EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

05.24.09

Microsoft Sued Over Its Corruption in Switzerland, Microsoft Debt Revisited

Posted in Europe, Finance, Fraud, Law, Microsoft, Red Hat at 2:23 am by Dr. Roy Schestowitz

Switzerland money

Summary: Microsoft is sued by Red Hat for secret deals while the red ink seems to be quietly dripping

MICROSOFT’S illegal dealings in Switzerland are a subject that we wrote about earlier this month in:

Switzerland, being a nation of banking for the most part at least in people’s minds, thrives in trust and responsibility. Swiss citizens knew what Microsoft was up to and they responded:

Asking Switzerland for more neutrality …

[...]

Well – a lot of people in Switzerland and almost 20 companies are not really happy. Among these companies is Red Hat. So Red Hat is joining the official appeal that asks the court to stop this contract, force BBL to evaluate the alternatives that exist and are in active use, even in Switzerland in the offical way of public tendering.

Effectively the appeal asks the BBL to defend competition. In a vendor neutral way. Based on technical merits. I think it is fair to ask. Let the court decide.

And ofcourse the irony of asking Switzerland of all countries to act in a (vendor-) neutral way is quite funny.

As the above already suggests, Red Hat’s legal team is stepping in.

Red Hat is a leader of an appeal by 18 technology companies of a Swiss government agency’s award of a no-bid contract to Microsoft. The challenge raises important issues of openness in government and of a level playing field for open source and other competitors of Microsoft. Red Hat is seeking a public bidding process that allows for consideration of the technical and commercial advantages of open source software products.

There is some press coverage only from Peter Judge, but hopefully the word will spread and inspire other countries to do the same thing. It is certainly a broader issue.

£8 million a year to Microsoft, with no public bidding. And that’s just the tip of the iceberg, say open source activists

Linux vendor Red Hat, and 17 other vendors, have protested a Swiss government contract given to Microsoft without any public bidding. The move exposes a wider Microsoft monopoly that European governments accept, despite their lip service for open source, according to commentators.

The Red Hat group has asked a Swiss federal court to overturn a three-year contract issued to Microsoft by the Swiss Federal Bureau for Building and Logistics, to provide Windows desktops and applications, with support and maintenance, for 14 million Swiss Franc (£8 million) each year. The contract, for “standardised workstations”, was issued with no public bidding process, Red Hat’s legal team reports in a blog – because the Swiss agency asserted there was no sufficient alternative to Microsoft products.

For Microsoft to stoop down to these tactics of secret deals is not particularly surprising. See the following writings about Microsoft’s financial situation, which suffers from endless dumping of software and hefty fines:

As that last link shows, Microsoft is already taking debt. In fact, Microsoft’s debt is now receiving the blessing of a criminal company, which gives Microsoft (MSFT) debt a high rating.

DaemonFC says that “Microsoft is trying to sell debt bonds” and Twitter explains that “the $30 billion of cash had conflicts with other reports of $20 and it’s more likely they have none.”

“Microsoft is actually done with buybacks.”Further he explains: “at the end of 2008 they said they would go $20 billion in debt to buy $40 billion of their shares. Over the last couple of weeks there were a number of articles that acted like this is what they were doing. I thought they had already done their buy backs.”

Microsoft is actually done with buybacks. They announced it one month ago and it is odd because the company has purchased its stock heavily for many years. At that stage, namely the point where undisclosed buybacks are complete (their scale is disclosed, not the purchasing pace), according to their plans they would be about $5 billion in debt. Unless they cut these buybacks short, it would only make sense for Microsoft to be in debt right now. But as Twitter says, “If Microsoft is done with buybacks, why are there so many BS articles about it? [...] and this earlier article acts as if no one was sure.” To quote: “We know not why a company the size and shape of Microsoft needs to raise money through debt issuance–it already has over $30 billion in cash at hand on its books–but if this is a cost-of-capital initiative that leads to the company buying back some of its own float, shareholders may be in for a treat.

What exactly is going on here? Someone is not telling the whole truth as there are contradictions that we are able to identify.

“There is such an overvaluation of technology stocks that it is absurd. I would include our stock in that category. It is bad for the long-term worth of the economy.”

Steve Ballmer

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

A Single Comment

  1. amd-linux said,

    May 24, 2009 at 4:34 am

    Gravatar

    Roy,

    while not being an expert in US GAP, it could be possible that

    - cash as accounted in the MS balance sheet care mostly short and medium term bonds, not real cash or account deposits at a bank
    - the actual losses in valuation of these bonds are not being reflected fully in their balance sheet because as the are accounted as “HTM”, hold to maturity, instead of mark to market, in the hope that the issuer of these bonds can repay them, but there is currently no market with fair prices or huge spreads.

    So, in essence, their balance sheets show us huge “cash” reserves but that might give a wrong picture about their liquidity. And liquidity is want you need – cause with liquidity you pay the bills. If you assets are not liquid, you might die as a rich man, so to say :-)

    Banks did not collapse because they ran out of assets but in the cases I am familiar with, they financed long term credits they issued with short term credits they borrowed – but when the market dried out, boom…… although they had this huuuuge assets in their portfolio.

    So maybe MS manouvred itself in a similar situation, which looked very attractive until 9 months ago, as you could realize huge interest rate profits by refinancing long term, high interest rate credit facilities with short term low rate loans.

    This is my personal speculation, I have not the slightest clue if this is true – but as a model, it IMHO can explain why MS needs to borrow money.

    http://en.wikipedia.org/wiki/Mark_to_market
    http://www.americanbanker.com/glossary.html?alpha=H

What Else is New


  1. Scanning Patent Troll Implodes; Is the Podcasting Patent Troll Next?

    MPHJ loses and Personal Audio LLC perhaps wins for the last time since software patents are quickly losing legitimacy in the United States



  2. If CAFC is Not Above the Law, Then it Should be Shut Down Now

    A long series of abuses in CAFC may as well suggest that this court has become broken beyond repair



  3. The Latest From Microsoft Patent Trolls and Patent Partners

    Microsoft-linked and Linux-hostile trolls continue their relentless attacks (albeit with little or no success) while patents as a weapon lose their teeth owing to a Supreme Court ruling



  4. Microsoft Proves That Its Massive Layoffs Are Not About Nokia

    Microsoft is laying off a lot of employees who have nothing at all to do with Nokia



  5. Links 19/9/2014: Another Red Hat Acquisition, Netflix Dumps Microsoft Silverlight and Brings DRM to WWW

    Links for the day



  6. Links 18/9/2014: Windows Copying GNU/Linux, Germany Moves to Security

    Links for the day



  7. Web Site 'Patent Progress' Now Officially 'Powered by CCIA' (FRAND Proponent, Microsoft Front)

    After talking a job at CCIA, "Patent Progress" and its chief author should be treated as dubious on real patent progress



  8. Articles About the Death of Software Patents in the United States

    Recent coverage of software patents and their demise in their country of origin, where even proponents of software patents are giving up



  9. The Death of Software Patents is Already Killing Some Major Patent Trolls

    VirnetX seems to be the latest victim of the demise of software patents in the United States



  10. More Microsoft Layoffs

    More Microsoft layoffs go ahead as the company is unable to compete



  11. ODF on the Rise

    Milestones for OpenDocument Format (ODF) and the launch of FixMyDocuments



  12. Links 17/9/2014: CoreOS, ChromeOS, and systemd

    Links for the day



  13. Italy is Cracking Down on Microsoft's Monopoly Abuse While Gradually Moving to GNU/Linux

    Italy is not only moving to Free/Open Source software but also to GNU/Linux while at the same time barring Microsoft from forcibly tying Windows to new PCs



  14. OpenSUSE's 'Assurances' Are Classic MBA School Hogwash

    OpenSUSE is not part of any commitment, except for SUSE's; the impact of the Novell/SUSE acquisition casts uncertainty on the project's future



  15. Links 16/9/2014: Firefox OS Smartphones in Bangladesh, “Treasure Map” of the Internet

    Links for the day



  16. The United Kingdom Should Dump Microsoft For the Sake of National Security

    The UK has issues of Microsoft dependency and Windows viruses; its migration to Free software and GNU/Linux is not fast enough to guard its autonomy in the age of digital imperialism



  17. CBS Hires Even More Microsoft Staff to Cover Microsoft Matters

    CBS continues to be infested with Microsoft staff past and present (this time Dave Johnson) and the bias in output is quite revealing



  18. Microsoft Has Just Killed Minecraft for GNU/Linux and the Possibility of Free/Open Source Releases

    Persson sells out to Microsoft and lets the abusive monopolist destroy the popular cross-platform game that a community has been built around



  19. Another Reason to Boycott Intel UEFI

    More anti-competitive aspects are revealed inside UEFI, which helps merginalise GNU/Linux



  20. Quick Mention: Novell and SUSE Passed to Microsoft's 'Partner of the Year', Microsoft Focus

    Novell is changing hands again, and falling into the hands of even more Microsoft-friendly actors



  21. Links 16/9/2014: Linux 3.17 RC5, KDE Frameworks 5.2.0

    Links for the day



  22. Željko Topić, Benoît Battistelli, and the European Patent Office (EPO): Part II

    Part II of our look into the EPO appointment of Željko Topić and other matters showing the dubious integrity of the EPO



  23. Links 14/9/2014: Android-based Watches Earn Optimism

    Links for the day



  24. Links 14/9/2014: Eucalyptus Devoured

    Links for the day



  25. Links 11/9/2014: Linux Toilet Project, Linux-Based Wheelchair Project

    Links for the day



  26. Links 10/9/2014: Brian Stevens in Google, Ubuntu 14.10 Expectations

    Links for the day



  27. Links 9/9/2014: Hating/Loving Linux, Android Aplenty

    Links for the day



  28. Links 8/9/2014: Linux 3.17 RC 4, Switzerland Welcoming Snowden

    Links for the day



  29. Suspicion of High-Level Corruption at the European Patent Office (EPO): Part I

    The European Patent Office (EPO) Vice-President has a background of corruption and his appointment to the EPO too is believed to be reliant on systemic corruption



  30. Links 6/9/2014: Core OS at DigitalOcean, Women in Xorg

    Links for the day


CoPilotCo

RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

CoPilotCo

Recent Posts