The battle between Microsoft and America Online over instant messaging has continued over the last two weeks, with Microsoft releasing new working versions of its MSN Messenger software almost as soon as AOL can block it from their servers. The battle that all started with Microsoft releasing software compatible with AOL's Instant Messenger [see NewsSource, July 26] escalated when one of Microsoft's many re-releases caused a conflict with AIM, making it impossible for both programs to coexist on the same system. AOL fought back, disconnecting all MSNM users with a notice that they were using "unauthorized" software and suggesting the download of AIM.
In the way they usually operate, Microsoft blamed both the incompatibility and disconnections squarely on America Online's refusal to comply with "standards," a term Behemoth PR flacks only recently learned how to use for their own advantage. Microsoft's complaints about AOL worked well, even dividing the usually anti-Microsoft OpenSource community with some Linux evangelists calling for AOL to give up their fight. But most people overlooked how Microsoft wasn't even sticking to America Online's proprietary standards, making MSNM only partially compatible with the existing AIM service.
Far from giving up, America Online fought back with one of Microsoft's own tactics, enlisting the help of major software providers and ISPs to distribute their software. In less than a week's time, AOL made agreements to bundle branded versions of AIM with Internet service from MindSpring and EarthLink, then started working on integrating AIM with networking software from Apple Computer and IBM's Lotus subsidiary. That was the smartest thing AOL could have done, showing that they don't mind other companies using the AIM standards - so long as they do it the right way, instead of warping them the way Microsoft did.

COURT NOTES: Last week a USA Today report said the US Justice Department has recently contacted several investment banks and financial experts on the best way to split Microsoft apart. A DOJ official confirmed the reports, but wouldn't say exactly what they had discussed, only commenting that the antitrust case against The Behemoth is still waiting on a verdict, and that they haven't ruled out any potential punishment. According to antitrust law experts, it's standard practice for Justice to weigh all the viable remedies in advance of any major verdict.

Earlier this month Microsoft was actually encouraging illegal activity on the Internet, asking crackers to break into a site being served by a beta version of Windows 2000. The site, windows2000test.com, was encouraging users to "find the 'magic bullet' that will bring the system down" and "compromise an account; change something to which you should not have access; and get something you should not have."
The hacker/cracker community responded with a huge yawn, accusing Microsoft of using their skills to audit its own work and get free publicity. Then linuxppc.org set up its own crack challenge using a PowerPC-based server running Linux. Microsoft's only incentive for hacking was the satisfaction of hacking a Ms server, while LinuxPPC promised to give their server to the first person that could break into it. (That contest is still waiting for a winner.)
Apparently Microsoft's strategy to keep out potential crackers was to make the system unavailable to them - after a few hours of uptime the server went down and had to be rebooted, after which the site remained unstable. The problems continued throughout the week, with an eight hour outage last Wednesday night and intermittent problems until the weekend. Microsoft at first blamed the instability on "router trouble" related to a thunderstorm in the Seattle area, but the test site status logs said it was due to a "known bug." The eventual release of Windows 2000 could be detrimental to the cracker community, since it's impossible to break into servers that only run for 5 minutes at a time.

Like rats off a sinking ship, yet another of Microsoft's top executives is rumored to be departing the company. This time it appears to be developer group vice-president Paul Maritz, the man once considered Bill Gates' likely successor. In recent months Maritz has sold over $78 million of Microsoft stock holdings, and earlier this month stepped away from most of his duties inside The Behemoth, joining a group that advises Gates on the latest technology. A Microsoft representative confirmed that the 44 year-old executive has given up most of his responsibilites, but said he has not made any decisions about his future at the company.

A new security hole has been found in Office 97, again potentially allowing 'malicious' code to take over a user's system. The latest hole, discovered last week by developer Juan Cuartango, stems back to a problem in the Jet data access engine included with Office 97. According to Cuartango, the hole permits code contained in an Excel spreadsheet, e-mail or a Web page to take over entire systems and read or delete files. A Microsoft security expert confirmed the problem, and said that an upgrade to version 4.0 of the data jet should correct any security risk. The problem exists only in Jet 3.51, a component of Office 97, Exchange, Access, Visual Basic and some third-party products. An unrelated problem with the Jet engine concerning Microsoft's Access database was also discovered last year.

A three-judge panel recently issued an informal complaint against Microsoft, aimed at a problem with the word count features in Word 97 and 2000. Apparently the word count feature in Microsoft's word processor doesn't count footnotes and endnotes when any words in the document are highlighted, resulting in an undercount. The standard word number in a legal brief is 14,000, but thanks to the word count bug in Word, documents created with that program sometimes go as high as 16,000. After the complaint was made public, Microsoft promised to fix the problem in Word 95, 97 and 2000. In the meantime, the judges have ordered their clerks to either manually check the word count in legal briefs or prepare them properly with WordPerfect.

Again moving on on territory traditionally belonging to AOL and Yahoo!, Microsoft's MSN last week introduced a free Web hosting service. MSN Community, a direct competitor to Yahoo! GeoCities and AOL's Hometown service, offers 30mb of Web space free to individuals, groups or businesses - in exchange for answering an extensive list of personal questions.
In separate announcements on the same day, Microsoft and 3Com's Palm division announced that they will support the Wireless Application Protocol (WAP) in their handheld computers. Microsoft will use the protocol in its WinCE-enhancing Wireless Knowledge unit, while Palm will license a WAP-compatable Web browser for the PalmPilot from phone.com.
Microsoft customers using beta versions of IE 5 have recently experienced strange error messages, telling them their beta copies of Office 2000 are about to expire. The messages, which come up even on systems that have never seen Office, were accidentally used in a component of IE and should have notified users about the imminent expiration of Internet Explorer - not Office.

CORRECTION: On July 19 we made an error, reporting that Microsoft bought a 9.2% stake in Rogers Communications for US $400. The actual number was US $400 million, not $400. We apologize for the error and any confusion it may have caused for you or your loved ones.

_{Microsoft answers cheerleader suit
Microsoft's Role: Hero Or Villain?
Microsoft: Europe's cable guy?}