September 18, 2007
Microsoft vs the European Commission: Is it time to capitulate?
What more is there to say about the Court of First Instance’s landmark, historic, unprecedented etc etc ruling in the Microsoft case? Quite a lot, I fear. But given the avalanche of commentary and analysis that Monday’s judgement has already attracted, I will restrict myself to just one issue.
How will - or how should - Microsoft react to its thumping defeat at the hands of the EU’s second-highest court?
The group itself will certainly take some days or weeks to study the ruling before drawing any firm conclusions, but I would not be surprised if Microsoft comes up with a rather more radical response than we are used from the slow-moving software behemoth. After Monday’s devastating defeat, "business as usual" is simply not an option.
For a start, Microsoft is staring at a truly eye-popping fine for non-compliance that could very well end up somewhere north of €1bn. That would take the cost of the group’s legal battle with the Commission to almost €2bn just in terms of antitrust fines, not to mention lawyers’ bills and the billions Microsoft has dished out to rivals in private antitrust settlements. I know money is never a problem for the group, but surely at some point Microsoft shareholder will ask whether the group has no better use for its vast profits than to ease the plight of European taxpayers.
Then there is the reputational damage to take into consideration. Microsoft will not escape its image as the corporate world’s evil empire if it continues to be branded as an abusive monopolist which, even more damaging, feels free to ignore the orders of a government agency for more than three years. The disastrous news bulletins and front page stories over the past few days is likely to weigh more heavily on consumers’ minds than all the advertising and sponsorship of recent years put together. We should also not forget that the group does an awful lot of business with governments themselves - who may in future want to take a closer look at just how good a corporate citizen Microsoft really is.
In my humble opinion, this means the group should abandon its traditional response to the actions of the EU regulator. That consisted of moving a little bit into the right direction every other month, complaining loudly about infringements of intellectual property rights and otherwise making full use of its legal powers to fight back against Brussels.
For a start, there seems little upside in appealing Monday’s decision. The chances of success are slight anyway, and launching a further legal challenge would just reinforce the impression that Microsoft will not meet the regulator’s demands until it is too late. I know the group has every right in the world to appeal - but a more pragmatic response would be to desist.
Secondly, the group may want to consider a big announcement declaring that it will license its server protocols for free. If you look at the Commission’s statement of objections from earlier this year, it is clear that this is what Brussels wants anyway. Moreover, according to the independent monitoring trustee the Commission is right to take that stance, since there is next-to-no innovative value in the protocols. Why wait for the inevitable to be imposed when you can get some mileage out of doing it yourself?
Finally, Microsoft should start now drawing up clear, complete and accurate interoperability information about its Office suite. This is very likely to be the next battleground with the Commission - and with Brussels now firmly on the offensive (and help from the court nowhere in sight) the group would be well advised to take preventive action.
Vista is probably less of an issue for the immediate future - but here too Microsoft should listen very carefully indeed to what its rivals are saying. Unfortunately for the group, Monday’s judgement may mean that its competitors’ demands will keep on getting loader and broader.
What I am talking about, in one word, is of course: capitulation. Is that what Microsoft is obliged to do under European law? Almost certainly not. Is it fair? I don’t know. Is it the group’s best chance of bringing its nine-year antitrust nightmare to an end? Yes.
Your questions on Microsoft vs the EU answered by our expert panel
1) search engines for video/voice/data, 2) video/voice/data players on linux/java/ajax/your idea for mobiles and fixed , 3) 3d easy and open-source for all the kids, c’mon !!!! Europe can deliver great choices for all, including MS, Microsoft can never be more than 50-60%,never!,4) WiFi and Wimax ,cellular and White Spaces, cognitive radios and your idea, let the open-source creative machine start….open radios for all to call with ideas and opinions, like http://www.c-span.org/ radio and TV and others,
5) Europe needs a digital revolution, everywhere, all the time with natural foods and easy working conditions,Microsoft can be part of it or stay home with its neocon lawyers and obfuscated policies, they have a choice !what they dont want to give others,they get it from Europe and hopefully the Americas, if only “George” could learn about how to use a browser instead of just watching FoxTV from Murdoch all day and taking advice from neocon Bolten and his orthodox sidekicks Schumer and Mukasey, what a shame ! Europe moves forward,we must get the kids to learn easy 3d as well as camping and swimming, languages and “business starting” : every kid in Europe must learn to fix a bike, a guitar and a mobile phone as well as try to sell juice or food or art, a stand in a market or street to learn rejection , to learn to sell, to learn to take a “no” and fight for a yes ! this EU ruling is good stuff ! really good news !
and about search, even Google and Yahoo newsgroups/messages/boards are being taken under the neocon watch and with absurd partisan editing , what a criminal shame and insult against Free Speech in the USA! Europe must lead !
Posted by: blogger | September 20th, 2007 at 8:56 pm | Report this commentMicrosoft or any other company does not ‘own’ our data or what we produce. I REALLY don’t like it if my Word document is only 99% compatible if I use a different word processor. I want to get the document finished, not needlessly mess about with formatting MY work again just to make it presentable. MS doesn’t seem to mind playing these kinds of childish games.
If Microsoft continues to innovate and provide features that people want rather than the bloatware they roll out every year (come on, how many of us really use all those new fancy features in Office 3Billion&8?). Less clutter, smarter & faster software.
Open Sauce software will never(!) be as slick or as fancy as Microsoft products, but it gives people full control over their data. A lot of Open Sauce is very good, but far too ‘fiddly’ for most users.
How is it that companies like MS (and the other biggies) can’t patch security holes in anywhere near the time of the Open Sauce community (mozilla et al)? Don’t they have enough money or just the wrong managment and priorities?
Microsoft may see itself as the e-version of MacDonalds, serving up whatever it thinks is best to the consumer, but the consumer wants choice, usability and simplicity, or just something different (like BurgerKing).
MS has lost its way and needs to do some serious thinking.
Posted by: Aleks Bru | September 21st, 2007 at 11:28 am | Report this commentPersonally I have conflicting emotions regarding this matter. I think all of us have our beefs with Microsoft, whether it’s their unbridled corporate greed or the undesirable qualities of the IE browser. However, I feel trying to force a company to make available its hard won technological advantages to its competitors is absurd. If Microsoft’s competitors are incapable of developing competing technologies to challenge Microsoft’s dominance in the computer software market -I hardly think it is an appropriate solution for a government to basically legislate the theft of Microsoft’s proprietary business secrets -the end result of millions and even billions of dollars in r & d and the intellectual fruits of the geniuses that company employs.
Even in the interests of encouraging free market competition and -gulp- lower consumer prices.
The fact that Microsoft bundles its media player with its operating system is not something to which I find any objection. How is this stifling competition? If people don’t like wmp, they can easily download some other application like real player or Quicktime. Most media players are compatible with the windows operating system.
But, I do object to Microsoft’s practice of making it difficult for the average, less than tech savvy windows user to easily remove certain applications such as windows messenger from their computers. Or tricking windows users into downloading spyware such as windows validation tool under the guise of a critical update. The fact that windows is laden with bundled spyware and backdoors is something I most certainly would not mind seeing addressed in a court of law.
Another issue for me: Once I pay 200+ USD for my Windows Vista operating system, don’t tell me how I should use it. Here’s an example: If you install a new windows operating system on - say a used computer you bought off ebay, and then that computer dies in two weeks; try installing that operating system on another computer and see what happens. You’ll get 30 days to register this copy of windows. Of course, since you have registered this copy of windows on another computer, even when that computer is no longer in use, Microsoft will not allow you to re-register the software and will ask you to buy another activation key. If you don’t re-register your new installation of the software within 30 days or less, you will be locked out of your own computer.
And for anyone who thinks that Microsoft will provide you with a new, free installation key once you have explained your situation -good luck.
I would have no problem with legislation restricting Microsoft from such devious policies and practices.
But forcing Microsoft to share its proprietary code with competitors? I can’t get behind such a questionable precedent.
B.
Posted by: Brendan Scarborough | October 9th, 2007 at 2:18 am | Report this comment