After Antitrust

Malcontents

Massachusetts remains the only state that's actively fighting to overturn Judge Colleen Kollar-Kotelly's final judgment and the settlement, which took effect more than a year ago. Court-mandated reports filed since then show that Microsoft and the plaintiffs--the U.S. Department of Justice and a consortium of 20 states--have settled into a routine of review and modification that has yielded demonstrable changes in the company's products and licensing policies. Still, Massachusetts, foreign governments, and some competitors continue to press for stronger sanctions against the operating system monopoly.

Microsoft faces other challenges. The European Commission declared in mid-2003 that it might force Microsoft to yank Windows Media Player from Windows XP because Media Player allegedly competes unfairly with products from RealNetworks, Apple, and others.

Then in December 2003 RealNetworks filed its own suit against Microsoft, claiming that the software giant used its monopoly power to try to control the digital-media market.

And on a third front, Japanese authorities recently raided Microsoft offices in Tokyo in a search for evidence of unfair contracts with Japanese hardware makers.

As to fears that Microsoft will monopolize Internet search, Microsoft spokesperson Jim Desler says that current plans for upcoming versions of Windows focus on improving local PC searching, rather than on Internet searching. "We are dedicating the resources and committing the energy and time to make sure that we are fully compliant [with the settlement agreement]," Desler adds. He says he is not allowed to comment on the European Commission case.

Checking Up

Part of the settlement agreement called for the creation of a review panel involving all parties to the suit to make sure Microsoft does not engage in the abusive business practices that sustained its monopoly power. It's this group that files the court reports revealing the ongoing process of complaint, investigation, and changes in Microsoft products and policies (Click here for one of these court reports). Most recently, for example, Microsoft agreed to change a Windows Media Player music-shopping feature that persisted in launching Windows' Internet Explorer browser, even when the user had set another program as the default browser.

For Windows XP users, the most visible evidence of the settlement may be in the Set Program Access and Defaults interface that Service Pack 1 added to the Control Panel's Add or Remove Programs tools. This interface lets users and system vendors dictate what browser, e-mail program, media player, and instant messaging client the operating system will use--either Microsoft's own, or those from other software vendors. The tool can also make Microsoft's versions of those applications appear to vanish (though the underlying code remains installed).

"The consent decree has given Microsoft's competitors some breathing room and relief," says Laura DiDio, an analyst with the Yankee Group. But aside from the possibility of Microsoft offering rebates (see "Get Your Money Back From Microsoft") or incentives for choosing its software, individual customers are not likely to see tangible impact from the settlement, she adds.

DiDio believes the antitrust decision has led, indirectly, to larger discounts on Microsoft volume software licenses, notably in the small-business-oriented Open License program. But she doubts that individual Windows buyers in the U.S. and Canada will see discounts. DiDio suspects the European Commission's pursuit of Microsoft may be "a bit of a witch hunt" stemming from anti-American sentiment related to the war in Iraq. The Europeans could require Microsoft to bundle other browsers or media players with its software--a remedy that might be onerous for Microsoft, but no big deal to Windows users, many of whom already routinely use more than one player.

No Simple Solution

The antitrust case may have slowed erosion in the competitive landscape; at the least it's given Windows users more control over default apps.

But Windows remains the personal computer's dominant operating system. And for most of us, its dominance has meant coping with Windows security problems that the settlement was never intended to address--or even could. It's a problem that only Microsoft can solve.