The main concern is the economic power that is in the hands of an organization that owns the format in which the documents are held. If that company is Microsoft, what is to stop them holding their users to ransom by increasing the usage fees every year?

They wouldn't do that though, would they?

But they might just take their ball and go home...

From Reuters

"SEOUL, Oct 28 (Reuters) - Microsoft Corp. has threatened to withdraw its Windows software from South Korea if the country's antitrust agency orders it to unbundle its Instant Messenger and Media Player from the operating system.

South Korea's Fair Trade Commission (KFTC) has been investigating allegations that the world's top software maker breached antitrust laws by incorporating the services into Windows."

ODF is an open standard. Microsoft has the same opportunity as everybody else to use the standard. If they choose not to, that's fine, but the example of Korea shows why government agencies, entrusted with their citizens' information, would rather it wasn't held in a proprietary format.

Fellow Human

Pardon my ignorance. Can you explain the reason that Google will be a problem? And can you explain - in simple terms please - the reason that Microsoft will rapidly decline?

I do not understand any of this and will appreciate your clarification.

Many thanks
Kay

If "network effects" create a natural monopoly then why does some upstart open document format threaten the monopoly? Could it be that the monopoly was only ever going to be transitory? Could it be that there never was a natural monopoly, just a superior product? Maybe capitalism is a dynamic beast.

Perhaps I can help, Kay.

Microsoft makes its money from two major sources: the operating system that manages all the resources of the computer and enables the programs to work, and a suite of common programs (Word, spreadsheet etc) called Office.

Microsoft gained its monopoly by persuading all PC manufacturers to pay them a license fee for the operating system, whether or not they actually loaded it onto the machine. They also ensured that other office-type programs from their competitors - word processors, spreadsheet etc - would find it difficult to work with a Microsoft operating system.

(All this came out in evidence at the anti-trust trial a few years ago, by the way, and can be checked)

Once they had the monopoly, they were able to exploit the synergistic nature of the operating system and the Office programs to increase the resources they needed, so that you need to upgrade your PC every so often - and pay again for a new operating system, Office system etc.

Also, they were able to introduce new formats for their documents that obsoleted those that had gone before, once again requiring the PC owner to upgrade.

The advent of standards, which are basically free, and freely available to everyone to use, cuts across this synergy, and starts to break down the interdependencies that the company has relied upon in the past to ensure future revenues.

Hope this helps.

Pericles

Thank you very much for your post. Enlightening and interesting.

My husband says that I am very bright. I previously had an academic career. He says I lack a most important trait called common sense (I might add, he is not computer friendly)! I agree with him.

In 1985 I gained my first compputer. Universities said Apple was the go. I have worked in four unis across the Eastern State - all said Apple.

I moved out of academia. I still had my Apple in 2000. I could not wind my head around IBM at work. Finally purchased an IBM Melenioum 2000. I only use it for home stuff. I have not upgraded since then. My last technician visit was just about a year ago. He said that I have a good set up.

What do you think?

And why is Google going to go down the gurgler?

Many thanks
Kay

The words "Google positioning the search engine as the 2006 Operating system is another deadly danger" mean that Google represents a threat to Microsoft, not the consumer.

Google is healthy and the Search Engine market is an example of marketplace competition.