Microsoft's top executives on Thursday detailed steps they say will help the software giant comply with antitrust legal requirements and operate more harmoniously in a world of interconnected software.
As previously reported, Microsoft announced that it will publish reams of documentation around its communication protocols to make it easier for third parties to connect to Microsoft products.
It also pledged not to sue open-source developers who create noncommercial software based on Microsoft's protocols.
These additional steps further formalize Microsoft's stated commitment to interoperability and recognize the changing technology landscape, said CEO Steve Ballmer, who hosted a teleconference with Chief Software Architect Ray Ozzie, General Counsel Brad Smith, and the senior vice president of Microsoft's Server and Tools division, Bob Muglia.
Executives said that the steps will help it comply with obligations dictated by the European Court of First Instance in September, as well as help Microsoft compete in a marketplace that increasingly values interconnected systems.
"In a more connected, services-oriented world...one of the greatest value-adds in some sense is what people do on the other end of the wire," Ballmer said.
He admitted that providing outside developers access to the same application programming interfaces that Microsoft engineers use--as Microsoft intends to do with Office 2007 by June--gives competitors a better leg up in some respects.
But opening up further lets third-party developers build products on top of popular Microsoft products, which ultimately benefits the company, he said.
"The combination of the changed environment, the new opportunities it presents for customers and developers adding value around us, there are risks that come with it. But we think, on balance, it's consistent with what we are doing anyway from a legal perspective, it's pro-customer, and net-net, it should add value for our shareholders," Ballmer said.
Ozzie made clear that the stepped-up commitment was a message aimed at Microsoft's own engineers who need to recognize that corporate data centers are a mix of different products and that end users care about sharing information more and more.
"This is a very important strategic shift in terms of how each and every engineer at the company views what their mission and job is," he said.
Microsoft executives did not specifically mention the Open Document Format standard, which is an alternative document format to Microsoft Office that is popular particularly with government customers concerned with long-term archives.
But they did say they will add APIs to Office 2007 to create add-ins for other document formats that will allow end users to save to another format by default. Often, the data that customers create outlasts the programs they were created in, which makes data portability increasingly important, Ozzie said.
In an interview, Microsoft's vice president of intellectual-property Horacio Gutierrez said Thursday's move was driven by a combination of regulatory requirements and "learning" that it had done regarding the commercial importance of interoperability.
He added that its covenant not to sue open-source developers makes a distinction between commercial and noncommercial software.
Companies that build products based on published Microsoft protocols will need to license patented Microsoft technology, similar to the way that Novell, Xandros, and other Linux vendors have done. Intellectual property will be available under reasonable and nondiscriminatory terms, and royalty fees will be low, Gutierrez said.
The moves were met with skepticism from traditional Microsoft antagonists.
The European Commission said that the announcement "does not relate to the question of whether or not Microsoft has been complying with E.U. rules in this area in the past," Reuters reported.
Lobbying group the European Committee for Interoperable Systems (ECIS) said "the world needs a permanent change from Microsoft's behavior, not just another announcement."
Michael Cunningham, general counsel of Linux distributor Red Hat, said that the announcement "appears carefully crafted to foreclose competition from the open source community" because it covenant not to sue only covers non-commercial open-source developers.
Others speculated that the timing of the move was meant to influence a vote later this month on whether Microsoft's Office Open XML format will be approved as a standard in an accelerated process.
Forrester Research analyst John Rymer said that he didn't anticipate dramatic changes in how Microsoft already operates, but the changes should improve product interoperability.
Specifically, Microsoft will need to document when it creates proprietary extensions to existing standards, something which has "driven people nuts" in the past, he said.
"When you rip this all apart, what we're seeing is Microsoft responding to market demand, to be more open and play better with others," Rymer said.
The moves are also an elevation within Microsoft of the work done by Microsoft's open-source and interoperability advocates, including Bill Hilf, general manager of platform strategy, and Sam Ramji, who is now director of open-source technology strategy.
Their work to appeal to open-source developers with documentation and the adoption of open-source practices has gone on even though CEO Ballmer has never appeared fully comfortable with the open-source movement and interoperability.
"This announcement is saying that the top executives see the value of the interoperability work they've done and that they're ready to institutionalize some of the principles they've been operating under," Rymer said.