PrinzDoriel D.

Gabriel 11/25/2022
12-ABM Marketers

Apple vs Microsoft(GUI Wars. March 17, 1988)

By guaranteeing authors and inventors the exclusive right to their respective writings and discoveries for
a finite period of time, copyright law primarily serves to advance science and useful arts. The goal is to
benefit the general public by promoting individual initiative through the enhancement of personal gain.
Congress has placed the code that makes up a computer program in the category of works that receive
copyright protection, which is typically given to literary works. A few non-literal expressions are also
protected.

I. Body
On March 17, 1988, Apple unexpectedly filed a lawsuit in federal court against Microsoft for allegedly
breaching Apple's copyrights on the "visual displays" of the Macintosh. (Apple also sued HP for using the
NewWave operating system on top of Windows 2.0.) 189 disputed graphic displays that Apple claimed
infringed on its copyright were included in the lawsuit. Microsoft countersued, but it was unable to stop
the negative press. The Windows developer community was worried that any modifications to the
software mandated by a court would break compatibility between their products and make Windows
unattractive to customers. The CEO of Borland compared it to "waking up and learning that your lover
could have AIDS."

It might be challenging to understand the effect of this loss on Apple's position in the industry given the
company's current dominance in the electronics and computing businesses. Because Apple's Macintosh
was unable to keep up with Windows' popularity during the mid- to late 1990s, the Macintosh appeared to
be in very real danger of failing by 1996. everything changed when Steve Jobs was reinstated to Apple as
an advisor, resuming the company's upward trajectory, which it is still on today.

II. Conclusion

On July 25, 1989, Judge W. Schwarzer ruled that 179 of the disputed displays were covered by the
current license and that the majority of the remaining ten were not infringing on Apple's copyright due to
the merger theory (the merger doctrine states that ideas cannot be copied). This was good news for
Windows programmers.Copyright laws did not apply to many of the displays in the Apple v. Microsoft
lawsuit because they were ideas rather than physical objects. According to the study of (The Apple Vs.
Microsoft GUI Lawsuit | Low End Mac, n.d.)
Until Microsoft invested $100 million in Apple in 1997, the lawsuit ruined Microsoft-Apple relations on
its own.Sculley suffered almost as much harm as the judgment did from the 1985 agreement.The fact that
the CEO of Apple would grant Microsoft complete access to the Macintosh user interface in exchange for
Excel and Word shocked Mac users worldwide. Apple went to the Supreme Court to appeal the decision,
but the court declined to hear the case.
III . Stand about the topic

In my own understanding and observation, I DISAGREE to what apple accusation. Base on what I
presented as a proof below, at first it looks totally the same at the text, software and other settings, but if
you if look closely about their function and other features, you can see their differences. Microsoft has
put a great color combination while apple is stays at black and white.

Supporting Evidences

“The only major application written for Windows 1.01 (the first version available to the public) was
Aldus PageMaker. PageMaker was actually bundled with a runtime version of Windows, since almost no
PC user owned Windows” .“Windows 2.0 actually had programs for it. During the press conference,
Microsoft revealed that it had finished developing Microsoft Word for Windows and Microsoft Excel for
Windows, and that outside companies including Aldus, Corel, and Microtek were all working on
Windows 2.0-compatible programs”. (2022, July 7). Apple’s lawsuit against Microsoft in 1988 | Legal
Blog. Thomson Reuters Law Blog.

Also, Based on other supporting evidences, In Research from In research from (Dormehl, 2022) It says
that “Microsoft first revealed its plans for Windows, Apple had just introduced the GUI to the general
public with its ill-fated Lisa computer. The Lisa’s operating system, like Windows, drew inspiration from
pioneering work carried out a decade earlier at Xerox PARC”.

Another supporting evidence is According to the study of (Kerr, 2017) “The main ‘copying’ that went on
relative to Steve [Jobs] and me is that we both benefited from the work that Xerox PARC did in creating
graphical interface,”. This evidences will strongly support the stand and conclusion of this paper.

References :

Kerr, D. (2017, February 27). Gates solves Apple vs. Microsoft debate, kinda.
CNET. https://www.cnet.com/tech/tech-industry/bill-gates-steve-jobs-solves-apple-vs-microsoft-
debate-xerox/

Dormehl, L. (2022, November 10). Today in Apple history: Microsoft reveals plan for Windows 1.0. Cult
of Mac. https://www.cultofmac.com/513127/apple-history-windows-1-0/

(2022, July 7). Apple’s lawsuit against Microsoft in 1988 | Legal Blog. Thomson Reuters Law
Blog. https://legal.thomsonreuters.com/blog/1988-apple-sues-microsoft/

The Apple vs. Microsoft GUI Lawsuit | Low End Mac. (n.d.). https://lowendmac.com/2006/the-apple-vs-
microsoft-gui-lawsuit/
Articles:

I.
Today in Apple history: Microsoft reveals its plans for Windows 1.0
November 10, 1983: Microsoft tells the world about an upcoming product called Windows that will bring
the graphical user interface to IBM PCs. Although Microsoft’s announcement about the new operating
system comes before Apple launches the Mac in 1984, Windows 1.0 won’t actually ship until November
1985, earning it a reputation as “vaporware.”
At the time, Apple doesn’t view Windows as much of a threat. That doesn’t take long to change,
however.
The Lisa computer and the GUI
When Microsoft first revealed its plans for Windows, Apple had just introduced the GUI to the general
public with its ill-fated Lisa computer. The Lisa’s operating system, like Windows, drew inspiration from
pioneering work carried out a decade earlier at Xerox PARC.
“The main ‘copying’ that went on relative to Steve [Jobs] and me is that we both benefited from the work
that Xerox PARC did in creating graphical interface,” Bill Gates admitted during a Reddit AMA session
in 2017. “It wasn’t just them but they did the best work…. We didn’t violate any [intellectual property]
rights Xerox had but their work showed the way that led to the Mac and Windows.”

Windows 1.0: Not great

Compared to the Lisa, however, Windows 1.0 looked incredibly limited. Microsoft’s software engineers
based it on the same concepts of pull-down menus, mouse support and tiled windows. However, they
failed to pull it off.
Windows did do one thing that grabbed people’s attention, though. It appealed to customers with its low
price of just $99.

By the time Windows 1.0 launched, Microsoft was best known as a developer for the Mac. After Steve
Jobs left Apple in 1985, Microsoft used its position as the maker of Word and Excel to strong-arm Apple
CEO John Sculley into signing a deal granting Microsoft “non-exclusive, worldwide, royalty-free,
perpetual, nontransferable license to use [parts of the Mac technology] in present and future software
programs” for its then-fledgling Windows.
Apple-Microsoft battle intensifies
Not seeing the potential of Windows, Sculley agreed to the deal. It wasn’t until version 2 of Windows,
which looked suspiciously similar to Mac OS, that Apple sued Microsoft for copyright infringement.
Microsoft then went from strength to strength, as PC sales went through the roof during the following
decade. At the same time, Apple faltered.

The long-running Microsoft-Apple legal battles ultimately got resolved in August 1997, when Cupertino
agreed to drop all lawsuits against its rival. By that point, Microsoft was nearing the height of its post-
Windows 95 power. And Apple was ready to start climbing back to the top of the tech industry.

II.
Today in 1988: Apple sues Microsoft for copyright infringement
If you were paying attention to the computing world in any measure during the 1990s, you knew about
the raging Mac versus PC debate. In fact, it was one of the defining elements of 1990s computing.
Although that dispute is now largely a thing of the past, there was definitely some true animosity between
Apple and Microsoft, particularly because of the events leading up to Apple suing Microsoft for copyright
infringement on March 17, 1988.

The lawsuit was filed only a few months after Microsoft released Windows 2.0, which was a marked
improvement over the first version. According to the higher-ups at Apple, this was because Microsoft
copied Macintosh’s visual displays — and did so without a license. Let me back up for a minute and
explain: We all take for granted the graphical user interface (GUI) of today’s computers, but, as this New
York Times article about the lawsuit demonstrates with its description about GUI, it was a novel idea at
the time, the application to consumer products of which was largely attributable to Apple:

That appearance is based on what the industry calls a graphical user interface, in which information
appears in windows and operations are carried out by pointing at objects and menus using a handheld
device called a mouse – a major selling point of the Macintosh. Anyway, Microsoft and it’s leader Bill
Gates were the first outside developer to get a Macintosh prototype before its release in 1984. The
company was to create productivity software (word processing, spreadsheets, etc.) for the Mac.
Gates instantly fell in love with the Mac OS, and after the public unveiling of the Macintosh, Gates
essentially begged Apple to license the software to outside manufacturers so that the Macintosh would
become the standard in personal computing.
Although there has been much speculation to Gates’s motivations in doing this, Gates himself later stated
that Microsoft’s software profit margins were much higher on MacOS than for those on IBM’s licensed
MSDOS platform.
For a number of reasons, Gates’s proposal was rejected by Jean-Louis Gassée, who had been given
control of the Macintosh and Lisa projects after Steve Jobs was ousted from them.
Later, in November of 1985, Microsoft released Windows 1.0, which alarmed a number of individuals at
Apple because they believed that Microsoft had stolen several design elements of the Mac operating
system. Apple threatened to sue.Because of the close relationship between the two companies, however
(Microsoft’s productivity software was a heavy driver of sales for the Macintosh), they eventually came
to an agreement, wherein Apple licensed Macintosh design elements to Microsoft to be used in Windows.
For whatever reason, though, Apple’s legal team didn’t catch the fact that the agreement was written to
license the use of Apple features in Windows 1.0 and all future Microsoft software programs.

You can imagine Apple’s surprise, then, when Windows 2.0 was released and contained even more
design elements copied straight from the Macintosh operating system. Apple was apparently so upset by
this that it skipped threatening letters and phone calls and went straight to filing a lawsuit (a lawsuit
which is today celebrating its 31st anniversary).
Unfortunately for Apple, on July 25, 1989, Judge William Schwarzer ruled that 179 of the 189 contested
visual displays that Apple claimed infringed in its copyrights were covered by the existing license, and
the rest weren’t eligible for copyright anyhow because of the merger doctrine (which holds that ideas
cannot be copyrighted).After a number of appeals, the legal battled ended on February 21, 1995, when the
Supreme Court denied Apple’s petition for writ of certiorari. In light of Apple’s contemporary dominance
in the computing and electronics markets, it may be difficult to appreciate the impact of this loss on
Apple’s position in the industry. It was during the mid- to late 90’s that Windows rose to prominence, and
Apple’s Macintosh was unable to keep up, such that by 1996, it looked to be in very real danger of
failure.Of course, that all turned around after Steve Jobs was brought back in to Apple as an advisor,
bringing the company back onto the path of growth — one on which it continues today.
But prior to this turnaround, the lawsuit and its eventual failure were symbolic of Apple’s fortunes
throughout most of the 1990s, and although history will be unlikely to remember it for any legal
significance, it certainly is a major milestone in the history of computing and technological
advancements.Even the biggest and most influential companies can face serious setbacks. Make sure your
firm is always on the cutting edge by staying embracing the latest technology and following legal changes
and updates.
(https://legal.thomsonreuters.com/blog/1988-apple-sues-microsoft/ )

III.
The Apple vs. Microsoft GUI Lawsuit
Microsoft was deeply involved in the development of the Macintosh. Microsoft had been the
first outside developer to get a Macintosh prototype. The prototype was promptly nicknamed
SAND (Steve’s Amazing New Device) by Bill Gates and Charles Simonyi.

Microsoft developed productivity software that the Macintosh desperately needed to make
the Macintosh a contender in corporate markets.

License This

After the public unveiling of the Macintosh, Bill Gates personally wrote John Sculley, urging
him to license the software and ROMs to outside manufacturers so that the Macintosh
would become the new standard in personal computing. (This was two years after Microsoft
began development of Interface Manager, which was renamed Windows shortly before
release.)

The proposal, dated June 25, 1985, was soundly rejected by Jean-Louis Gassée, who was
given control of the Macintosh and Lisa after Steve Jobs had been stripped of management
responsibilities. Gassée reasoned that the Macintosh was so vastly superior to the existing
PC graphical environments that Apple would never face any serious competition and would
be able to rely on profit-rich hardware sales (with margins over 55% until the early 90s).

Besides protecting profits, Gassée was probably a little distrustful of Microsoft’s motives. It
was in Microsoft’s interest to maintain the IBM PC standard for as long as possible, since
Microsoft controlled most of the operating system market and most of the developer’s tools
market. In Gassée’s mind, the proposal could have been an attempt to sabotage the
Macintosh.

In later interviews, however, Bill Gates points out that Microsoft

made a lot more money selling a Mac user a copy of Word
and MultiPlan (the predecessor of Excel) than selling an OEM
DOS license, so a Macintosh standard would have benefited
both companies in the long term.

Despite Gassée’s objections to the plan, Sculley believed that it

could help Apple establish the Macintosh as the personal
computer standard, supplanting the IBM PC and MS-DOS.

Sculley had Dan Eilers, one of his aides, prepare a list of possible licensing deals. The list
of suggestions included selling entire system boards to manufacturers, porting the
Macintosh software to the IBM PC and selling the software to consumers, partnering with a
workstation vendor, and others.

Salivating Over the Mac OS

Armed with a list of proposals, Sculley sent a vice president, Chuck Berger, to travel the
nation talking to possible Macintosh licensees. Interest was astounding. Eilers and Gates
had both suggested consumer electronics companies with no presence in the US computer
market, but Berger found that even large, well established companies were interested in
licensing the Macintosh. Apollo, DEC, and Wang all gave Berger letters of intent.

By far the most promising prospect was AT&T. The company was so interested in bundling
the Macintosh software on its Unix workstations that CEO Bob Allen personally contacted
John Sculley.

Apple was poised to license the Macintosh software to several major manufacturers and get
the Macintosh standard firmly established in the business market, but Gassée would have
none of it. He became more and more adamant in his opposition to the plan. He wouldn’t
have any other company cannibalize Apple’s Macintosh sales, even if it meant establishing
an industrywide standard.

Forget It

During the winter of 1985, Sculley dropped all plans to license the Mac OS, only one year
after he sent Chuck Berger to drum up support for the plan.
Macintosh sales were collapsing. Apple had originally forecasted that it would sell 50,000
Macs a month during 1985, but the real figure was closer to 20,000.

With Macintosh sales tanking and no licensee in sight, Gates pressed ahead with Windows.
On November 15, 1985, in the midst of the COMDEX trade show, Gates revealed Windows
to a lukewarm response.

There were already other companies with far more impressive environments than
Windows. Digital Research GEM mimicked the Mac interface almost perfectly – and had
color to boot. VisiCorp VisiOn had a built-in office suite. Tandy DeskMate was bundled on
every PC compatible Radio Shack (then one of the largest cloners) sold.

Windows 1.0 ‘No Threat’

Microsoft Windows 1.0 had a tiled interface; windows couldn’t overlap each other. Instead,
users could move windows around like a jigsaw puzzle.

Windows 1.0 with its tile interface (rescaled from 640 x 350 EGA display)
When a user only needed one app at a time, he or she could zoom it to take up the entire
display. Apps could also be minimized to the “desktop”, a dock running along the bottom of
the screen.

When Gassée saw Windows 1.0, he dismissed the software as no threat.

But when Sculley saw the software, he was enraged. Microsoft had been provided early
prototypes of the Macintosh and some source code to help optimize Word and MultiPlan.
Now Windows had a menu bar almost identical to Apple’s. Windows even had
a Special menu, containing disk operations. Other elements were strikingly similar.
Windows came bundled with Write and Paint, both mimicking Apple’s MacPaint and
MacWrite.

Sculley couldn’t allow Microsoft, a company that had only $25 million in sales in 1983
(compared to Apple’s revenues well over $1 billion) to so flagrantly rip off the Mac, even if
Word and MultiPlan accounted for two-thirds of all Macintosh software sales.

He dispatched an Apple lawyer, Jack Brown, to Microsoft’s headquarters to threaten Bill

Gates with a lawsuit for violation of Apple’s copyrights on the Macintosh.

Toe to Toe

Gates was incensed. Development of Windows had begun before

the Macintosh was even demonstrated to Microsoft. Besides, Microsoft had licensed GUI
elements from Xerox, including a desktop-style interface used on the Xerox 8010, the
commercial version of the Alto. (Apple had also licensed the GUI from Xerox for $100
million in Apple stock.)

Bill Gates supposedly called Sculley personally and told him that if Apple was going to sue
Microsoft, “I want to know it, because we’ll stop development on all Mac products. I hope we
can find a way to settle this thing. The Mac is important to us and to our sales.”

Gates and Microsoft’s chief counsel, Bill Neukom, flew down to Cupertino, and he met with
Sculley in the boardroom one-on-one.

Sculley couldn’t leave the meeting without some sort of concession from Microsoft, and
Gates wanted Apple’s cooperation in the nascent (and highly profitable) Microsoft Office.

Both men wanted to avoid a drawn out lawsuit. Gates was gearing up for the wildly
successful Microsoft IPO, and Sculley was still trying to popularize the Macintosh.

Ultimately, Sculley agreed to license the Macintosh’s “visual displays” to Microsoft to use in
software derived from Windows 1.0, and Microsoft agreed to continue developing its Mac
products and promised not to release Excel (a feature-rich replacement for MultiPlan) for
any other platform for two years.
Sculley had Al Eisenstat, Apple’s chief counsel, draw up a contract, and the two men signed
on November, 22 1985, exactly one week after Windows 1.0 was released.

After the contract was signed, Sculley implemented a major reorganization that structured
the company more like a traditional corporation with accountable executives. Pie in the sky
projects like BigMac, a project to create an Apple workstation running a Unix-Macintosh
hybrid, were canned. Sales began to improve in 1986, and by 1987 Apple’s net income had
doubled over 1985. Sculley was being lauded in the press for his turnaround at Apple and
was being considered a possible successor to Kodak’s struggling CEO.

Windows 1.0 Fails to Open Market

Meanwhile, the first version of Windows failed to catch on. The only major application
written for Windows 1.01 (the first version available to the public) was Aldus PageMaker.
PageMaker was actually bundled with a runtime version of Windows, since almost no PC
user owned Windows.

That began to change with the release of Windows 2.0 on November, 1 1987.

Windows 2.0 with overlapping windows (reduced from 640 x 480)

Windows 2.0 was a huge improvement over version 1.0, and Sculley recognized it. The new
version offered overlapping windows, multitasking, and a limited object oriented
environment (through a rudimentary version of OLE).
Besides the new features, Windows 2.0 actually had programs for it. During the press
conference, Microsoft revealed that it had finished developing Microsoft Word for Windows
and Microsoft Excel for Windows, and that outside companies including Aldus, Corel, and
Microtek were all working on Windows 2.0-compatible programs.

Sculley was shocked at how much Windows 2.0 resembled the Macintosh, and he believed
this to be a breach of contract. Sculley, along with most of the Apple legal team, believed
that the November 1985 agreement gave Microsoft permission to use Macintosh displays in
Windows 1.x, but not in any later versions.

Talk to the Judge

Without warning, Apple filed suit against Microsoft in federal court on March 17, 1988 for
violating Apple’s copyrights on the “visual displays” of the Macintosh. (Apple also filed suit
against HP for its NewWave environment that ran on top of Windows 2.0.)

Apple’s suit included 189 contested visual displays that Apple believed violated its
copyright.

Microsoft countersued, but it failed to stem the bad publicity. Windows’ development
community was terrified that any court ordered changes to the software would render their
products incompatible and make Windows undesirable to consumers. Borland’s CEO said it
was like “waking up and finding out that your partner might have AIDS.”

Fortunately for Windows developers, Judge W. Schwarzer ruled on July 25, 1989, that 179
of the 189 disputed displays were covered by the existing license, and most of the other ten
were not violations of Apple’s copyright due to the merger doctrine (the merger doctrine
stipulates that ideas cannot be copyrighted). In the case of Apple vs. Microsoft, many of the
displays Apple contested were ideas and could not be protected by copyright.

The lawsuit was decided in Microsoft’s favor on August 24, 1993.

Strained Relationship

The lawsuit single-handedly tainted Microsoft-Apple relations until 1997, when Microsoft
pumped $100 million into Apple.

The 1985 agreement hurt Sculley almost as much as the judgment did. Mac users
everywhere were shocked that the Apple CEO would give Microsoft unfettered access to
the Macintosh interface in exchange for Excel and Word.

Apple appealed the ruling and made it all the way to the Supreme Court, which declined to
hear the case. (https://lowendmac.com/2006/the-apple-vs-microsoft-gui-lawsuit/ )