In The Pay of Foundations: How U.S. power elite foundations fund a `parallel left' media network--Part 18

Democracy Now! foundation funder: Owns Microsoft/RealNetworks stock

In The Pay of Foundations—Part 18

How U.S. power elite and liberal establishment foundations fund a “parallel left” media network of left media journalists and gatekeepers.

Randall Rothenberg’s Aug.1,1999 Wired magazine article indicated that longtime Democracy Now! funder Glaser developed a “strategic alliance” between his RealNetworks Inc. and Bill Gates’s Microsoft in 1997:

“Bill Gates…eventually came to understand that his former protégé was on to something - something he wanted….In 1997,…Microsoft was becoming a… competitive threat. .Glaser quickly arranged a Friday evening meeting with two Microsoft senior executives, Paul Maritz and Greg Maffei…A strategic alliance was quickly cemented, which allowed Microsoft to license, for $30 million, Real's version 4.0 source code and bundle the client with Internet Explorer. The source code would enable Microsoft to make software capable of playing and serving the enormous amount of Web content available in Real's format. Microsoft spent another $30 million for a 10 percent stake in Real….”

DemocracyNow! funder's firm formed "strategic alliance" with Microsoft monopoly in 1997

As Amy Kover’s 2000 Fortune magazine article noted, in 1997 “Glaser's most richly layered relationship” was “with Microsoft;” and “his relationship with Microsoft seemed fine--the software giant even bought a 10% stake in Real in 1997.”

But after Microsoft “delivered a killing blow” to RealNetworks Inc.’s “main revenue source” by releasing “its own, free version of the Real server,” according to the 1999 Wired magazine article, former Microsoft VP Glaser then testified before a U.S. Senate Committee on July 23, 1998 that “I believe Microsoft is taking actions that create obstacles to the freedom and openness of the Internet” and that “What Microsoft is doing is wrong and must be stopped.” And “a few months later, Microsoft withdrew its investment” in RealNetworks, according to the 2000 Fortune magazine article.

Yet despite Glaser’s 1998 assertion that “What Microsoft is doing is wrong and must be stopped,” his Glaser Progress Foundation was still willing to own 107,520 shares of Microsoft stock, worth $7,123,200 [equal to over $10 million in 2018] in 2001, according to its Form 990 financial filing for 2001, when the Glaser Progress Foundation gave the Institute for Media Analysis a $40,000 [equal to over $56,000 in 2018] grant to help fund “Democracy Now! `War and Peace Report.’

And from its 2.107,545 shares of RealNetworks stock that was worth $12,518,817 [equal to over $17.7 million in 2018] and its investment in Microsoft monopoly stock--his Glaser Progress Foundation received $764,356 [equal to over $1 million in 2018] in dividends in 2001.

Since Gates’ Microsoft monopoly was apparently still now threatening the ability of Glaser’s RealNetworks firm to make big money from the digital media market in the early 21st-century, in late 2003 Glaser’s RealNetworks lawyers filed a lawsuit against Microsoft. As Joris Evers and Robert McMillan observed in a Dec.18, 2003 IDG News Service article that was reposted on the PC World magazine’s website:

“RealNetworks has filed a lawsuit against Microsoft, alleging the software giant has illegally used its power as a monopoly to control the digital media market.…RealNetworks accuses Microsoft of unlawful tactics including product bundling, restrictive licensing, exclusive dealing, predatory pricing, refusing to sell unbundled operating systems and discriminatory disclosure and withholding of information needed to interoperate with the Windows operating system, according to a copy of the complaint. The lawsuit seeks to recover damages lost because of `Microsoft's illegal conduct,’ according to statement attributed to Rob Glaser, RealNetworks' chair and CEO. He is a former Microsoft official… In 1997, Microsoft had virtually no presence in the digital media space, but by 2002, Microsoft's `anticompetitive conduct’ enabled it to surpass RealNetworks' market share for media players and usage in the U.S., RealNetworks says in its complaint…” 

In response to RealNetworks’ lawsuit, however, Microsoft agreed to pay Democray Now! show funder Glaser’s RealNetworks media firm a settlement of $761 million in 2005 and, according to Elizabeth Montalbano’s Oct. 11, 2005 IDG News Service article that PC World reposted on its website,  Microsoft and RealNetworks then “forged a partnership to promote digital music and games in three agreements.” As the same 2005 article also observed:

“Microsoft will pay RealNetworks $460 million up front to resolve all damages and claims in the suit, and the companies will agree to a series of technology licenses and commitments that will give RealNetworks long-term access to Windows Media technologies to enhance its own media software, according to the companies. Under the terms of the deals, the companies…will jointly promote and market RealNetworks' music subscription service, Rhapsody, on Microsoft MSN. In addition, Microsoft will offer RealNetworks' digital games through MSN Games and Xbox Live Arcade for XBox 360…Microsoft Chairman and Chief Architect Bill Gates said that the settlement spells an opportunity for Microsoft and RealNetworks to collaborate on innovative ways to deliver digital media to consumers on a variety of devices….

“Microsoft also will pay RealNetworks $301 million in cash and provide services over 18 months to support RealNetworks' product development, distribution, and marketing under the music and game agreements. At the same time, RealNetworks will support MSN Search, and the two companies together will promote the use of Windows Media technologies with RealNetworks' Rhapsody to Go service, according to the companies. In addition, RealNetworks also will support Microsoft's Windows Media DRM (digital rights management) format in its RealPlayer media software, a move that helps Microsoft evolve Windows as the platform for a digital media hub, said Matt Rosoff, an analyst with Directions on Microsoft.”

And despite his firm’s 2003 lawsuit and his 2003 assertion that Microsoft was still engaging in “illegal conduct” in the early 21st-century, in 2004—when Democracy Now! Productions was given a grant of $100,000 [equal to over $133,000 in 2018] by the Glaser Progress Foundation—Glaser’s foundation still owned 215,000 shares of Microsoft stock, worth $5,745,869 [equal to over $7.6 million in 2018], from which it received a net investment income of $744,197 [equal to over $995,000 in 2018], according to the Glaser Progress Foundation’s Form 990 financial filing for 2004..

DemocracyNow! funder: Received $761 Million from/Partnered with Microsoft in 2005

Thus, after helping to fund Democracy Now! between 2001 and 2004 with 4 grants, totaling $300,000, former Microsoft VP Glaser’s Glaser Progress Foundation, continued to own millions of dollars worth of Microsoft monopoly corporate stock at the same time it funded Democracy Now!; and Glaser's RealNetworks firm continue to collaborate on a business level with Gates' Microsoft monopoly.. Yet, not surprisingly, Democracy Now! did not air many news segments between 2005 and 2018 that examined how Glaser obtained his personal wealth or how his Glaser Progress Foundation obtained its grant money.  (end of part 18)

In The Pay of Foundations: How U.S. power elite foundations fund a `parallel left' media network--Part 16

Democracy Now! Funder/Ex-Microsoft VP Glaser Partnered With IBM

In The Pay of Foundations—Part 16

How U.S. power elite and liberal establishment foundations fund a “parallel left” media network of left media journalists and gatekeepers. 

Multi-billionaire Bill Gates and Democracy Now! Productions funder Rob Glaser’s Microsoft had personally enriched both businessmen during the 1980s period, when Microsoft partnered with the transnational corporation, IBM, for 9 years; and when Microsoft apparently also engaged in monopolistic business practices. According to Gary Rivlin’s 1999 The Plot To Get Bill Gates book:

“IBM and Microsoft weren’t that different. At Microsoft they were still company men…IBM…had taken Gates’s measure and deemed him…its kind of man…The chairman of IBM knew Gates’s mother because both served on the national board of United Way…So eager was Gates to remain on good terms with IBM that in 1985 or 1987 he offered Big Blue a 30 percent stake in Microsoft. Executives at IBM brushed aside the offer…”

James Wallace and Jim Erickson’s 1992 book, Hard Drive: Bill Gates and the Making of the Microsoft Empire also recalled: 

“…IBM chief executive John Opel…knew Mary Gates, having served with her on the national board of United Way…Whether this United Way connection helped Microsoft get the IBM deal is not clear. Opel…won’t talk…In early November of 1980, the corporate…couple officially signed the paperwork. Microsoft would develop the `software for IBM’s first personal computer and supply the vital disk operating system or DOS…Chairman Bill sold 5 percent of Microsoft for a million dollars to Technology Venture Investors, a venture capital firm in Menlo, California…David Marquardt, a general partner in TVI, was made a director of Microsoft’s new board…The company went public…in 1986…As the IBM PC gained in popularity, more and more programmers wrote software for that machine and for the operating system Gates had acquired…”

And according to Randall E. Stross’s 1996 The Microsoft Way book:

“The great stroke of luck that provided Microsoft with 10 very good years came in 1980 when it signed a contract with IBM to provide the operating system that would be used on the IBM Personal Computer, introduced the next year…Microsoft, which itself did not have an operating system to offer, bought another, still smaller company’s operating system software to adapt for the project. The contract…worked greatly in Microsoft’s favor. The terms permitted Microsoft to sell the operating system to other companies and to consumers, but IBM, effectively could not…Microsoft’s rivals have raised questions of monopoly that staff members of the Federal Trade Commission and the Justice Department have largely accepted…Gates is remembered as the precociously outspoken advocate for commercializing the distribution of software.”

James Wallace’s Overdrive: Bill Gates and the Race To Control Cyberspace book also noted in 1997:

“…Microsoft and IBM…in August of 1985…signed a long-term joint agreement that guaranteed the continuation of DOS and IBM…At the time, Gates said it was `the biggest contract’ Microsoft had ever signed…Microsoft had become the computer industry’s Standard Oil in the late 20th century…During…November 1989…Microsoft and IBM had jointly issued a…news release, titled `IBM and Microsoft expand partnership…’…FTC staff believed that the agreement between IBM and Microsoft smacked of anti-competitive collusion, and the investigation was on…”

The Microsoft Way book provided an example of how Democracy Now! Productions funder Glaser worked with IBM during his 10 years as a Microsoft “company man” and as Multi-Billionaire Gates’ “trusted lieutenant” during the 1980s:

“In late 1988, IBM executives told Microsoft they wanted to try once again to crack the home personal computer market…Gates suggested that the machine be equipped with an integrated CD-ROM drive and sound card…IBM accepted the suggestion…Gates assigned a team of Microsoft software engineers to work with IBM…Gates had assigned Rob Glaser to be his principal multimedia advisor…He was given senior responsibility by Gates soon after joining the company…Glaser suggested to Gates that Microsoft should launch what Glaser called a `virtual standard’ for multimedia that could be used in all-IBM compatible personal computers…Gates gave his approval…Gates…sent Rob Glaser…off on assignments to learn about new strategic problems--go figure it out’ was the injunction Gates would use—and then report back to him…”

Charles Ferguson’s 1999 book, High Stakes, No Prisoners, described how Microsoft had apparently increased its profitability and power during the 1980s and early 1990s, when Democracy Now! funder Glaser was a Microsoft vice-president:

“The ultimate source of Microsoft power is its monopoly control of the software platform used by PC applications—Windows… Microsoft even owns an equity stake in Apple, has rights to all of Apple’s intellectual property…and holds at least 50 percent market share in application software for the MAC…Microsoft…exploits its monopoly positions ruthlessly…Microsoft’s predatory behavior…, false dealings, and strategic use of monopoly power are integral to its ability to create further monopolies…”

And James Wallace and Jim Erickson’s Hard Drive: Bill Gates and the Making of the Microsoft Empire book had noted in 1992:

“…By mid-April of 1991, Microsoft was forced to acknowledge…that the FTC was looking into allegations that the company `has monopolized or attempted to monopolize the market for operating systems, operating environment, computer software and consumer peripherals for personal computers’…Microsoft has become notorious…not just for capitalizing on the technological advances of others, but, as some claim, for predatory pilfering. They complain that Microsoft repeatedly approaches small companies promising new products, ostensibly to talk about a partnership. After Microsoft is given a glimpse of how the software works, it suddenly loses interest in the deal—only to announce later that it has been working on surprisingly similar, but competing software…At the heart of the FTC probe is…whether or not Microsoft’s dominant position has chilled competition and thus hurt consumers…” (end of part 16)