Love-Hate Relationship between Microsoft and Intel

Microsoft used to inspire dread in the tech industry. With a few notable exceptions, most rivals and partners did their best not to get on Bill Gates' bad side. But recently, we find that Microsoft agreed to a two-tiered Vista upgrade program that its managers probably knew was a mistake.

By far, Microsoft managers have allowed their partner Intel to drive their consumer experience. Computer makers supported Intel’s goals and they've made graphics investments to drive the user experience with consumers. Therefore, Microsoft had to be soft to allow the potential development by Intel to drive the full user experience.

Historically, the love-hate Microsoft-Intel relationship goes back years. But back before getting clobbered by Google and the Web 2.0 crowd, Microsoft was famous for throwing its weight around even with Intel. Remember how much they hated each other during the U.S. Justice Department's antitrust lawsuit in the late 1990s? In fact, Gates said, “Intel could not count on Microsoft to support Intel's next generation of microprocessors as long as Intel was developing platform-level software that competed with Windows. Intel's senior executives knew fully well that Intel would have difficultly selling PC microprocessors if Microsoft stopped cooperating in making them compatible with Windows and if Microsoft stated to OEMs that it did not support Intel's chips. Faced with Gates' threat, Intel agreed to stop developing platform-level interfaces that might draw support away from interfaces exposed by Windows.”

That was then and this is now. The antitrust case era has gone, and Microsoft has new and equally pressing concerns. In the meantime, I think Intel is likely to get an earful from its customers as more e-mail revelations surface detailing backroom pressure on Microsoft over its "Vista Capable" program. Along with this, the bedroom partners will have to resolve their worries -- back in bed.