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Filter - Cynthia L. Webb
Microsoft's Bundle of Trouble


_____From The Post_____
EU Says Microsoft Settlement Talks Fail (The Washington Post, Mar 18, 2004)

_____Filter Archive_____
Chipping Away at China's Trade Policy (, Mar 19, 2004)
Outsourcing Debate Turns Spicy for Powell (, Mar 17, 2004)
Antitrust Tide Turns Against Microsoft (, Mar 16, 2004)
Brussels Sprouts a Microsoft Ruling (, Mar 15, 2004)
Seeds of Oracle's Antitrust Defense (, Mar 12, 2004)
More Past Issues

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Microsoft can't be looking forward to next week. A European Union competition panel is "expected to endorse a fine of hundreds of millions of euros against Microsoft, although not until a second meeting scheduled for 22 March. The Commission's final decision will be made on 24 March," said BBC News Online, which continues to run a picture of a wincing Bill Gates a key to its ongoing coverage of the antitrust flap.
BBC News Online: Microsoft Facing Competition Fine

So what's the big deal about bundling? Microsoft has repeatedly made clear that it is unwilling to give ground on the issue, as today's Washington Post notes in an article written before Monti's announcement. The Post noted that Microsoft has argued that producing a version of its software that does not include its Windows Media Player would be "technically difficult and would harm the interests of consumers, who find the multiple functions of Windows useful." The other side sees it very different, as the newspaper explained: "Since Windows' release in 1985, Microsoft has steadily added new features to the operating system, such as Internet browsing software and the media player. Because Windows is used on most personal computers in the world, critics say that including these new features unfairly disadvantages other companies that sell similar software -- RealNetworks in media players, for example. People won't buy their software, the logic goes, if something similar is a standard feature on Windows."
The Washington Post: Microsoft Continues Talks in Europe (Registration required)

Filter Reader's Crystal Ball

When I wrote about the antitrust case earlier this week, reader Darren Bush, an assistant professor at the University of Houston Law Center, sent this e-mail: "I have not made up my mind quite yet whether the EU remedy will be effective. Forcing Microsoft to offer two versions (one with the media player and one without) might be problematic. It is akin to competing with yourself at a game of checkers: You know well in advance which side is going to win, no matter how fair you attempt to be in your play. Allowing Microsoft to set up the terms of competition among its two products will eventually lead to consumers seeking the integrated windows version as Microsoft hamstrings the other version. And Microsoft may have tremendous incentive and ability to hamstring the stripped version, depending on the language of the Commission's final order."

Microsoft's Mea Culpa

Meanwhile, back home in the states, Microsoft is hoping to nix one of several remaining antitrust cases by showing its human side. The Los Angeles Times noted that "[d]espite settling antitrust lawsuits with the Justice Department, corporate rivals, more than a dozen states and millions of consumers, the company's representatives have never apologized for its rapacious behavior. That streak ended in Minneapolis, when a Microsoft attorney conceded to a jury that the company had been overly aggressive in defending its turf. A Microsoft attorney conceded to a jury that the company had been overly aggressive in defending its turf. 'Yes, we acknowledge that and we apologize for it,' lawyer David Tulchin said. Though he insisted that no laws were broken, he acknowledged that "the conduct involved competition that went over the line," the article said. The Associated Press completes the quote: "The conduct involved competition that went over the line. The question for you is whether or not consumers were overcharged." Now, don't hold your breath for an apology of this sort across the pond.
The Los Angeles Times: Facing Jurors, Microsoft Voices A Rare Mea Culpa (Registration required)
The Associated Press via The Seattle Post-Intelligencer: Microsoft Offers An Apology For Past Practices
Minneapolis Star Tribune: Microsoft lawyer: No Harm, No Foul
St. Paul Pioneer Press: Microsoft Testimony Begins

A Microsoft Step Forward on Security

In an effort to ramp-up the security of its products, Microsoft yesterday put out another version to update its Windows XP operating system. The update "includes several significant changes from the test version released last year. RC1 versions of software releases are typically bridges between the beta and the final release, incorporating changes based on tester feedback. The final version of SP2 is set for release in the second quarter of this year," CNET's reported
CNET's Windows XP Service Pack Gets Face Lift

Spotlight on Cebit 2004

Cebit, Europe's big annual electronics expo, kicked off last night in Germany. Expect a slew of interesting tech products to be unveiled. "This year some of the bullishness of previous years has returned thanks to the growing success of wifi, renewed interest in mobile phones and the growing role of the PC as the heart of the digital, hi-tech home. Also on show will be the usual slew of nifty gadgets including a paper computer, a camera lens that works like the human eye and a Swiss army knife that doubles as a portable memory card," BBC News Online reported.
BBC News Online: Gadgets Galore On Show At Cebit

ZDNet UK said this year's show, which was started with a keynote by German Chancellor Gerhard Schroeder, has higher security than in the past, "following last week's terrorist attacks in Madrid. Regular show visitors have noticed a large increase in the number of police officers patrolling the Hannover show ground," the article said.
ZDNet UK: Tight Security, The Chancellor, And The Mechanical Man

Microsoft's Video Play

Microsoft used Cebit to introduce a handheld music and video player. "The first handheld gadgets to play music and movies on Microsoft's 'iPod killer' software will be available in Europe in the second half of 2004, the company said Thursday. ... The gadgets will run on Microsoft's yet-to-be-unveiled Portable Media Center software in a direct assault on iPod, Apple's hot-selling digital music player," Reuters reported. The International Herald Tribune said Microsoft hopes the new plans "will give it an edge against Apple and others in the market for portable media devices. At the same time, Sony stepped into the potentially lucrative market for hand-held media players, announcing details for a pocket-sized music-only gadget and its new online music service, called Connect."
Reuters: Microsoft: Europe 'iPod Killer' Debut In 2nd Half of '04
International Herald Tribune: Microsoft Takes On Apple

More details on the new Microsoft gadget from BBC News Online: "The Portable Media Center has an operating system which is similar to Microsoft desktop Media Center software and uses Windows media. It will also play MP3 files. It will synchronise with a Windows XP computer to transfer video, music or photos. A device with a 40 gigabyte hard drive would be able to hold 175 hours of video, 10,000 songs or 100,000 pictures. The battery would last long enough to let you watch one of the three-hour instalments of the Lord of the Rings film trilogy or listen to 12 hours of music."
BBC News Online: Microsoft Eyes Video In the Hand

AOL on the Chopping Block?

America Online might be looking for a new home by the end of the year. "People familiar with the thinking of Time Warner Chief Executive Richard Parsons say one of his top priorities this year is to evaluate whether keeping the online-services unit makes strategic sense for the media giant," The Wall Street Journal reported today. "People familiar with the situation say Time Warner hasn't made a firm decision on AOL's future, but it is in the midst of its annual strategic-planning process in which it evaluates all its businesses."
The Wall Street Journal: AOL Moves To Owner's Front Burner (Subscription required)

The Journal article follows a piece in The New York Post yesterday, which indicated a sale of AOL could be in the offing. "Time Warner is considering strategic alternatives for its America Online (search) division, including a possible sale, spin-off or a significant restructuring of the business," the newspaper said yesterday.
The New York Post via Time Warner Mulling Sale of Spin-Off of AOL

An Inside Job?

Hollywood has been working fast and furiously to battle the online pirating of movies, but it turns out Asian piracy rings aren't the only ones to blame. "Two employees of Fox Entertainment Group have been terminated after the company's discovery of illegally downloaded movies and software on a Fox computer network server. The titles found on the server included 'Bringing Down the House,' 'Daddy Day Care,' 'Old School,' 'Daredevil,' 'Deliver Us From Eva,' 'The Matrix Reloaded' and 'X2: X-Men United,'" The Los Angeles Times said in an article that cited a report from The Smoking Gun Web site.
The Los Angeles Times: Fox Files 2 After Finding Film Downloads On Servers (Registration required)

The Wall Street Journal said the "incident is particularly embarrassing for Fox, which among the studios has taken one of the most strident stances in Hollywood's crusade to halt piracy before it ravages the film business as it has the music industry. News Corp. President Peter Chernin has been a strong voice in favor of strong antipiracy measures."
The Wall Street Journal: News Corp.'s Fox Fears Piracy Ring Began Internally (Subscription required)

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