Microsoft resigns from SIIA

In a move that wasn't entirely unexpected, Microsoft Corp. resigned from the Software and Information Industry Association (SIIA) yesterday. Microsoft's action followed the trade industry association's filing of a "friend of the court" brief against the software giant last month in the ongoing U.S. government's antitrust case.

In addition, Microsoft Chief Operating Officer Bob Herbold, who had been a member of SIIA's 19-person board, announced his resignation from the body's board.

Microsoft had been a member of SIIA for 14 years and paid the maximum dues of $125,000 per year, according to SIIA President Ken Wasch. The industry body has an annual budget of $8 million, Wasch said.

"If you're going to swim with the big fish, you can't complain when you get bit," Wasch said. "When our board of directors two years ago chose to get involved in the antitrust case, we discussed at length what the impact might be on our membership and influence. We recognized clearly at that time that we might lose members, including Microsoft, as a result of the position we were taking."

The SIIA filed its "friend of the court" brief last month on behalf of the U.S. Department of Justice, which, together with 19 U.S. states, is engaged in the final throes of an antitrust legal battle with Microsoft.

The SIIA brief agreed with the conclusions reached by U.S. District Court Judge Thomas Penfield Jackson in his findings of fact issued last November, in which he deemed the software giant to be a monopoly that had engaged in anticompetitive practices to the detriment of its industry rivals and consumers.

Microsoft spokesman Jim Cullinan denied that the SIIA filing is the prevailing reason for the software giant quitting the organization. "It's one example of the problems SIIA has been having. They've been so focused on this one issue rather than core issues like piracy, privacy and encryption," Cullinan said. "There's no leadership and vision at SIIA. They're just focused on going after one of their own members."

Wasch denied those charges. "It's absolutely not true that we've lost focus; all those allegations are false," he countered. "Microsoft is uninterested in anything SIIA is involved in with the exception of the (antitrust) competitive issue." He added that of SIIA's 45 staff, only one person is working on the antitrust issue.

Wasch described the relationship between SIIA and Microsoft as akin to that existing between the U.S. and China. "They're too important to ignore, but there are some differences that will not be resolved any time soon," he said. Cullinan said that analogy was "an indecipherable comparison."

Cullinan said Microsoft had spent the past two years trying to work with the industry group to get it to focus on issues aside from the antitrust lawsuit, pointing out that other IT heavyweights have also quit SIIA, including Intel Corp. and Network Associates Inc.

Wasch replied that Intel left the organization two years ago and that it's typical for companies to come and go from a trade group. SIIA still has 1,200 members.

"Our board of directors includes representatives from Reuters, Dow Jones, McGraw Hill, Sun, Oracle, PeachTree Software and Digital River," he said.

Now that Microsoft has quit SIIA, the company is better positioned to work with other industry organizations, notably the Business Software Alliance, an antipiracy group; the Computing Technology Industry Association; and the Information Technology Association of America, Cullinan said. He castigated SIIA as "not being an effective representative for the (IT) industry," pointing to open positions within the organization and dwindling attendance at SIIA meetings.

Wasch acknowledged that the body has had some personnel issues to deal with resulting from the closure of its merger with another industry organization, but he said those issues have now been sorted out. SIIA was formed on Jan. 1, 1999, when the Software Publishers Association and the Information Industry Association agreed to merge (see story).

When questioned on the timing of Microsoft's announcement, an industry source who asked to remain anonymous said Herbold last week raised some questions about SIIA's legal status resulting from the apparent nonfiling of some documents. "Microsoft was just trying to get the SIIA, trying to find some dirt on the organization," the source said. "It was a purely administrative thing and was corrected today."

Complete Computerworld coverage of Microsoft's legal battles
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