Second open letter from Apple

In the past few days, Intel and Microsoft said some remarkable things regarding the QuickTime lawsuit. I have better things to do than argue with them, but history shows that if you don't respond in public, people will assume you have nothing to say. And we do have several important things to say.

If you don't like this sort of wrangling between companies, my apologies, and by all means please move on to the next topic.

Intel's comments

I'll start with some notes on Intel's comments, and then discuss Microsoft. Here's a sampling of Intel's statements to the press, on two topics:

--How much code was pirated, and how easily could it be replaced?

San Jose Mercury-News: Howard High, a spokesman for Intel, said the code or software instruction in question was obtained from Canyon by Intel, but he characterizes it as "minor amount of code that we could reverse-engineer in a couple of weeks if necessary."

Boston Globe: At Intel, Spokesman John Thompson said: "As far as we're concerned, frankly, it's not enough lines of code to argue about, and we'll re-write it. We'll go re-engineer the code. It's a few weeks worth of work."

Wall Street Journal: An Intel spokesman said the disputed code is a small portion of Video for Windows that it will be easy to replace it with original code. "It's like three weeks of work," he said. "It's not worth arguing over in court."

Newsbytes: "There is certainly a lot of speculation here in the valley as to why such a big hubbub is made over something that is a relatively small, minor piece of code," said Intel's Howard High.


-Apple notified Intel about the pirated code several months ago. Since Intel could have replaced that code within a couple of weeks, we have to wonder why they didn't do so.

-Several thousand lines of QuickTime code were pirated. I'll let the reader decide how significant that is. We think it's important because the code in question greatly improved the performance of Video for Windows.

-By repeating over and over that only an insignificant amount of code was involved, Intel seems to be implying that pirating a small amount of code is not a big deal. I presume Intel competitors like AMD and Cyrix are taking notes here.

--Intel wanted to meet with Apple

Wall Street Journal: An Intel spokesman said the company was surprised by the suit, since it had been trying to discuss the matter with Apple.

Seattle Post: An Intel spokesman said the company was surprised but not concerned by its inclusion in the lawsuit... "We've been trying to set up a meeting with (Apple) to see what their concerns are."

Wash Post: Howard High, a spokesman for Intel, said the suit caught the company by surprise. "We've been trying to talk with Apple to understand what their issues are and try to resolve them."


-Apple had actually been in on and off discussions with Intel and Microsoft for two months, including a number of in-person meetings. The talks were not making progress. We've released a chronology of those conversations; speak up if you want to see it.

Microsoft's comments

Microsoft issued a press release late last week, and followed it up this week with several postings apparently written by Rick Segal, who identified himself as Manager of Developer Relations at Microsoft.

--Here are excerpts from the Microsoft press release:


Code Developed by Canyon Not in Windows 3.1, Windows for Workgroups 3.11 or Windows 95 REDMOND, Wash., Feb. 10 /PRNewswire/ -- Responding to the Apple Computer lawsuit filed yesterday, Microsoft Corporation said today that the code it licensed from Intel Corporation is not used in Windows(R) 3.1, Windows(R) for Workgroups 3.11 or Microsoft's yet-to-be-released operating system, Windows(R) 95.

Interesting that Microsoft doesn't mention Windows NT, and doesn't clarify whether the code will eventually be in Windows 95 when it's finished. According to Microsoft's own public statements, it has been Microsoft's intention to make Video for Windows part of both Windows NT and Windows 95. The following quote is from a recently published book entitled "Introducing Microsoft Windows 95--The Next Generation of Microsoft Windows". The author is listed as Brent Etherington and the Microsoft Windows 95 team. The foreword for the book is written by Brad Silverberg (Senior Vice President, Personal Systems Division, Microsoft). The book was published by Microsoft Press.

Page 252: "In the past, Video for Windows was distributed separately (principally as a Software Developers Kit), but with the release of Windows 95, Video for Windows is now built in to every copy of Microsoft Windows, including Windows NT. The widespread ability to play digital video has the following implications....

* The barriers to entry for would-be multimedia title and tool developers are further lowered because the issues of licensing and installing Microsoft Video for Windows disappear."

"The licensed code is low level driver code. It is not a key part of Video for Windows technology," said Brad Silverberg, Sr. Vice President of Microsoft's Personal Systems Division.

To quote again from "Introducing Microsoft Windows 95:"

Page 261: "In the summer of 1994, Microsoft released the new DCI display driver development kit. The DCI technology was developed in partnership with Intel and other makers of advanced video display cards.

"DCI is a device driver level interface that allows Windows to take advantage of the following hardware features when they are built into advanced display adapters [long feature list deleted].... Most of these hardware features relate to fast, efficient decompression and playback of digital video."

Sounds pretty important to me.

"For example, major performance improvements in Video for Windows were introduced in version 1.1c, which did not use or contain the licensed code. These performance improvements were carried forward into version 1.1d."

We contend that the Apple code increased the performance of VFW, not that this was the only performance improvement Microsoft ever made. We're confident that this will be clear when we get to court.

Since the filing of the suit against Canyon, Microsoft has repeatedly asked Apple for relevant facts in order to resolve this issue. Apple did not give Microsoft information about what specific code allegedly infringes Apple's rights, nor did Apple provide evidence to demonstrate its ownership or Microsoft's infringement.

Intel and Microsoft had access to the same information. We think we were pretty clear and gave sufficient detail. Intel understood us well enough to assess the code's importance and determine that it could be reverse-engineered in two to three weeks. That requires pretty specific knowledge.

We showed Microsoft one of the code files that had been pirated, to prove that our code was in VFW. We offered to share the rest of the source code if, based on the proof that we had already given, Microsoft would promise to remove our code. Microsoft refused. What would you do in this situation? Would you give Microsoft all of your source code when you were facing that sort of stonewalling?

"We are disappointed that Apple chose to go to court rather than provide Microsoft the information it sought," said William H. Neukom, Microsoft's Sr. Vice President for Law & Corporate Affairs.

Apple chose to go to court because we felt Intel and Microsoft were not negotiating in good faith.

You can see why.

--Now, here's the first note from Mr. Segal:

Date: 2/17/95 6:00 AM From: Rick Segal This is a copy of the letter that has gone out to our developers.... Dear Developer: You may have been confronted in recent days with incomplete information from Apple Computer Inc. concerning Microsofts Video for Windows (VFW) Software Developer Kit. I want you to know that Microsoft stands behind its products and the developers that use our SDKs to produce their own great products. Because of Apples aggressive PR campaign on this subject, it becomes necessary for us to clarify our position. Microsoft has only just received information to enable us to begin to evaluate Apples case against The San Francisco Canyon Company, Intel and Microsoft. Microsoft today told the court, "In light of Canyons 1993 assignment to Intel, there are serious questions regarding whether Apple in fact owns the code on which its claim is based." This and other fundamental facts are in question in the case.

So Microsoft denies that we own the code in question -- in spite of the sworn statement in which the Canyon programmer who wrote the code for Apple admitted that he gave that same code to Intel. This is why we had to sue.

if Apple files a lawsuit against you or any other developer for the distribution of VFW 1.1d, Microsoft will defend you.

Apple has no desire or plans to sue any developers. That's the whole reason for offering the amnesty program. Microsoft's brave offer is likely to raise more fears than it soothes, and we have to wonder if that was the intent.

--Here's a second posting by Mr. Segal:

Developers do not "need only" sign an agreement. What you are being told by Apple's marketing/pr machine is not what they are telling developers. Behind the scenes that switching is the only safe/sure way to avoid apple legal action.

A serious charge. Mr. Segal accuses Apple of lying, but doesn't give any documentation. If he would care to put on the record any of these alleged conversations, I'd like to see them. Better yet, perhaps developers could post some of Microsoft's conversations with them over the years. The readers could then decide which company is coercive and deceptive.

The question is not whether we're trying to get VFW developers to use QuickTime. They're already using part of it, and of course we'd like them to use the whole thing. We've been very up-front about that. But that isn't why we sued. We went to court to protect our rights.

For the record, the conditions of the amnesty agreement are exactly as we laid them out in the letter to developers. Nothing is hidden. It's not in Apple's interest to deceive or mistreat developers, which is why we went to the trouble of creating the amnesty program in the first place.

If anyone is confused about the terms of the amnesty program, they're welcome to post their questions here, and we'll answer them in public.

This is what this boils down to:

Your neighbor comes up and says your house is on my land, tear it down. You ask your neighbor for the facts, like where he thinks the property line is. All your neighbor does is say "well, you know I'm right, tear it down." The natural response is try and get some facts.

Wrong analogy. We never in this case tried to get Windows torn down. Here's a more accurate analogy: You catch someone selling furniture that was taken from your house. You ask them to stop. They refuse. They send you hostile letters. They use delaying tactics. They say the furniture isn't very large, so why are you upset anyway? After two months you get sick of it and sue. The next day they act surprised and claim you have refused to talk with them.

Facts are now coming out who really wrote it, when, and is this low level stuff even a problem in the first place given it is specific to two chip sets.

Now Microsoft adopts the Intel argument that this isn't an important issue because the pirated code wasn't significant. We think it was significant. Besides, piracy is piracy.

All Microsoft wanted was to sit down with Apple and work it out. Failing that, we moved to protect our development community while David Nagel sends out his marketing troops to scare the pants off developers.

David has my phone number as does Duncan and others at Apple. We would love to understand the issues and work something out. Apple doesn't want to do that. Fine, we will defend out positions.

There was plenty of detailed discussion. Besides, Microsoft and Apple began more than a month ago to negotiate this primarily through their lawyers. We have this on paper. So the whole "Dave Nagel refused to call me" routine is a sham because that wasn't the main channel of communications.

--Excerpts from some additional postings by Mr. Segal:

We are offering a complete legal blanket over this issue to developers so they can tell David Nagel and his band of marketing troopers to stuff it as they continue this, behind the scenes, attempt to strong arm developers into using QT....

Apple is lying about attempting to cooperate. They were asked tons of time for information. They simply would not work with us and they know it. At the CEO level, they were asked. We offered to cooperate. Spindler was telling us, oh sure, let's work it out, while his FUD machine was calling down our developers and using strong arm tactics for the sole purpose of getting people to switch to QT....

We will not, however, stand around and watch Nagel and his band of marketing drones use smear tactics, lie about facts, and threaten people with some bogus program that is full of holes.

I've seen the correspondence that went between Apple and Microsoft. I'm confident that when these issues are fully aired in court, it will be clear that Apple made a good faith effort to negotiate.

On a side topic, I'm relieved to say that I don't work for Dave Nagel (VP of AppleSoft, Apple's OS division), so I guess I'm not a drone FUD machine marketing trooper who produces bogus lying smear programs that are full of holes. ;-)

I do think it's very unfortunate that Microsoft's representative has chosen to personalize this thing. From our perspective, this is about legal rights, not personalities, and insults don't benefit anyone in the industry.

Michael Mace

Director, Mac Platform Marketing

Apple Computer, Inc.

Copyright 1995, Apple Computer, Inc.

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