SP3) for Office 2003, said Viral Tarpara, a U.K.-based IT evangelist for Microsoft, blocks old file formats for security purposes. “Some older file formats, including some from Microsoft, are insecure and do not satisfy new attack vectors that hackers can use to execute malicious code,” maintained Tarpara. “The decision to block the formats is strictly to protect your machine from being compromised.”

Office 2003 SP3 was released in September, and questions about file access error messages began appearing almost immediately on Microsoft’s support forums.

Those questions continued into December. A user identified as “dberwanger” complained that he called Microsoft’s support desk, but was told it would cost $250 to “fix a problem with SP3 that they created. Finally completely uninstalled Word 2003 and reinstalled (because you cannot just uninstall SP3) and the problem is fixed.”

Microsoft has posted a document to its support database that includes a Windows registry hack that returns full file format access to Office 2003. Like Tarpara, the document claimed that the file blocking was done for security reasons. “These file formats are blocked because they are less secure. They may pose a risk to you,” according to the document.

Among the blocked files are older Microsoft Word, Excel and PowerPoint formats, as well as older formats used by Lotus 1-2-3 and Corel Corp.’s Quattro Pro — a pair of ancient and aging spreadsheets — and Corel Draw, an illustration program. Word 2003 with SP3, in fact, blocks a staggering 24 former formats, according to Microsoft, including the default word processing file format for Office 2004 for Mac, the currently available edition of Microsoft’s application suite for Mac OS X.

Coding Sanity, like many, is improving his new PC’s performance by “upgrading” in the direction of the past.

One really has to marvel at what an organization with the financial resources and human talent at Microsoft’s disposal is able to accomplish.

there appears to be no contest. Windows XP is both faster and far more responsive. I no longer have the obligatory 1-minute system lock that happens whenever I log onto Vista, instead I can run applications as soon as I can click their icons. Not only that, but the applications start snappily too, rather than all waiting in some “I’m still starting up the OS” queue for 30 seconds or so before all starting at once. In addition, I have noticed that when performing complex tasks such as viewing large images, or updating large spreadsheets, instead of the whole operating system locking down for several seconds, it now just locks down the application I am working on, allowing me to Alt-Tab to another application and work on that. I am thrilled that Microsoft decided to add preemptive multitasking to their operating system, and for this reason alone I would strongly urge you to upgrade to XP. With the amount of multi-core processors around today using a multitasking operating system like XP makes a world of difference.

In addition, numerous tasks that take a long time on Vista have been greatly speeded up. File copies are snappy and responsive, and pressing the Cancel button halfway through actually cancels the copy almost immediately, as opposed to having it lock up, and sometimes lock up the PC. In addition, a lot of work has gone into making deletes far more efficient, it appears that no more does the operating system scan every file to be deleted prior to wiping it, and instead just wipes out the NTFS trees involved, a far quicker operation. On my Vista machine I would often see a dialog box from some of my video codec’s pop up when deleting, moving or copying videos. No more, now all that is involved is a byte transfer or NTFS operation.

Automatic Updates has also gone through a performance facelift in that it no longer hogs your bandwidth when you’re surfing, a nice touch. …

To be honest there is only one conclusion to be made; Microsoft has really outdone themselves in delivering a brand new operating system that really excels in all the areas where Vista was sub-optimal. From my testing, discussions with friends and colleagues, and a review of the material out there on the web there seems to be no doubt whatsoever that that upgrade to XP is well worth the money. Microsoft can really pat themselves on the back for a job well done, delivering an operating system which is much faster and far more reliable than its predecessor. Anyone who thinks there are problems in the Microsoft Windows team need only point to this fantastic release and scoff loudly.

Well done Microsoft!

Hat tip to Karen Myers.

Michael Geist, in the Toronto Star, points out some things about Microsoft’s new Vista operating system, which are enough to make me think twice about my future OS plans.

For the past few months the legal and technical communities have dug into Vista’s “fine print.” Those communities have raised red flags about Vista’s legal terms and conditions as well as the technical limitations that have been incorporated into the software at the insistence of the motion picture industry.

The net effect of these concerns may constitute the real Vista revolution as they point to an unprecedented loss of consumer control over their own personal computers. In the name of shielding consumers from computer viruses and protecting copyright owners from potential infringement, Vista seemingly wrestles control of the “user experience” from the user.

Vista’s legal fine print includes extensive provisions granting Microsoft the right to regularly check the legitimacy of the software and holds the prospect of deleting certain programs without the user’s knowledge. During the installation process, users “activate” Vista by associating it with a particular computer or device and transmitting certain hardware information directly to Microsoft.

Even after installation, the legal agreement grants Microsoft the right to revalidate the software or to require users to reactivate it should they make changes to their computer components. In addition, it sets significant limits on the ability to copy or transfer the software, prohibiting anything more than a single backup copy and setting strict limits on transferring the software to different devices or users.

Vista also incorporates Windows Defender, an anti-virus program that actively scans computers for “spyware, adware, and other potentially unwanted software.” The agreement does not define any of these terms, leaving it to Microsoft to determine what constitutes unwanted software.

Once operational, the agreement warns that Windows Defender will, by default, automatically remove software rated “high” or “severe,” even though that may result in other software ceasing to work or mistakenly result in the removal of software that is not unwanted.

For greater certainty, the terms and conditions remove any doubt about who is in control by providing that “this agreement only gives you some rights to use the software. Microsoft reserves all other rights.” For those users frustrated by the software’s limitations, Microsoft cautions that “you may not work around any technical limitations in the software.”

Those technical limitations have proven to be even more controversial than the legal ones.

Last December, Peter Gutmann, a computer scientist at the University of Auckland in New Zealand released a paper called “A Cost Analysis of Windows Vista Content Protection.” The paper pieced together the technical fine print behind Vista, unraveling numerous limitations in the new software seemingly installed at the direct request of Hollywood interests.

Guttman focused primarily on the restrictions associated with the ability to play back high-definition content from the next-generation DVDs such as Blu-Ray and HD-DVD (referred to as “premium content”).

He noted that Vista intentionally degrades the picture quality of premium content when played on most computer monitors.

Guttman’s research suggests that consumers will pay more for less with poorer picture quality yet higher costs since Microsoft needed to obtain licenses from third parties in order to access the technology that protects premium content (those license fees were presumably incorporated into Vista’s price).

Moreover, he calculated that the technological controls would require considerable consumption of computing power with the system conducting 30 checks each second to ensure that there are no attacks on the security of the premium content.

Good grief! I can just imagine how many programs will get removed by Defender.

Microsoft announces the release of new versions of its flagship products.

Preston Galla of PC Word has 15 reasons to switch to Vista.

But Mike Elgan of Computerworld has some compelling arguments as to why you should wait to get Vista already installed on your next PC, or just switch to a MAC.

Those jolly little elves at Microsoft and AMD handed out to a number of bloggers (but not this one, alas!) as Xmas presents for review purposes brand new Acer Ferrari notebook computers, retailing for $2,299.

But, predictably enough, jealous grinches (who obviously didn’t get theirs) started accusing the elves of Redmond of bribing bloggers, forsooth.

APC

Slashdot

So, inevitably, the elves got nervous and upset, decided it was safer to turn Indian-giver, and send the fortunate bloggers the following request:

Just to make sure there is no misunderstanding of our intentions I’m going to ask that you either give the pc away or send it back when you no longer need it for product reviews.

Hat tip to Techmeme.

With Google and Yahoo playing ball with the Communist regime in China, Microsoft (of all companies) is talking about possible non-cooperation.

A senior executive for Microsoft has said the firm could pull out of non-democratic countries such as China.

Fred Tipson, senior policy counsel for the computer giant, said concerns over the repressive regime might force it to reconsider its business in China.

“Things are getting bad… and perhaps we have to look again at our presence there,” he told a conference in Athens.

“We have to decide if the persecuting of bloggers reaches a point that it’s unacceptable to do business there.”

“We try to define those levels and the trends are not good there at the moment. It’s a moving target.”

BBC

Failed demos are really embarassing, aren’t they?

Ambient noise? what ambient noise??

Cruel, very cruel.

link

Jarod Lanier (above) writes about Technology the way certain of my college friends used to talk about these kinds of things after a couple of hash brownies. This specific (brilliant, crossing the barriers of a variety of separate and distinct topics, wildly original and speculative, and a trifle daft) form of discourse was referred to in our circles as space-ranging. Criticized by his interlocutors for his prolixity, for the profusion of his ideas, for their chaotic disorganization, and for indulging in the characteristic intellectual overreach of the seriously stoned, one Early Concentration Philosophy classmate of mine, had on a particular occasion declared memorably in his own defense: “I am a Space Ranger!”

As the rings of Saturn fade distantly in the view-finder, Lanier remarks:

As it happens, I dislike UNIX and its kin because it is based on the premise that people should interact with computers through a “command line.” First the person does something, usually either by typing or clicking with a pointing device. And then, after an unspecified period of time, the computer does something, and then the cycle is repeated. That is how the Web works, and how everything works these days, because everything is based on those damned Linux servers. Even video games, which have a gloss of continuous movement, are based on an underlying logic that reflects the command line.

Human cognition has been finely tuned in the deep time of evolution for continuous interaction with the world. Demoting the importance of timing is therefore a way of demoting all of human cognition and physicality except for the most abstract and least ambiguous aspects of language, the one thing we can do which is partially tolerant of timing uncertainty. It is only barely possible, but endlessly glitchy and compromising, to build Virtual Reality or other intimate conceptions of digital instrumentation (meaning those connected with the human sensory motor loop rather than abstractions mediated by language) using architectures like UNIX or Linux. But the horrible, limiting ideas of command line systems are now locked-in. We may never know what might have been. Software is like the movie “Groundhog Day,” in which each day is the same. The passage of time is trivialized.

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But, as is often the case in space ranges, there is some very good stuff in here. The concept of the Antigora, i.e., a privately owned marketplace whose owner benefits both from its use by, and from the volunteer labor of, entrants is potentially quite useful.

I have a strong suspicion that Lanier’s use of Agora, and variations thereon, as his preferred term for one kind of marketplace and another, stems from the influence of the late Samuel Edward Konkin III (1947-2004), founder of a unique strain of California counter-cultural Libertarianism which he called Agorism, whose theories were promulgated via Sam’s own Agorist Institute. Potlatch metaphors were also a characterististic trope of Konkinian Libertarianism. One can hear the echo of Sam Konkin’s sunny optimism in the following analysis:

Perhaps it will turn out that India and China are vulnerable. Google and other Antigoras will increasingly lower the billing rates of help desks. Robots will probably start to work well just as China’s population is aging dramatically, in about twenty years. China and India might suddenly be out of work! Now we enter the endgame feared by the Luddites, in which technology becomes so efficient that there aren’t any more jobs for people.

But in this particular scenario, let’s say it also turns out to be true that even a person making a marginal income at the periphery of one of the Antigoras can survive, because the efficiencies make survival cheap. It’s 2025 in Cambodia, for instance, and you only make the equivalent of a buck a day, without health insurance, but the local Wal-Mart is cheaper every day and you can get a robot-designed robot to cut out your cancer for a quarter, so who cares? This is nothing but an extrapolation of the principle Wal-Mart is already demonstrating, according to some observers. Efficiencies concentrate wealth, and make the poor poorer by some relative measures, but their expenses are also brought down by the efficiencies.

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An amusing read and a fine provocation. John Perry Barlow, Eric S. Raymond, David Gelernter, and Glenn Reynolds will all be replying.

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Hat tip to Glenn Reynolds.

VoIP Watch is reporting rumors:

There are some rumors circulating that Steve Ballmer is about to step aside at Microsoft as its day to day operations head to make room for another president. Ken and I reported on this on KenRadio’s World Technology Roundup earlier today.

Bill Clinton.

Here’s what I know. Sources near Microsoft headquarters report that over the past few months the ex cigar smoking prexy has made trips to Microsoft headquarters and has been interviewing for the top slot as the company looks at ways to transform themselves for the future. Given the global implications of technology, having a leader that is an ex country president would be massive.

Why now? Well Ballmer has driven the company. His hard charging sales leadership style helped Microsoft during a time when that approach was needed. But Microsoft folks I’ve talked to admit those days are over and a new style is needed to be more change oriented.

Given Clinton’s global stature and statesman status just imagine the possibilities of what that would mean to Microsoft.

But this is only a rumor now, and no one at Microsoft would dare to comment on this one, so why bother asking…if true, you can say you read it here first.

UPDATE–Some readers and other sources say Bill’s visits to Redmond have had more to do with being on the Microsoft board than anything else…stay tuned.