Once More unto the Breach

OSBC Keynote Competition between Sun, Microsoft, and IBM — IBM Won

I continue to stand in awe of IBM's ability to market. Here's how the line-up of executive keynotes went down this morning at OSBC.

First up was Jonathon Schwarz, Sun CEO. Jonathon always gives good presentations, although he seemed a little brittle this morning. His messages this morning:

• It's all about the cloud.
• We are it.
• It's still about business.
• [Please] buy our hardware.

Microsoft stepped in with Robert Youngjohns, President of Microsoft North America. An excellent soft speaker that quickly established his historical geek credentials and breadth of technology interests beyond Microsoft tech. He apparently even worked at both Sun and IBM. His messages this morning:

• It's all about interoperability.
• We get it [finally].
• It's still about business.
• [Please] buy our software.

Robert Sutor, IBM VP of Open Source and Linux, then finished with a virtuoso performance. It was about collective action. His messages this morning:

• It's all about open source and open standards.
• Linux is an amazing mature flexible solution for the world's information processing problems. "It's not a hammer, but a collection of fine tools." Our involvement in the Linux community is ten years old.
• It's NOT about business. It's about solving hard problems. [A nice paraphrase of Drucker's the purpose of a company is not to make money.]
• We [collectively] have the tools to solve these problems. We [IBM] can help you.

I think the only time he actually mentioned IBM was when he said in passing that they had broken the petaflop barrier last year. It was masterful. It was designed to remind you that IBM has depth of technology experience, and the tools (people, hardware, software, knowledge) to help you with your information management problems. It was a conversation starter between the company and customers. It wasn't about selling technology but rather tailoring solutions — just tell us what you need.

It doesn't matter what you think about each company. Good executive keynotes are performance art delivering a marketing message. (Bad executive keynotes are product announcements to audiences that paid good money to learn something other than the latest thing they're going to be forced to buy.) While all three presenters today are consummate performers, one message was about solving problems, the other two about selling stuff.

Long after Sun's been cut up for parts the way DEC was, and long after Msft stops trading, IBM will still be humming along as a technology solutions company with a mixed-margin portfolio offering, terrifying as that might seem for some. Well done, Bob.

Does Your Community Manager Report to Engineering or Marketing?

I asked a question during Matt Aslett's excellent presentation on Monday at the Microsft/SD Forum OSBC Zero Day event: Does your community manager report to engineering or marketing? Matt gently stepped out of the way, but there is exactly one right answer: Engineering.

Here's why:

Community is concerned with the software project and it's complementary assets. Customers care about buying product solutions to their problems.

Engineering cares about software development. Marketing cares about product lead generation and qualification.

Engineers manage software. Marketing manages messages and expectations.

This doesn't mean that the community isn't an enormous source of word-of-mouth evangelism for the company, the project brand, and self-qualified leads over time. But the community doesn't want messages and they don't want to be qualified or converted. The community is already setting their own expectations around the project instead of buying the product. Neither does this mean that marketing is out of the loop at developing inbound requirements from customers for the engineering team as they develop the software that feeds into the product.

While marketing traditionally managed the "developer network" in closed source companies, that's because the software wasn't a community engagement mechanism for users that weren't customers. Growing the developer community around your platform was a marketing function based on the business strategy of growing market share and providing complement value with lots of "knowledgeable developers" for customers. The software part of the solution wasn't a source of customer contribution, innovation, and testing resource. Your community equated to your customers.

There are companies that historically have strong product management departments that are often staffed by engineers that have crossed the floor to marketing. There's still a problem here with the community manager reporting to marketing, because the marketing department is traditionally measured on marketing functions. They will behave against how they're measured.

So community development and management is an engineering function.

More on Open Source Conversion Rate Myths

A year ago I posted on open source business practices and conversion rate myths. A colleague asked yesterday whether we shouldn't still use it as a measure until a better one is found, since it's the best we have.

The problem isn't that it's a poor measure, but I believe it's a wrong and misleading measure. It is NOT similar to lines-of-code in software engineering (a poor measure). Variation in LoC is still within a few percentage points when you resolve for the project differences. Conversion rate is orders of magnitude different between companies. Business measures are typically within percentage points. Think of ratios like gross margin. They vary between types of businesses by as much as 30% but within an industry they're pretty steady and act as a benchmark.

Using a wrong or misleading measure will put you in jeopardy if you're the marketing or community manager. (You're being judged against the metric.) If you distribute for "free" as open source software, you capture your user base depending upon how good you are at getting the word passed onward. If you're good, you build community around your software. Remember software only forms part of the value network that is your solution — and customers buy solutions to problems. Mårten Mickos well observed that your early community is willing to trade time to save money and your later community is willing to trade money to save time — and the later community contains his customers. The observation implies a timeline for community growth depending upon the software project. Companies starting a business around a new project need to be sensitive to this. Customers (people that are going to buy something) will use free access to test that your software might solve their problem before they pay for your solution.

Many users in community do not have money to spend today. They can't be converted. As a "lead" they will never become a "qualified" lead, and getting in their way trying to sell to them will only be a source of frustration for everyone involved. BUT while in a normal proprietary software company this means you've disqualified someone that isn't a customer in the pipeline, in the open source corporate world, I believe they sit in a different process. Instead of a manufacturing metaphor (pipelines) we need a more organic social metaphor to track success and growth of the community. Lead generation is a measure of community engagement. You want to grow your community. Customers will self-qualify.

This WILL be reflected in a number of downloads, but this is correlative not causal, and it's an ambiguous metric. It's very software function dependent. If a user downloads one copy and installs it on a hundred machines, your knowledge is already off by two orders of magnitude — counting downloads is useless.

The greater user community still needs care and feeding because they contribute code, bugs, time to answer one another's questions, beta bodies, and interesting applications of your software you may not have thought about or had time to develop yet. They are a source of innovation, not simply within the software (small contributions) but at the solution level. They will tell your BUSINESS new places to go to capture money in the network around your software. These are very valuable people. Growing your community is important for this reason. Don't simply measure downloads and compare to a number of customers. Measure everything you can think of about your community:

• Unique members on the forums.
• Time to answer a question (internally versus community). [And don't reward your employees for answering quickly or your community will never get a chance to answer.]
• Number of code contributions.
• Number of bug reports.
• Number of documentation contributions (howto, tutorials, etc.)
• Feature requests.
• etc.

For numbers that tie back to specific releases of software, use them to tune your engineering process, i.e. involve your users in your engineering process. Consider letting USERS vote on importance of bugs so they feel a part of the process. (Don't draw the line between customers and users. It will be tempting, but customers probably buy something else from you in their solution. Disenfranchising users is disenfranchising the larger community of interest and probably a false feature.) Engage their time (appropriately) and you will win community mind share. Mind share is everything for profitability. It's the stickiness. It will create customer advocates.

There will come a time when the users move to other organizations bringing their knowledge with them and the new organization will self-qualify to become a customer. Or the user's own company grows to a point that they become customers. But they don't "convert" in the traditional sense. The lead did not become a qualified lead and you don't need to "sell" to them to convince them to buy your solution. They have internal needs that makes buying your solution more important than using your software. I'm betting those internal needs are very function-centric (e.g. one company will buy JBoss support while using RHAS for free). Determining those functional decisions in relation to your solutions will give you better insight into how to grow your customer base, i.e. revenues, without sacrificing your community in "conversion" games.

This comic is licensed under a Creative Commons Attribution-NonCommercial 2.5 License from xkcd.org.

InitMarketing TV Launch with Bruce Perens Video

The first videos are up on InitMarketing.tv. Sandro interviews Bruce Perens in the kick-off video with fun commentary on open source software and the long-tail. There are also interviews with Oliver Nachtrab from Open-Xchange and Florian Effenberger from OpenOffice.org. There's an RSS feed for the site, and Sandro has interviews in the pipeline with Andrew Rodaway (Director of Marketing, Canonical), Fabrizio Capobianco (CEO, Funambol), Shane Martin Coughlan (FTF Coordinator, Free Software Foundation Europe), Stormy Peters (Executive Director, Gnome Foundation), Boris Kraft (CTO, Magnolia), and more. Enjoy!

Building an Effective Commercial Open Source Strategy

Initmarketing partners Sandro Groganz and Roberto Galoppini taught a day long workshop entitled "Building an Effective Commercial Open Source Strategy" in Berlin at the Open Source in Mobile conference. I was unfortunately unable to attend (and I love Berlin), but I contributed to the materials. It is essentially our combined experience and expertise wrapped up into a one day how-to seminar.

Roberto has posted a great summary of his presentation on his blog.

Would you do Open Source Marketing for Microsoft?

[Updated 2008-02-14, 20:15] Sandro also posted on the subject.

Microsoft’s partners team through its NXT initiative launched a campaign focused on open source ISVs in 2007 in conjunction with the Open Source Business Conference.  The campaign is designed to encourage ISVs to explore how best to deliver their solutions to customers in the Microsoft world, recognizing that many high profile open source projects have 30%-50% of their installed base in the Windows world.   The Microsoft program works through partners to assist ISVs.  

In the open source campaign, the NXT partner works with the ISV to:

• Review the ISV’s business model, solution offering, and channel delivery plans.
• Determine the best approach and plan to expand business in the Windows marketplace. 
• Map Microsoft partner programs that best serve the ISV to their needs.

Microsoft wants to expand the program this year, and Sandro Groganz and I are considering working together to join the program as a partner through his company.  

Sandro set up InitMarketing as a consultancy that develops marketing strategy for companies that use open source software in their solutions to customers.  Sandro’s executive experience at eZ Systems and Mindquarry and as a PHP developer serve him well here.  I’ve done strategy work for and with a number of open source related companies, built a product that used a breadth of open source software covered by a variety of licenses, and spent five years at Microsoft so have some understanding of the organization and its culture.   

As Sandro and I investigate the program, we are not without our misgivings.  Do a search for “open source” on the main Microsoft partner site and you discover mostly anti-open source competitive material in the initial search results.  Do the same search on the NXT partner site and you see a set of open source friendly case studies. (I’ve blogged elsewhere about the Microsoft message conflict problems.) And non-IE browsers don’t always render the site well.  And some parts of the partner world want you to install Silverlight “[i]n order to view the rich media content on this page ....”  None of this is encouraging to the average ISV living in an open source world.  

But this is also our opportunity.  The Microsoft programs were developed out of a culture of “open source equals Linux” and anti-Linux competitive work and sometimes reflect that history.  The NXT program is working to recognize the economic reality of the wealth of free and open source software running in the Windows world today.  We have an opportunity to open the discussion with the ISV team about what open source software actually means on the platform.  We have the opportunity to inform the business to mutual benefit.  

Sandro and I believe that we can start a more transparent discussion with Microsoft’s ISV team, starting here and now.  We’re excited at that opportunity. The ISV and open source teams at Microsoft are open to this discussion. We’re curious what the rest of our readers in our business community think.  Please share your thoughts below.  

Microsoft Partnerships, Open Source Software ISVs, and Culture and History

Last week, Mary Jo Foley offered commentary on Microsoft's open source software strategy with respect to independent software vendors based on an interview with Microsoft's Sam Ramji. Matt Asay provides good colour commentary on his blog. Each post focuses on the trustworthiness and competitive history of the company. Let's look at things from a different perspective.

First, if you sell software solutions, and one of the platforms you support is Windows, you're not alone. There is a lot of free and open source software that has company support that is deployed on Windows as one of its platforms. The "big" free and open source software names include:

JBoss: Claimed 50% deployment on Windows when they signed a partnership deal with Microsoft that included technical collaboration in September 2005.

SugarCRM: Claimed 35% deployment on Windows when they signed their technical collaboration deal with Microsoft in February 2006.

Eclipse: Several studies have been done over the past few years show Windows adoption for development and deployment (Dev/Dep):

(80%/60%) [Evans Data Corp., September 2006]
(62%/37%) [Evans Data Corp., September 2007]
(74%/47%) [IDC, Summer 2007]

While Eclipse itself isn't a company, many ISVs build businesses around the Eclipse project.

Alfresco: Claims 30% deployment on Windows according to their internal study published June 2007.

MySQL: Claims 40% download MySQL for Windows.

If Windows is one of the platforms you support, there should be nothing stopping you from considering joining a Microsoft ISV partner program. They provide lots of material and information to make it easier to develop, market, and sell on Windows than doing it all on your own. It absolutely benefits their growth. It benefits yours as well.

To provide the best possible experience for your customers, if the Windows version of your applications needs to use Active Directory, Microsoft Operations Manager, or any other Microsoft specific technology, then I'm going to assume you'll best serve your customers and architect the application accordingly for multi-platform development, deployment and support. We have been architecting applications to support multiple platforms for decades, and it's easier today with common tools and languages (most of them open source), and standards support across platforms. Again, better to join a Microsoft ISV program and cheaply get access to the best technical information possible for the platform to support your customers.

Some consider "doing business with Microsoft" tainted. There is no excuse for the behaviour we all saw from Microsoft with Netscape, or Sun with Java. If not for the high profile of the last U.S. Department of Justice investigation, the preponderance of email, and the ease with which one can search it, we wouldn't have such wonderfully embarrassing email examples that demonstrate how some people inside Microsoft think. (It makes you wonder what embarrassing gems are sitting in the email queues of other companies that haven't had this level of public legal scrutiny.) But most companies aren't in a position to demand their customers shift platforms. Even MySQL AB supported the SCO Openserver platform better to support customers.

[Contrary to popular belief, Microsoft didn't eat all its original ISV chain out of a rapacious need for growth. Customers demanded Microsoft provide a lot of tool support directly to simplify their development and procurement needs as the platform became ubiquitous.]

There are several things to understand about partnering with Microsoft that have a lot to do with the history and culture of the company. Microsoft was the PC software company, i.e. Microsoft customers had enormous deployments of small footprint inexpensive machines, versus the big server company (1990s) with far fewer big-iron multi-processor machines, versus the mini-computer company (1980s) with fewer less powerful systems, versus the mainframe company (1970s) with fewer still very large machines. While today a company will rack out thousands of blade servers in their back-room big-iron environment, in the 1980s and 1990s they didn't.

Microsoft developed programs throughout their channel sales and marketing organizations to enable them to scale their growth. Their margins were completely different from the other large software companies (e.g. SAP, Oracle) or UNIX OEMs. So a VMS or UNIX ISV may have seen OEM staff arrive on site to help migrate or tune an application to the platform because of the margins involved in that business, but Microsoft had to create a program to enable their DOS then early Windows ISVs to get access to expertise differently. Starting an ISV that developed PC-related software required a far smaller capital outlay and so there were a lot of such companies. Programs like MSDN were created. The ISV programs were by definition information-intense but engagement-soft. It was the smartest way to correctly serve both their ISV partners and their business model.

Hardware, software, and the Internet evolved. Windows became Windows NT has become Windows Vista and Server growing into the data centre. The big iron UNIX server world is evolving into scaled arrays of Linux servers. While these worlds collide in the data centre, the financial success of Microsoft remains tied to a culture of scaled programs. If you're an ISV that is used to the way IBM, Sun, or HP treat you, you may be surprised by a Microsoft program's lack of personal engagement.

There's another cultural practice that contributed to Microsoft's growth and success through the 1990s and that effects partner programs (and customers alike). Employees were allowed, indeed encouraged, to regularly shift positions within the company. In the early days it kept smart people that might be prone to boredom fresh and ensured culture wasn't lost through the employee leaving the company. That practice is still considered a strength today. Scale-out programs (not tied to specific people or relationships) supported this model.

But it means that any relationships built with the Microsoft by an ISV will likely change regularly. You're going to need patience and regular contact to follow-up with the program people you do meet, and [hopefully] get quick early warning when that person is about to change. You're also going to need determination to be the squeaky persistent wheel. You may be one US$10M/year company clamouring for attention from a Microsoft employee drowning on 150+ emails a day who is responsible for a program with 100 companies like you. Managing the relationship to continue to get attention requires perseverance. If you can grow your business better through a technical partnership similar to the Zend PHP relationship, you will need to be prepared for a very focused meeting because you'll likely get one shot to get the point across. (Hint: Start with the punchline then keep things short and direct.)

In the end, do what makes sense for your customers. Join the Microsoft ISV program if it makes business sense. Use the materials that help your business grow and ignore the rest. Do it with your eyes wide open and your expectations set. Best of luck!

Open Source Business Practices and Conversion Rate Myths

[Update: 3 March 2009, 12:13] Added some more ideas here.

With the Sun Microsystem recent move to acquire MySQL AB, open source business models will be a topic of much discussion again. MySQL AB, like Red Hat, has always been one of the examples everyone points to for how an open source business should be run. One of the oft quoted statistics of the MySQL business is "one customer for every thousand users". This number is then quickly put into context as "probably too big" because MySQL is available in so many places that trying to count downloads and users becomes impossible. When JBoss was acquired by Red Hat, the publicly acknowledged conversion rates were 3% (JBoss) and 10% (Red Hat). People start making assumptions about business models based on driving downloads and user community size. And that's where the problem starts.

That's an order of magnitude difference. In a bricks-and-mortar world, business differences measured in a few percentage points are spectacular when comparing company ratios. In a digital world, where the cost of goods sold and marginal cost differences change, it doesn't seem right that we would be seeing orders of magnitude differences between companies for this type of ratio.

I participated in a recent informal (qualitative) survey around purchased support for Linux systems. [It was definitely NOT quantitatively or statistically significant. But anecdotal evidence can be interesting.] In operations of 100 servers or fewer, no one even considered buying support from their vendor for ANY of the servers. In operations of greater than 1000 servers, no one questioned buying support for ALL of their servers. Even "small" operations of 100 servers were still mission critical.

Somewhere in the order of magnitude difference in the server farm size, buying priorities change IT budget allocations. Maybe it has something to do with relative percentages of the budget spent on hardware/software/support versus headcount/expertise. Or with the cost of downtime to the business for a particular application environment. (A friend with a "small" server farm of ~100 servers told me recently they didn't hesitate to pay for JBoss support while migrating a critical application from a BEA Weblogic environment, but didn't consider paying support on the Linux servers themselves.) Or maybe it has something to do with the relative margins of the business. But I'm pretty sure the change in buying habit has more to do with the customers' business needs than the vendors' distribution practices.

Regular readers of this blog have heard me rail against the idea that open source is some sort of different business model. (Again, I'm not talking about collaborative software development in community here, but rather businesses that use such software.) It's definitely an area we need to go think about some more, figuring which software business ratios are significant and which practices to encourage.

MySQL and Sun

Sun Microsystems wants to acquire MySQL AB for US$1Billion. Stephen O'Grady (Redmonk) posted his always excellent deal analysis on his blog. I would urge you to have a read. (It also is a great collection of the relevant URLs.) I'll fit a few extra observations around it. Jonathan's blog post sets the tone for Sun, while Zack's post sets the MySQL perspective straight. But first, congratulations to Monty Widenius and David Axmark for their original vision, and to Mårten Mickos, Zack Urlocker, and Brian Aker and the rest of the team that has built so much value into MySQL AB. Congratulations also to Sun for having the vision to acquire MySQL.

Christensen is the first to point out in his presentations that what he originally called “disruptive technology” in The Innovator’s Dilemma was later observed to be a “disruptive business model” by Andy Grove during a presentation at Intel. (The book had already gone to print, and so we now have loads of technology companies running around thinking their technology is more important than their business models.)

Christensen models demonstrate that a disruptive business model generally begins with an inexpensive “inferior” technology offered at a lower price in a different margin business model that enables customers either to do something they’ve never been able to do or to avoid the expensive control point. The “inferior” technology matures as the business grows and eventually the business grows into mature markets (i.e. the business model is disruptive). Think Linux from undergraduate project in 1991 to the IBM and Red Hat/MSDW Wall Street keynotes at LinuxWorld in 2002. So too with MySQL.

Oracle hammered away at the message that MySQL was missing key features high-end relational databases needed to support mission critical applications. But MySQL is the Web’s database. It was created with a different vision and goal in mind, and enabled an entirely new group of customers to make it the “M” in LAMP. It is gaining the features needed to eventually allow it to be an Oracle replacement, but that isn’t the goal today, nor has it been the business model. This means that any way Oracle executives try to measure the database (transactions, scale out, etc.) or the company (units, revenue, etc.) will leave them scratching their heads. To Oracle’s credit, they quickly understood that it isn’t that MySQL is free or open source software that’s their [future] problem but the business models around it that are disquieting, and so adjust their rhetoric accordingly.

I raised questions about cultural mixing when Red Hat acquired JBoss, but I think it is less critical this time or rather my questions about the processes and values with respect to customers will be less of an issue. MySQL should be a separate enough line of business for the foreseeable future.

I think Stephen’s analysis from the Sun angle is perfect. Sun continues to evolve its solution to customers to enable it to be the heart of the Web. Owning a word in the customer’s mind is the pinnacle of marketing excellence. But complex network computing solutions aren’t quite as simple as “Kleenex”, “Xerox” or “Escalator”.

IBM evolved to be a company that offered their customers all the technology choice AND the expertise to knit it together into a coherent unique customized solution. It doesn’t matter how imperfectly true that statement may or may not be -- but rather what customers perceive it to be. That doesn’t mean IBM isn’t happy to push an IBM-centric technology agenda, but it’s the customer relationship that’s important (since they’re the people with the money and the choice) and IBM focuses on ensuring they have the breadth of product offering to best map their customers’ self-selected heterogeneous needs. They are no longer the “Selectric” company and have even evolved with the networked IT world to be more than the “mainframe” company. IBM continues to build their message around open systems, standards, and open source, which suits their customer’s heterogeneous decisions. IBM is the “data center” company.

Sun is also evolving its message and its offerings to suit their customers heterogeneous web-based applications needs. They’re building relationships with IBM, Microsoft, the Linux community, and now they’re acquiring MySQL. Sun is in a position to deliver a heterogeneous technology base to their customers’ heterogeneous needs and to shape a marketing message that began as technology slogans around “the network is the computer” and “the dot in Dot Com” into a customer centric idea like the “Web” company. That doesn’t mean they won’t meet severe competition from IBM for which idea word is more important in customers’ minds, but they’re still in the game after being counted out too many times in the past.

(Mis-)Reporting Microsoft and the EU

PR is a wonderful thing.  The PR surrounding the EU decision on Microsoft begins with Microsoft gracefully accepting the court's ruling in a press release.

Well said!  Indeed, masterfully said.  Humble.  Conciliatory.  Quick to point out how the industry has changed.  Quick to point out the expanded investment in Europe.  Now let's look at the positioning.

The PR machine actually started the day before the announcement in the Financial Times ("Microsoft says rivals may rue siding with EU") with:

"Obviously, law that is made for Microsoft is going to apply to other market leaders as well. IBM, Google, Apple and others would have to look very carefully at the implications for their business models," — Brad Smith, Microsoft General Counsel

The New York Times started the week with "European Court Rejects Microsoft Antitrust Appeal".  The best quote:

“What this ruling will do is send a message to companies that if they establish a good market position with a successful product, they will be forced in Europe to essentially give up that product to their competitors.”  — Robert Kramer, a vice president of public policy for CompTIA, [a Microsoft ally]

The venerable Wall Street Journal further raises the spectre of anti-American sentiment under the banner "Microsoft Loss In Europe Raises American Fears", and picks up on the innovation thread with:

Microsoft's backers said the ruling will stifle innovation by making it tougher to design products with new features.

What utter PR-induced rubbish.  What is at question is NOT whether Microsoft is simply in a market leading position, or how they were shipping innovative features, but rather whether they abused a market dominant position with anti-competitive practices.  Here's how the EU actually describes a market dominant position in Article 82:

A dominant position is a situation of economic power held by a firm which allows it to hinder effective competition in the relevant market. It puts the firm in a position to exert considerable influence on the conditions in which competition is to develop, and to act without having to take that into account. ["Relevant Market" is defined here.]

One of the things that Article 82 goes on to discuss is "making the conclusion of contracts subject to acceptance by the other parties of supplementary obligations which have no connection with the subject matter of such contracts."  This would be something that U.S. Department of Justice followers might remember from the discussion around Microsoft OEM deals and bundling.  So the EU and the DoJ may not be as far apart as Thomas Barnett (U.S. DoJ) is quoted in the WSJ article.

Andy Updegrove's analysis is probably closer to reality.  Microsoft got off lightly here.  Just as US$100M in inbound litigation a year is the cost of doing business as a US$50B company, so to is this judgement.

While today's judgment is significant, it is worth noting that the penalties that Microsoft has incurred to date – roughly $1 billion, plus an obligation to reimburse a far smaller amount of legal fees – are minute in comparison to the magnitude of the profits it has garnered over the ten-year investigative period. During that time, its market share in both of the subject markets has grown dramatically. As a result, while Microsoft has nominally lost in court, it continues to win at the bottom line, given that the only impact on its products to date has been  more symbolic than effectual - the requirement to offer a version of Windows that does not bundle a free copy of its media player.

Stated another way, a billion dollars spread over ten years is $100 million a year.  During the same period, Microsoft revenues have grown enormously, to over $50 billion a year, fueled primarily by the continuing growth of its operating system and Office products.  It has been a tiny cost of business to pay, and a shrewd and cynical business decision to incur, a liability to pay one fifth of one percent of annual gross revenues to retain the freedom to dominate so lucrative a market in spite of the 2004 judgment.

It sort of puts all Mr. Smith's encouraging and friendly quotes about the growth of the Microsoft business over the past ten years in Europe into perspective.