WinInsider

Microsoft indicated on Friday that it is developing ways to become more flexible about how it prices its software in overseas markets.

For years, the software giant has clung to a one-rate pricing system in which it charges the same for its software whether purchased in the United States, Brazil or anywhere else. However, that effort has come under increased pressure as countries explore Linux as a lower-cost alternative for the government and for populations as a whole.

An industry standards group has made a preliminary decision to include Microsoft's video compression technology in a next-generation DVD format, giving the company a key boost in the digital media arena.

The steering committee for the DVD Forum on Friday announced provisional approval for Microsoft's VC-9 and two other video technologies--H.264 and MPEG-2--as mandatory for the HD-DVD video specification for playback devices. VC-9 is the reference title for the underlying video decoding technology within Windows Media Video 9. The approval is subject to several conditions, including an update in 60 days of licensing terms and conditions.

When Microsoft's top brass admit the company has done a less-than-stellar job of marketing its flagship operating system, something's got to give. Exactly what that "thing" will be is tough to pin down right now. Microsoft is weighing a number of options, ranging from new mechanisms to deliver functionality "out of band" before Longhorn ships, to an interim Windows release, a la Windows 95b or Windows 98 Second Edition.

A growing number of developers and customers said they would welcome such an interim release called by some "Shorthorn." Others said they would just be content for Microsoft to simply fix bugs and apply security features and hold off on another full version of Windows until Longhorn is rock-solid.

Microsoft is working on new initiatives that it plans to launch over the next few months that will help Windows to compete on a more level playing field with open source. So said Martin Taylor, Microsoft's general manager for platform strategy -- and the company's main point man on Linux -- during a Web cast for financial analysts, shareholders and other interested parties on Friday morning.

Taylor, who is the champion behind Microsoft's "Get the Facts" anti-Linux campaign, presented Microsoft's view of the competitive landscape on the desktop and server. He also answered call-in questions from analysts during his roughly hour-long presentation.

Microsoft claims the idea of an interim Windows release between Windows XP and Longhorn is just that: An idea. Nonetheless, such a release already has developers' and users' tongues wagging.

"Longhorn is looking more like a 2007 release," said one developer with tight Microsoft ties, who requested anonymity.

The developer said that the interim release is more than just a what-if. He said it is the resurrection of "Shorthorn," the Windows release that Microsoft was planning a couple of years ago as a stop-gap between XP and Longhorn.

Jim Allchin, Microsoft group vice president of platforms, in the manner of casual dinner conversation heard around the world, bypassed the company's normal protocol for product announcements on Thursday and revealed that there will be a new "Kit" from Microsoft, currently code-named Windows XP "Reloaded."

Officials at Microsoft are now scrambling to understand what the word "kit" means.

Jim, who is senior enough in the company to survive this ad-hoc product introduction, is evidently not taking calls. Microsoft's PR firm Waggener Edstrom wishes it had that choice, as it fields a firestorm of press calls that they weren't prepared to handle.

The British government says it is saving millions of pounds on software contracts through a willingness to go to the mat with companies such as Microsoft. Government departments are on track to save $186 million (100 million pounds) over three years through a combination of market intelligence and a more coordinated approach to licensing, according to a cross-party group of parliament members. Key to this has been hard bargaining with a reluctant Microsoft.

Mark Buckley, licensing marketing manager for Microsoft UK, said the company has always stood behind the value it gives its customers, but that it is always open to discussing contracts.

Microsoft WMV 9 Gets Nod for DVD HD
Microsoft's popular Windows Media Video 9 (WMV 9) format has been approved by the DVD Forum as a mandatory technology for any device seeking the DVD HD logo. That is, next-generation DVD players and other DVD playback devices must support WMV to get the logo. This is a huge coup for Microsoft, which is trying to get its video and audio formats accepted as industry standards, and for consumers, who will be able to purchase more advanced DVD movies in the future as a result.

Gates Tops Forbes List, but Buffet on His Heels
Microsoft's Bill Gates is still the richest man in the world ("Whew!" you're thinking, right?), worth $46.6 billion, but his buddy Warren Buffet is right on his heels, with $42.9 billion, and may soon surpass Gates. 8 of the top 10 billionaires are from the US, and 5 of them are from the Walton family, which owns Wal-Mart. Another Microsoft billionaire, co-founder Paul Allen, came in 5th place.

Bill Gates must be laughing his head off. Following a months-long investigation, the U.S. Justice Department on Thursday said that it would seek to block Oracle's hostile bid to acquire PeopleSoft, arguing that it would result in higher prices for technology, fewer choices and less innovation.

Setting aside the question of whether Uncle Sam has a case or not, Gates surely must be savoring the moment as Larry Ellison, one of the handmaidens to the Justice Department's antitrust lawsuit against Microsoft, is finally getting payback.

Shortly after the U.S. Department of Justice announced this afternoon that it will seek to block Oracle's $9.4 billion hostile takeover bid of PeopleSoft, Texas State Attorney General Greg Abbot said he and six other state attorneys general will join the Justice Department. The attorneys general from Hawaii, Maryland, Massachusetts, Minnesota, New York and North Dakota are also joining the suit.

The DOJ is filing a civil antitrust suit against Oracle today in San Francisco-a middle ground for Oracle, based in Redwood Shores, Calif., and PeopleSoft in Pleasanton, Calif.