
I have got to take issue with Ovum's take on the news that the European Commission has warned Microsoft that it has concerns about the bundling of new features into Vista.
Ovum software practice leader, David Mitchell seems to be suggesting that the EC should draw a line under its antitrust investigation into the software giant and move on, for the good of innovation.
The perspective appears to ignore one significant point, however: that Microsoft was found guilty of breaking European Union competition law in March 2004, and so long as its actions are not remedied, it continues to benefit from its illegal actions.
"The industry does not need another chapter in the epic saga of the EU's battle with Microsoft. Indeed, it needs to draw the existing threads of the various debates to a timely close," writes Mitchell, who asserts that the Commission taking time to investigate Microsoft is somehow damaging European software vendors' ability to innovate.
"The industry needs to focus on technological innovation and hard-but-fair competition. If the industry is continuously stopping to look over its shoulder, then it will spend less time developing great products and selling them to customers," he writes.
The logic of this escapes me, as does the somewhat bizarre suggestion that because Microsoft has nearly finished Vista (although not nearly enough) the operating system should somehow be allowed to escape investigation.
"Asking for modifications to be made to software is best done at its design stage, not when the product has been in technical development for many years. It becomes progressively more costly to fix software as it nears completion - up to 100 times more expensive. If the EU wishes to have a deeper regulatory role in the software markets, it would be much more effective to intervene at the product design and conceptualisation stages," he writes.
If an epic saga is something you want to avoid, then suggesting that regulators get involved in product design is probably not the way to go about it.
The question seems to be whether the EC should be considering investigating Vista at all. In this regard it is important to remember that Microsoft was found guilty of breaking European competition law by using illegal tactics to maintain a monopoly.
Among the remedies was a requirement to unbundle certain software and share interoperability information with competitors. Microsoft continues to appeal against these remedies - as is its right - but until it is cleared it must abide by them, with both existing and forthcoming products.
It's also worth noting that, according to the European Commission, it only sent its recent letter to Microsoft in "response to a request from Microsoft for the Commission to clarify its concerns as regards Vista," which indicates that Microsoft is, in this regard, abiding by the Commission's rules.
There is another reason why the Commission is right to continue to investigate Microsoft's software developments, however: the company continues to benefit from its monopoly position.
An example of this came from details presented by Bristol City Council about its plans to move from a variety of office productivity applications to Sun's StarOffice.
"Our biggest challenge was encouraging staff to be open-minded about anything that wasn't MS Office. Microsoft has become so dominant and ubiquitous that the default assumption for many people is that everything else is inferior and that the only way to accomplish work is to do it in the exact way that an MS Office product does it," explained Gavin Beckett, Bristol City Council’s IT strategy manager.
The reason Microsoft has gained this position of ubiquity - whether its functionality is better or not - is because it has a monopoly, and a monopoly that was maintained illegally.
The move to StarOffice was originally expected to produce cost savings of 1.4m pounds ($2.4m) over five years, compared to Office. That figure has now dropped to £1m, despite the level of spending on StarOffice staying the same.
How could that be? A Bristol spokesperson explained that the cost saving was not as much as originally estimated as Microsoft had reduced its offer in a bid to keep a toe in the account. While the fact that the company is prepared to drop its prices is good for consumers, it must be remembered that the fact that it is in a position to do so is due to the fact that it has a monopoly, and a monopoly that was maintained illegally.
In fact, the reason Microsoft is in a position to draw out its battle with the European Commission for so long is because of that monopoly.
Few other companies would be powerful enough to debate with the Commission about which competitors it should be forced to share interoperability information with, having decided that open source companies should not count.
Few other companies would be powerful enough to call into question the neutrality of the monitoring Trustee - a man it helped choose - for "collaborating" with its competitors when he has been specifically tasked with gathering "views on compliance issues through contacts not only with Microsoft engineers, but also with potential beneficiaries of the remedy."
Few other companies would be powerful enough to license its source code to developers and competitors and offer unlimited free technical support rather than do what the Commission has actually asked it to do, which is provide adequate technical documentation.
These are all reasons why the EC needs to continue to investigate Microsoft's developments closely and insist that the company continue to stick to the antitrust remedies. To suggest that the EC should somehow just draw a line under the whole thing and we should all just move on is to undermine the whole point of competition law.