3 Reasons Microsoft Settled Browser Dispute With The EU


Under the agreement Microsoft will provide owners of its Windows XP, Windows Vista and Windows 7 operating systems with a pop-up "ballot" screen from which they can choose one of a dozen Web browsers.

The agreement settles a year-long dispute over whether Microsoft's practice of shipping its Internet Explorer browser with Windows was anti-competitive.

So why did Microsoft come to an agreement with the EU so quickly, relatively speaking, compared to the earlier disputes it had with the EU over its server and media player products, which dragged on for more than a decade?

1. Stop Banging Your Head Against The Wall

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Microsoft apparently learned its lesson after those earlier battles with the European Union that resulted in lots of bad press, lost goodwill and fines totaling $2.44 billion, according to a figure in a New York Times article about today's settlement.

A quick glance at the Wikipedia entry for the earlier Microsoft-EC case shows what a torturously long dispute that was with Microsoft alternately saying it had provided the EU with what it asked for and criticizing the organization for what the vendor saw as it's heavy-handed approach. All the while the EU kept issuing additional fines against Microsoft for the delays.

That experience apparently led Microsoft to conclude that taking a similar, combative approach to the browser dispute just wasn't worth it. The original complaint filed by Norwegian browser developer Opera is only a year old and the EC launched its investigation, called a "Statement of Objections," on January 15 of this year. And Microsoft proposed the ballot-screen idea in July. Overall, a much speedier resolution compared to the past.

2. Join The Crowd

Maybe it's the increasing influence of the European Union in setting global antitrust law. Maybe it's the growing importance of the European market for IT vendors. But Microsoft joins a growing list of companies that are taking a more conciliatory approach toward their dealings with the EU.

Take Oracle and its recent promises to preserve the independence of the open-source MySQL database in an apparently successful effort to mollify the EU's concerns about Oracle's plans to acquire Sun Microsystems. Yes, Oracle CEO Larry Ellison did engage in a bit of rhetorical bluster against the EU for the delay. And true, Oracle's promises (including keeping the database's storage engine APIs public and allowing MySQL owners to extend their existing commercial licenses for five years) were hardly major concessions. Still, the resolution of the dispute was remarkably speedy.

Last week technology licensing company Rambus likewise settled with the EC by agreeing to lower royalties on some memory chips.

One exception to this trend is Intel, which is doggedly trying to reverse a $1.45 billion antitrust ruling against it by the EU. Good luck, Intel.

3. What, Me Worry?

Using the ballot screen Microsoft will provide to Windows users, consumers will be able to choose from among a dozen browsers. While that includes such well-known browsers as Mozilla's Firefox and Google Chrome (plus, of course, Internet Explorer), also on the list are Opera, Apple's Safari, AOL, Maxthon, K-Meleon, Flock, Avant Browser, Sleipnir and Slim Browser.

The New York Times article cites figures from French market research firm AT Internet that show IE with a 62 percent share of the European browser market in September, while Firefox has 28.4 percent, Safari 4.3 percent, Chrome 2.8 percent and Opera at 2.2 percent. "People already have this choice anyway," the article quoted AT Internet chief operating officer Nicolas Babin as saying.

Exactly. PC users in Europe who are more disposed toward using an alternative browser to IE are, most likely, already doing so. While the ballot screen may increase the number of consumers choosing an alternative browser, odds are that increase is going to be pretty small.