Three Wise Men

A little while ago I was writing about Open Source Community, Microsoft, Computer industry in general and why open source is doing good. Today I’ll try to tackle latest development in what looks like a third browser war which is being fought in courts instead in the field – the market.

It wasn’t the first time that European Union tried to swing against Microsoft. First battles were fought more than ten years ago in 1997 and Novell complained even before that in 1993.  So, this has been dragging for quite some time now and not so long Microsoft was charged somewhere around US$ 2 billions because of their actions. European Commission (EC) also forced Microsoft in selling two different versions of Windows in EU region – one with Windows Media Player and one without it. Microsoft complied but they put the same price tag on both boxes. The end result was probably some face-palming inside EC, some grinning inside Microsoft and nobody actually buying the stripped down version of Windows.

Now people in EC got smarter and they are trying to outwit Microsoft. They decided that Microsoft should include other browsers in Windows Installation.

Continue reading if you want to know why I think that Microsoft should be sanctioned in some way, but I doubt that this is the correct way.

First we have to get few things straight. Microsoft is dominating desktop world. They pretty much cover a vast majority of desktop market share and this makes them special. It makes them more successful than anyone and it strengthens their position against any other competitor that might emerge on the same market. But! But because they are a dominant force they have to play by few rules that others don’t have to.

United States have a special act, called Sherman Antitrust Act which falls under antitrust laws. It clearly states¹:

“Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal …”

and:

“Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony”

Wikipedia will also tell what the definition of monopoly is:

“In economics, a monopoly (from Greek monos , alone or single + polein , to sell) exists when a specific individual or enterprise has sufficient control over a particular product or service to determine significantly the terms on which other individuals shall have access to it.”

What is the big deal with integrated browser? Well nothing wrong until you decide to use your big share on the operating system market to spread the use of your newly developed browser among people using your operating system. Bill Gates himself said, more than ten years ago, that integration was a way too gain market share for Internet Explorer, telling everyone that integration had other purposes beside improving operating system itself.

Why is that bad anyway? Simply because it kills competition. Who will install a different browser if they have one already installed? Why should they, especially if they are clueless users, inexperienced and undereducated about these things. They won’t care, bother or know, so they are hooked. Imagine now that you are charging money for your product while Microsoft is giving one for free already installed together with operating system. Making uninstallation impossible helps too. What Microsoft achieved is that a lot of people now consider Internet Explorer as internet and if there is no such icon on the desktop, then their computer is not equipped with internet. Sad. Bundling Internet Explorer with operating system was a bad idea since the beginning and Microsoft will now have to pay more and it will hurt them more.

Is this the death of free market as we know it? Doubtfully, true free market never really existed and it never will since it would probably kill itself. A regulation here and there will keep competition healthy and prevent cases where monopoly is abused and used for gaining market share on other markets and when customers suffer because of unreasonable prices and terms of use.

This is the core of the problem and the most mind boggling thing at understanding the whole situation. I’ll try to be as clear as possible.

Microsoft did not have a monopoly on browser market. It had and still has monopoly on desktop operating system market. They used this monopoly, their huge market share, to get rid of competition on the browser market. Their ability to provide every computer with pre-installed browser was a key in winning the first browser war. There was also price tag for Internet Explorer. It had none and was advertised as free. Of course people paid its development together with Windows, but that is sort of hidden and people don’t care about it. One price tag is better than two.

So, now everyone will start complaining. Calculator should go out, Notepad too, hell, even Minesweeper and Solitaire! Give other developers a chance. Luckily things are not as transparent as most of the people might think. Why should calculator and notepad stay bundled? Have you ever used them? For some serious work? Validating all the calculations for your Masters Degree in math and physics or notepad for writing computer programs? Ever tried that? Probably not since both programs suck, they are useless for any serious work and can be used only in some kind of an emergency. If Internet Explorer would suck and would be used only when really needed then nobody would complain.

Think of Internet Explorer as Lynx for Windows² and the real, full version of Internet Explorer could be added to Office package, similar what Microsoft did with Outlook Express and Windows Mail more recenlty. Stripped off, limited version is pre-installed, full version can be sold or given away separately.

Imagine what would happened if Microsoft bundled something that looked like Adobe Photoshop …

Bundling other browsers with Windows would be silly and would in fact confuse users. Besides, who will decide which browser gets bundled with Windows and on what basis?

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