Do SPA Guidelines Attack Microsoft?

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February 03, 1998 (12:00 AM EST)

By John Borland,

The Software Publishers Association (SPA) sparked a revolt in its ranks Tuesday, when it issued a new set of "competition principles" that critics said took direct aim at Microsoft's dominant role in the software market.

The set of eight guidelines serves as a position paper on antitrust issues for the SPA, which represents 1,200 software companies around the country, including Microsoft. "The principles we are releasing today represent our preliminary view of how a wide range of business practices affects vigorous competition in the software industry, both at home and abroad," said SPA president Ken Wasch. "The Justice Department and the Federal Trade Commission should consider these principles ... in developing policies that may apply to our industry."

But four member companies almost immediately attacked the principles, calling them a "thinly veiled slap" at Microsoft's success.

The critics cited no specifics, but several of the items resonated well with recent Department of Justice arguments against Redmond. "The operating system vendor should not include its own services or products as part of the operating system or user interface unless it gives the same ability to integrate products and services into the operating system to competing vendors," reads part of one principle. "Competition for the valuable 'virtual real estate' of the desktop should instead occur downstream in the distribution system."

The most vocal critic was ChiliSoft, a development company based in Bellevue, Washington. "ChiliSoft does not support the SPA's newfound role and its attack on Microsoft," said Mickey Friedman, the company's marketing vice president. "We do not feel it is appropriate for a neutral organization to take position in a matter of law and politics." ChiliSoft also announced it would withdraw from the SPA as a result of the guidelines' publication

Officials of Visio, based in Seattle, Wash., also took aim at the SPA's document. "The published principles are a thinly veiled slap at a single SPA member: Microsoft," said Ted Johnson, a Visio executive vice president. "The SPA should be representing the views of its membership on genuinely important industry issues like encryption and piracy, not positioning itself as judge and jury against one of its most successful members."

Seattle-based Mabry Software and New York's Sheridan Systems also joined in the criticism of SPA's document.

But SPA officials said they were not attacking Microsoft, rejecting the critics contention that the process of drafting the principles had been dominated by big Redmond rivals such as Novell, Netscape, and Oracle. "This is not a narrow group of Microsoft enemies," Wasch said. "The SPA does not wish to see Microsoft regulated, nor do we want to see Microsoft broken up."

As a member of the association's Government Affairs committee, Microsoft helped draft the guidelines, and supported six of the document's eight principles, Wasch said. But company officials criticized the remaining two, which were passed by a majority of the group's board members and Government Affairs committee members, he added.

More than three-quarters of SPA companies that returned a survey on the issue also supported a draft copy of principles, Wasch added. "It's very disappointing to be attacked by SPA's largest member for a process that was deliberative and open," he said.

The document's preamble says it aims to balance the rights of established software vendors to use the market power they have earned with the ability of newcomers to break into the market. The eight principles address concerns about third-party licensing practices, using operating systems to leverage unrelated products, OEM licensing, equal access to retail space, using operating systems to favor Internet content, and predatory pre-announcements.