Resolve and Fortitude : Microsoft's ''SECRET POWER BROKER'' breaks his silence by Joachim Kempin Page A

been the most glaring sign that we were no longer in sync! IBM did not have to wait until then. In March of ’90, Paul Maritz, in command of OS/2 development, stopped sending her the newest code, effectively and to her utter dismay, immediately unraveling the partnership. IBM’s newly demanded and far-reaching design changes were to blame. Our customers applauded. Working out the separation details took time, but at last, in the fall of ’90, our divorce papers were signed.
    I was jubilant. The divorce afforded a golden opportunity to transfer the IBM business responsibility to my group. When it happened, IBM no longer enjoyed the darling client status she had basked in for over a decade. No longer being primus inter pares , her future royalties would from now on be strictly based on expected unit sales. I made sure of that!
    Steve took the split much harder. First of all, he viewed the divorce as his own personal failure, and in addition, he felt scorned. Never mincing words, he declared IBM was, from now on, MS’s enemy number one. “I hate that company!” The second OS war was about to begin before the one with DRI had been concluded.
    Bill worried if we could really win that new war. Lots of execs, including me, told him confidently we would prevail. IBM had zero support from other OEMs, and the software community trusted and followed us for now. Could IBM, with all her vast resources, buy all the favors needed to win? If market participants would behave like paid-off Lotus, maybe!
    Not sharing my optimism, Bill looked at the bigger picture. What bugged him most was that Big Blue was turning out more patents than all other computer hardware and software companies combined. Patents are easy to inadvertently infringe upon. He knew they constitute the ultimate monopoly. IBM’s merciless and ruthless enforcement policies made her patent portfolio a nasty entity to fight against. We were experiencing the reality of such contest thanks to a lawsuit Apple had recently filed against us in regard to Windows. With IBM, we had entered into a five-year cross-patent agreement, obligating us to pay an annual $1 million for patent peace. Nobody could predict what would happen when it ran out.
    Another of Bill’s considerations was IBM’s huge market power considering her dominant position with enterprise customers and the resulting mainframe choke point it had created. Would she use this, unhinge us, and make winning the enterprise battle for Windows unfeasible? I’ll admit that upsetting a supergiant like IBM was scary. We would need perfect execution to win and Bill knew this was historically not our strength. Despite the breakup, he explicitly told me that he wanted peace, not war, with IBM, and he refused to give up on his wishes. Steve, on the other hand, would have loved to slowly strangle Big Blue—not that he could have succeeded single-handedly. His message to IBM’s management: “Bring it on!” His message to me: “Win and obliterate OS/2!”
    It takes two to tango and to keep the peace. As we were trapped in customer commitments, our newly acquired foe was a considerable force to reckon with. IBM’s then president Jack Kuehler personally spearheaded the attempt to gain an upper hand. His motivation was twofold. His aspiration: not letting IBM’s customers down and wrestling the lucrative OS business away from us. The result was a brutal and bloody war staged with full force for six years—in the marketplace and in the courts of the land.

TURBULENCE
    ÉTUDE IN F-MOLL
    In March of ’90, I visited CeBIT, the largest computer-technology trade show in the world. Adding to the allure was that the event was held in Hannover, Germany, my hometown. I had lived there for thirty years and, as a student, often worked at the fair, doing a variety of odd jobs.
    I was first to meet with Theo Lieven, Vobis CEO. The upcoming release of Windows version 3.0 had made him finally come around. Unfailingly opportunistic, he