Microsoft Software Plays Well with Others, Gates Says

"Open source is a methodology for licensing and/or developing software -- that may or may not be interoperable. Additionally, the open source development approach encourages the creation of many permutations of the same type of software application, which could add implementation and testing overhead to interoperability efforts," Gates said in the letter.

Third-Party Interoperability

Despite the pokes at Linux , the crux of the letter was Microsoft's new commitment to making its software work, not just with its own products, but with other vendors' products. The company had the impetus to make the move.

"U.S. and European courts have indicated [interoperability is] something Microsoft will have to do," said analyst and TechNewsWorld columnist Rob Enderle.

"They had the choice of fighting or getting behind it. This is probably where they should have been all along because this is the sustainable advantage that they've had."

XML-Based

Gates said the company's strategy will focus on next-generation software and Web services based on XML. With Microsoft's huge developer network behind Microsoft's interoperability designs, the company is likely to be able to continue to dictate default standards, even for third-party software.

The XML products the company is working on will work much more smoothly together, Gates said.

"Microsoft has been working with the industry to advance a new generation of software that is interoperable by design, reducing the need for custom development and cumbersome testing and certification," he said.

Microsoft software is already interoperable with hardware from IBM (NYSE: IBM) , among others.

It works with Mac OS's, as well as with versions of Unix, Linux, NetWare and AppleTalk networks, the letter pointed out.

Linux Charges

Enderle said he believes that Gates is speaking the truth about Linux and interoperability.

"Linux benefits from a halo," he said. "It's trendy to talk about good things about Linux. It's trendy to talk about the bad things about Microsoft. There's so much you don't know about Linux, it makes it look better."

The inherently more democratic open-source process is also inherently more messy, Enderle explained. More messy means it can be more difficult to achieve interoperability.