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The problem that Microsoft is facing, is that the market for closed-source software is slowly dying. Fewer and fewer companies are prepared to risk their data to closed formats that, next week, when Microsoft issue a patch to fix the latest Outlook exploit, they somehow cannot read any more.
There is nothing new in the process by which free and open source software is gradually pushing closed source software out of favour. Consider the "big iron" of the 1960's. If you bought a computer then, it came with a special operating system, and a set of programs, designed and written by the manufacturer. It was considered impractical for the customer to write programs for these behemoths, and in many cases, the hardware was specially customised for specific clients.
Move on, now, to the late 1960's and the DEC minicomputers. Here were machines where everyone could have a time-sharing terminal, and write programs themselves (in Fortran, COBOL or many other languages, some still with us, some, like RATFOR, long gone). You still bought the OS and software from the manufacturer, but you could pay someone to write code for you, or write it yourself. This situation remained more-or-less unchanged for nearly 25 years.
The really big change took place in the mid-1990's, when public interest in the Internet really took off. Since nearly all of the Internet servers ran some sort of Unix-y operating system (Windows could barely do TCP/IP at this point, but that doesn't really matter), Unix conventions became the standard for the Internet. Ever wondered why it's not backslashes for directory trees in URLs? Linux was just an interesting student project, back then... Now nearly all the servers that make up the Internet as we know it run some variant of Unix, be it *BSD, Linux, Solaris, or any of the other really wierd and unusual ones. Windows is being pushed aside.
The situation is akin to the farrier of the last century. Imagine that you have a nice living shoeing horses for farms. Gradually, more and more people are turning to tractors and machinery, instead of horses and hand-steered ploughs. You have a choice. You can shoe the horses that are left until your children starve, or you can learn to fix tractors.
Times change. It's a shame that Microsoft cannot manage to adapt. Why should they be allowed to change and break laws to prop up their ailing business model?
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