Will Apple-Microsoft renew their vows?

Saw this over at ZDNet News

Five years ago, Apple Computer announced an almost unthinkable pact with Microsoft: The software giant would continue to develop Office software for the Mac, and Apple would bundle Internet Explorer in all new machines.

In addition to the Office-Explorer trade-off, the pact called for Microsoft to purchase $150 million in Apple stock and for Apple to drop a long-standing patent lawsuit. Current Apple CEO Steve Jobs hailed the announcement at Macworld Expo in August 1997 as a much-needed boost for Apple, but many Mac fans were unconvinced.

The agreement, however, expires this summer, raising the question of whether the two companies--which have long had a love-hate relationship--will reaffirm their commitments or begin to drift apart.

"Apple needed this agreement more five years ago than they do today," said Technology Business Research analyst Tim Deal. "Microsoft and Apple were practically at war over the patent dispute and other issues."

Tensions seemed to have eased, but the companies remain occasionally at odds, making the expiration of the pact a potential issue. For example, in recent months, Apple has opposed a controversial civil lawsuit settlement. The deal, which would have showered schools with Microsoft software and as many as 1 million refurbished PCs running Windows, was later thrown out by a federal judge.

In addition, Apple in December decided to use Netscape to power the default home page on new machines bundled with Internet Explorer. Netscape is owned by Microsoft archrival AOL Time Warner.

News source: ZDNet News

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