IBM's antitrust cage gets rattled
THE ANTITRUST KNIVES are out again, and this time IBM may be about to feel the cold stab of both European and American regulation as The Computer & Communications Industry Association (CCIA ) and a firm called T3 Technologies take the computing giant to task, and potentially to court.
The CCIA - whose members include the likes of Microsoft, Google, Oracle and AMD - has been on IBM's back for years now, arguing that Big Blue is indeed just a big bully which monopolises markets with its unfair behaviour and business practices. Did we mention who the CCIA members included, *cough*?
Piping up to add its voice to the "J'accuse", CCIA member T3 has separately filed a lawsuit in the federal court of New York on claims that IBM has total dominance over the mainframe market.
Now, for those who think mainframes sound a bit 90's, you would be sort of right, except for two things: the legacy transaction-based applications which still comprise about 80 per cent of corporate IT workloads, and the recent virtualisation and nebulous "cloud computing" hype.
Mainframes, it would seem, never really went away and are back on the forefront of strategic IT thinking. By offering hardware, software and services, IBM has long regarded the mainframe market as its cash cow, and rightfully so because it has dominated that segment literally forever.
But T3, which also develops mainframe technology compatible with IBM software for the SMB market, says IBM plays dirty by signing up enterprises that would have a very high cost of switching to other systems. The firm apparently also refuses to share blueprints necessary to offer a cheaper alternative.
"What they've done just isn't right," said T3's President, Steven Friedman, adding "if you want to buy a mainframe today, you have one choice in Europe and one in the US."
Microsoft, which has managed to dodge antitrust bullets matrix style for years, also chimed into the discussion, with a spokesvoles calling for "greater openness and choice" in the mainframe market. Excuse us while we choke.
Not that IBM made the situation any better by declaring it hadn't done anything wrong because "The IBM mainframe has been around for decades," and besides, "there have always been competitive options and alternatives to it." Just not particularly viable ones, eh? µ
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It's all about the money. T3 can't reproduce all the time and resources IBM put into developing its mainframe systems, so they just want IBM to give them the blueprints? What a crock.
There are still viable alternatives to IBM for large scale commercial applications.
Of course, given the current political "leadership" of U.S., don't be surprised if DOJ comes in on side of T3.
One bitter competitor trying to get IBM into trouble doesn't mean that they will win, nor that IBM has done anything wrong. Who had ever even heard of T3 before this? IBM's not in danger of getting into trouble.
Microsoft wants to do mainframes?
Heh, a conspiracy theorist might wonder about all this in the light of the past rulings and the upcoming ruling (against?) Microsoft, the ruling against Intel, and that they may well want the EC distracted away from them and their wrongs.
Yeah, I can see how the "current political 'leadership'" of the US hates big, well-established companies by the way they gave billions of dollars to GM.
And it's obvious they hate cartels and monopolies by the way the DoJ is dominated by appointed ex-RIAA lawyers.
Oh, wait. I follow your logic-- "I'm bitter because my guys aren't running the country. I'm against X. Therefore, the evil people in charge must love X." Makes perfect sense.
Stop being a right-wing tool and think for a change.
IBM went through anti-trust proceedings in the 60s or 70s. The results of which allowed other mainframe companies to run IBM's OS on their hardware. It also forced IBM to make available all the documentation (on their h/w & s/w that went between divisions) to their competitors. Something the anti-trust proceeding against M$ never got near doing.
As for competing products, what about Hitatchi, NEC, Bull, Fujitsu, or Unisys?
the main accusation in T3's complaint is that IBM violated anti-trust law by "tying" its mainframe software to its mainframe hardware. In layman's terms, that means IBM refuses to license its mainframe software separately from its mainframe hardware.
T3 says that this is a violation of anti-trust law because it harms competition. Specifically, T3 (and other would-be competitors) can't sell mainframe hardware because IBM won't license its mainframe software for use on non-IBM hardware. If customers have no OS to put on T3's mainframe hardware, the customers won't buy mainframes from T3. They will continue to buy from IBM.
This issue has come up before. Recently, in the Apple/Psystar litigation, Psystar accused Apple of tying its overpriced commodity x86 hardware to its Mac OS. You can't legally get the Mac OS unless you buy an Apple computer.
Psystar said Apple was using its software advantage in order to sell overpriced hardware, where Apple's computers are just commodity x86 machines, that are basically interchangeable with Dell or Gateway or Psystar boxes.
That litigation is still going on, but I think Psystar gave up its antitrust claims.
In i Data General v. Grumman /i , 36 F.3d 1147 (1st Cir. 1994), it was held that a company didn't need to license software that it developed in house for competitors to use to compete with it. However, that was diagnostic software, not an operating system.
The idea behind anti-trust law (that's been accepted by the Supreme Court for the past few decades) is that IBM should be able to get the benefit of its creativity (in making and maintaining a mainframe OS). IBM should be able to dominate the market for mainframe OS software if IBM makes the best mainframe OS. But IBM should not be able to use its dominance in the mainframe OS market to dominate the mainframe hardware market, as well.
I think T3 has a real chance if all it wants is the right to license IBM's OS. If, on the other hand, T3 wants details about IBM's architecture, that's going to be a lot harder for it to get. Maybe T3 would get the bare minimum of details of IBM's architecture in order for T3 to make its hardware compatible with the features of IBM's OS.
(Disclosure: I'm not a lawyer. This is not legal advice, it's just speculation about the state of IP law and antitrust.)
IBM has invested billions of dollars in making the mainframe what it is today. Protecting their investment in innovation & intellectual property is GOOD BUSINESS!
IBM would be glad to license their code, in most cases, as long as their rights are not infringed upon.
The only thing IBM has done wrong is allow people to build a business (as one dimensional as it might be) around selling hardware and software emulation for the mainframe (in many cases ISVs from their PWD program).
Shame on IBM for pulling the plug on T3T! Shame on T3T for building a one-dimensional business! We the ISVs got killed by this mess... The end-user will ultimately pay more in their software in the long-run!
T3 Technologies doesn't have a wikipedia page. That should show you how important they are in the world.