Print 80 comment(s) - last by FITCamaro.. on Oct 26 at 9:24 AM

Regulators don't buy Microsoft's excuses about a "technical error"

It had seemed that Microsoft Corp. (MSFT) and the European union had finally resolved their differences when it came to antitrust issues.  Microsoft agreed that it would offer a special "ballot screen", which would give users the choice of multiple browsers when they first installed or used Windows 7 -- and as a result, third-party browser makers would be on a level playing field and face no "bundling" discrimination.  The EU asserts its claims were validated, as the ballot screen appeared to cause a large drop in Microsoft's EU browser market share.

But that fragile true has been shattered when Microsoft went back on its promise, and stopped offering the ballot screen -- temporarily -- with the rollout of Windows 7 SP1.  Microsoft in past comments has blamed the abandonment of the option on an undisclosed "technical error" in the update.

EU regulators are unsympathetic.

This week they announced a so-called "statement of objections" -- a procedural step serves as a warning of impending punishments.

The EU's antitrust regulator, the European Commission writes:

The European Commission has informed Microsoft of its preliminary view that Microsoft has failed to comply with its commitments to offer users a choice screen enabling them to easily choose their preferred web browser. In 2009, the Commission had made these commitments legally binding on Microsoft (see IP/09/1941)....

In its statement of objections, the Commission takes the preliminary view that Microsoft has failed to roll out the browser choice screen with its Windows 7 Service Pack 1, which was released in February 2011. From February 2011 until July 2012, millions of Windows users in the EU may not have seen the choice screen. Microsoft has acknowledged that the choice screen was not displayed during that period.

Browser Ballot Box
Microsoft's Windows 7 Service Pack 1 "accidentally" turned off the browser ballot box.
[Image Source: Telegraph UK]

It's hard to say what, if anything, Microsoft can do at this point to avoid punishment for "accidentally" breaking its agreement with the EU.  One important thing to note, though, is that the precise punishment has not been announced.  Thus it is probably in Microsoft's best interest to provide sound technical evidence (if it has it) supporting its assertion that the ballot screen was turned off on accident.

The company faces tough questions, in the sense that even if it's telling the truth about the initial error being accidental, that it's hard to believe that the company wouldn't notice the ballot screen being gone for a full year.  Add to that the background that Microsoft had seen its market share disintegrate after the browser screen went live, and the picture painted is rather incriminating.

Microsoft has struggled in the past with the region's stricter antitrust laws.  It recently lost its appeal to vacate a €899M fine, although the EC did kindly reduce it to a mere €860M ($1.1B USD).  The software giant has paid close to $2B USD in total fines to the European union for antitrust offenses.  

Microsoft is also being investigated for API abuse, following claims by third party browser makers that they were being "excluded" from the ARM-architecture-compatible version of Windows 8.

Source: EU

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If I was MS
By Sazabi19 on 10/24/2012 12:50:11 PM , Rating: 4
I would tell the EU to shove it or sit and spin. This is ridiculous that they have to make a huge deal over IE on it. Use IE to download whatever other explorer you want and STFU. What are they going to do if MS refuses to comply and refuses the fines, stop selling it to them? Guess how long that would last before the EU realizes they aren't going to go to Linux overnight.

RE: If I was MS
By Stephen! on 10/24/2012 1:14:23 PM , Rating: 1

Why shouldn't they be punished? This is a company that supposedly values integrity and honesty, yet they violate an agreement with the EU.
Our Values: "we value integrity, honesty"

RE: If I was MS
By FITCamaro on 10/24/2012 1:26:38 PM , Rating: 5
Why should they be forced to do anything with THEIR product that they don't want to? Did the EU put any time or money into the development of Windows? No. So what right do they have to say it has to offer choices for other browsers. This is what you get from organizations like the EU. Does IE being pre-installed harm anyone? No. Do they force people to use it? No. Do they stop anyone from installing another browser? No.

This is a cash grab. Nothing more.

RE: If I was MS
By Cheesew1z69 on 10/24/2012 1:35:48 PM , Rating: 4
Why should they be forced to do anything with THEIR product that they don't want to?

RE: If I was MS
By othercents on 10/24/12, Rating: 0
RE: If I was MS
By andrewaggb on 10/24/2012 2:40:44 PM , Rating: 5
If I ever hear this again... Netscape went out of business because their browser wasn't as good.

That's the only reason I switched. And these days I run chrome/ff/ie, because I can. This time I'm in Chrome. And I didn't need a ballot, thanks.

RE: If I was MS
By NellyFromMA on 10/24/2012 2:51:35 PM , Rating: 4
Maybe Netscape went out of business because their business model made no sense.

Honestly, browsers aren't paid products. WHY IS THIS EVEN AN ISSUE?!?!

RE: If I was MS
By JasonMick on 10/24/2012 3:52:48 PM , Rating: 2
Honestly, browsers aren't paid products. WHY IS THIS EVEN AN ISSUE?!?!
That's technically accurate, but slightly misleading.

Browsers do earn their makers tens, if not hundreds of millions of dollars, as search engine firms pay to place their engine as the default search built into the browser.

Thus browsermakers like Mozilla, Google, or Microsoft do make big money off their browsers the same way as anything else on the internet -- by search/advertising.

I don't agree with the EU's decision, particularly when Apple and Google don't have to offer ballots on their products....

But it also would be wrong to think that browsers are made out of some sort of puppies, kittens, and happy hippie thoughts. They're a profitable product.

RE: If I was MS
By mike66 on 10/24/12, Rating: 0
RE: If I was MS
By Gurthang on 10/25/2012 9:32:11 AM , Rating: 3
Wrong, double wrong with extra crunchies.

Any bundling of Netscape Navigator that you may have eperienced with your install of Windows 95 was done by the OEM who customized the 95 install for the PC you bought from them.

As to Microsoft "stealing"... The orginal Netscape Navigator was made by a former NSCA Moasic developer and hence it borrowed heavily from design of Moasic though no code was "copied" or shared between them but you can bet most of the orginal code was built on ideas devised in Moasic. Internet Explorer 1.x was built from code bought from Spyglass which was built from NSCA Moasic. So while I am sure in the great feature battles of the first browser war both sides borrowed and stole ideas bot browsers actually are related hence the similarities. Things started going in IE's favor around IE3 though mostly because Netscape got a reputation of being buggy.

While MS's IE contributed to Netscape's demise they were a victim of a bad business model. Basically the browser as a paid for application was never going to work and they knew it s they gave the betas away for free which ment everyone just hoped from beta to beta. Netscape made far more money from their web server software at first but Sun kicked their butt on the high-end and the "free" web servers like IIS started eating them up on the low end. Resulting in diminishing profits and ultimatly a buyout by AOL who mostly used Netscape as a bargining chip with MS to get a better deal with the whole IE integration in AOL. As management styles clashed between AOL and Netscape employees got things got worse and most the the talent jumped ship. The rest is history.

RE: If I was MS
By NellyFromMA on 10/25/2012 10:20:44 AM , Rating: 2
Obviously I do not think browsers are made of kitties...

However, lets call it what it is. The EU would rather have another company be at the forefront of the internet other than Microsoft. Especially if they have EU roots.

These competitors are upset because they want to latch of their competitors success to supersede Microsoft's presence in the market place. It's justification is lackluster at best; anything but kitties.

RE: If I was MS
By Solandri on 10/24/2012 11:36:46 PM , Rating: 2
Netscape went out of business because their browser wasn't as good.

No it didn't. Netscape's business model made sense initially. You had to buy Netscape for something like $20, which given the huge amount of information available via the web was a paltry admission fee.

Then Microsoft bundled IE for free with Windows, pulling the rug out from under Netscape. That's why Netscape went under - because the company which controlled most of the desktop market made it impossible for the company with most of the web browser market to sell its product.

Microsoft did this because they perceived Netscape as a threat to Windows. The browser represented an OS-agnostic user experience. You could see the same web pages and run the few early web apps on a computer running any OS. If the browser became the next desktop, then Microsoft's near-monopoly of the desktop OS was doomed. Why pay $100 for Windows when you could get the same thing for free with Linux? So they did everything they could to kill it or wrest control of it (even adding their own proprietary web page standard which would only render on Windows, which defeats the whole purpose of the web). The same thing happened years later with Java - same threat, same response (proprietary extensions), with Microsoft eventually removing native Java support from IE.

Later iterations of Netscape weren't as good because they had no income with which to improve their product. Microsoft meanwhile was subsidizing IE development with Windows and Office sales. Netscape ended up having to sell themselves (a stock swap actually) to AOL to avoid bankruptcy. And AOL tried to turn it into a portal rather than a simple web browser, which was when it really started sucking.

Yes eventually Firefox broke IE's stranglehold, but Firefox didn't happen in a vacuum. First, Microsoft allowed IE to stagnate once they eliminated Netscape as a threat. They weren't interested in actually advancing the browser, they just wanted to make sure it didn't threaten their OS. After Netscape was pretty much gone, there was about a 13 month period just before Firefox's initial release where IE received no new features, only security upgrades. Second, the Mozilla foundation gets large amounts of money from companies interested in a less OS-dependent computing experience, primarily Google. So Firefox development could "compete" on an even footing with IE's development - subsidized.

Remember that any time you think getting the browser for free was good. Web browser technology today is about 13 months behind where it should be because Microsoft used its desktop OS monopoly to eliminate the browser competition; not because they wanted to build a better browser, but because they just wanted less competition. Who knows how many years further behind it is than it would've been if browser companies had been able to sell it like most other productivity software.

RE: If I was MS
By raddude9 on 10/25/2012 5:09:05 AM , Rating: 2
Thanks Solandri, that's an awesome answer.

RE: If I was MS
By GatoRat on 10/25/2012 2:50:06 PM , Rating: 3
Your history isn't entirely accurate.

Netscape initially charged nothing. It was only AFTER IE shipped that Netscape started charging $10 per copy. They were widely criticized for this and quickly changed to charging only corporate customers.

Moreover, Netscape was awful. It leaked memory like crazy and would often crash and/or consume all of memory or CPU just sitting doing nothing. Developing for Netscape was a nightmare. Perhaps this, more than anything, made IE so welcome.

Netscape pointedly refused to modernize their browser and embrace emerging web standards. To say they were intransigent is an understatement.

RE: If I was MS
By raddude9 on 10/26/2012 4:50:09 AM , Rating: 2
your history on the other hand is entirely inaccurate.

v1.0 of Netscape Navigator was only free for educational and non-profit organization use as were the many following versions. The only versions that were entirely free were the pre-release versions.

Sure Netscape leaked memory and crashed a lot, but so did the early versions of IE.

I have absolutely no idea what you mean by
Developing for Netscape was a nightmare

And what are you talking about when you say:
Netscape pointedly refused to modernize their browser and embrace emerging web standards

Because Netscape were busy giving us useful new and open standards like Javascript in v2.0, while microsoft were busy trying to hoist proprietary and closed languages like VBScript on us. In case you have amnesia, all browser makers back then were 'bending' the standards to make the web more useful, but at least they weren't trying to tie the web to single OS like microsoft was.

RE: If I was MS
By Cheesew1z69 on 10/24/2012 7:36:38 PM , Rating: 3
It's THEIR OS, they can put whatever they want into it. As for choice, there was choice.

RE: If I was MS
By StevoLincolnite on 10/24/2012 10:55:23 PM , Rating: 1
Unfortunately, when you release a product in an overseas territory, you need to abide by it's laws and regulations.

If the EU mandated that all of Microsoft's products must be a bright fluorescent pink, then Microsoft has to do it if it wishes to sell it's product in that territory, regardless if us, the consumers like it or not. :(

RE: If I was MS
By Solandri on 10/24/2012 11:47:34 PM , Rating: 1
It's THEIR OS, they can put whatever they want into it.

You cannot leverage a near-monopoly in one market to create an advantage for yourself in another. If Ford owned 90% of the automobile market, and decided to change the engine so it would only run on Ford-patented fuel, they would come under anti-trust investigation for it too.

But all this was relevant a 10-20 years ago. IE use is now under 50% and this is no longer the case. Any damage which was done has been done and can't be undone at this stage. So there's little point continuing to force Microsoft to allow users to choose their browser upon initial bootup.

RE: If I was MS
By Sazabi19 on 10/24/2012 1:43:28 PM , Rating: 3
EXACTLY the point I was trying to get at in the 1st post FIT. This is stupid and if the EU doesn't like it then maybe they should make their own OS that they can use.

RE: If I was MS
By gamerk2 on 10/24/12, Rating: -1
RE: If I was MS
By Sazabi19 on 10/24/2012 2:25:21 PM , Rating: 2
No, IE is losing market space to Chrome and Firefox, that doesn't sound like it me. It's not anti competitive to bundle your own stuff, it's not like they lock it to where you can use only IE, then it would be. This is just anti-MS BS. I use Chrome because I like it more, IE is my way of downloading Chrome, nothing wrong with a default browser on your own OS. I used netscape back in the day, didn't care for it, liked IE better, now I like Chrome better. It sounds like you are hopping on that "give me" train.

RE: If I was MS
By Solandri on 10/25/2012 12:00:02 AM , Rating: 2
It's not anti competitive to bundle your own stuff, it's not like they lock it to where you can use only IE, then it would be.

The problem with bundling isn't that it prevents other software from being installed (it doesn't). The problem is that it prevents other software companies from having a viable business model. It's hard to compete with free when your main competitor is only able to give their product away for free because they're making fistfuls of money off of another product.

The free market only works when there is sufficient competition. So actions which eliminate competition across an entire market (such as giving a browser away for free) should always be scrutinized closely.

RE: If I was MS
By kleinma on 10/24/2012 3:29:35 PM , Rating: 2
So where the fuck is the browser ballot on iPads? Where is my browser ballot on android? Browsers are becoming synonymous with the OS you are running. IE claims something like 50% of the desktop browser market world wide, so it seems like the powers that be in europe think their citizens are just to stupied to get something else if they want something else. We have no ballot in the US, and I see a huge mix of various browsers.

While they are at it wasting time, they might as well go after google for their attempt at browser dominance by sneaking the chrome install into just about everything you do with google. Hell slap iTunes with some balloting too. Adobe and their damn monopoly on PDF readers!!!

RE: If I was MS
By corduroygt on 10/24/2012 2:01:50 PM , Rating: 2
They are not forced to do anything. Microsoft can stop selling in the EU if they don't want to play by EU's rules. Obviously paying the fines is a lot cheaper than the profits that would be lost by not selling in the EU, so MS goes along with it and pays the fines.

RE: If I was MS
By FITCamaro on 10/24/2012 4:59:19 PM , Rating: 5
Yes because a company should be forced to choose not to do business due to ridiculous decisions by greedy politicians who are also hypocritical since they have done absolutely nothing to Apple who has nearly 100% dominance in the media player market and over 80% dominance in the tablet market. Where are the mandates that Apple open up its OS to allow competitors to iTunes, iMovie, Safari, etc?

Oh right we'll just ignore all that because we have to get that big, bad Microsoft. You're a tool. The worst part is you don't even realize it.

RE: If I was MS
By corduroygt on 10/24/2012 11:21:25 PM , Rating: 2
It's capitalism buddy. If you can make a profit, you'll sell your product in that market. MS isn't run by fanboys, and any idiot who'd pull out of Europe and forego billions of dollars of profit every year would be fired on the spot.

RE: If I was MS
By corduroygt on 10/24/2012 11:22:09 PM , Rating: 2
And Apple gets away with it because they don't sell their OS standalone to run on any hardware.

RE: If I was MS
By FITCamaro on 10/25/2012 7:01:33 AM , Rating: 2
I wasn't the one saying they should either comply or leave. You were.

No it is not capitalism when some companies are unfairly targeted for supposed monopoly behavior. Did Microsoft use IE to stifle competition in the past? Yes. And they were already punished for it. But today, that is no longer the case. Today there are several major browsers.

Windows 7 does not integrate any core functionality into IE. In the past it was the only way to go get updates. That has long not been the case. Windows works perfectly fine without IE today. Having a browser selection screen does not do anything that people cannot do with their own brain. Those who would already not use IE aren't going to use it because they don't have a screen at install giving them a browser choice. Not bundling a browser with Windows would be absurd. Any operating system does that.

RE: If I was MS
By corduroygt on 10/25/2012 9:01:00 AM , Rating: 1
It's the democratically elected EU politicians who are imposing the will of the people. You have a problem with democracy when it doesn't go the way you want?

If it weren't for them, half the web would be ActiveX only by now...

RE: If I was MS
By raddude9 on 10/24/12, Rating: -1
RE: If I was MS
By NellyFromMA on 10/24/2012 2:56:11 PM , Rating: 2
Yes, it is strange when the law of the land is one-sided, biased, and not sensible. OS X offers no ballot screen. Android nor iOS do either.

Add to themix the fact that browsers are not paid-for products and its quite clear what the motivations behind these money grabs are.

Attempts to justify it simply do not stand up to the facts of common sense, independant of laws written.

RE: If I was MS
By raddude9 on 10/24/2012 4:11:42 PM , Rating: 1
So is it common sense to allow microsoft to dominate and manipulate internet standards with the sole purpose of perpetuating their windows monopoly, because that's what they were doing until governments got tough on them.
How about the benefits of browser competition to consumers, is it not common sense that healthy browser competition is good for consumers.
But then again I'm talking about common sense for people, not for corporations.

RE: If I was MS
By FITCamaro on 10/24/2012 5:05:59 PM , Rating: 2
You have no logical argument that there isn't competition in the browser market. In the time of so-called dominance, two major competitors to IE have arisen and stolen huge chunks of IE's market share.

Chrome now leads the browser pack. And Firefox is just behind IE's marketshare. Those figures get worse for IE every day.

This is not about browser share. This is about money. Pure and simple. After this next they'll find some other BS that Microsoft is doing that they don't like that they can fine them for. All while ignoring the FAR more closed architecture of Apple's computers.

Maybe I should move there and file a complaint with the EU that I can't build my own computer and put Apple's OS on it. Clearly anti-competitive for other's who want to build computers with Apple's OS on it. Somehow I don't think you morons would agree with that lawsuit.

RE: If I was MS
By raddude9 on 10/25/2012 4:42:01 AM , Rating: 1
LOL. You have no argument that the competition in the browser market was not facilitated by government intervention. When the EU started looking into the current case in 2004, microsoft had 91% of the browser market.
Without government oversight microsoft would have continued to use their position to bully competitors and buy their way to the top of the browser pile.

This is not about browser market share. This is about protecting consumers from a company which has, time and again, been shown (in court) that it has abused its monopoly position.

RE: If I was MS
By FITCamaro on 10/25/2012 7:14:48 AM , Rating: 2
Yes because Mozilla wouldn't have created Firefox but for the EU. Google wouldn't have been founded and created Chrome but for the EU.

About the only good thing that the US government and the EU did was force Microsoft to make IE less integral to the operating system, namely Windows Updates.

Even before that happened though, you could use other browsers on Windows just fine. In college when Firefox first came out, I started using it and the only reason I ever used IE was to run Windows Update when putting together a machine. A lack of some screen letting people pick a browser didn't stop anyone from using another one. User stupidity is not an excuse to fine a company.

The craziest part of it all is that now because of this increased competition, IE is actually becoming a pretty good browser. IE9 actually uses less memory than Firefox. Reviews of it give it pros and cons to other browsers rather than just all cons. I really only stick with Firefox due to it just being what I've used for the last decade.

The only reason I ever use IE is because my work is developing a web application that has to work in IE7 due to the governments horrible adoption rate for new technology. So I have to test in IE9 in IE7 mode or boot up a VM to run XP so I can test in native IE7. Luckily the IE7 mode in IE9 is 95% accurate to native IE7 behavior because I hate having to run a VM.

RE: If I was MS
By raddude9 on 10/25/2012 8:32:15 AM , Rating: 1
Sure, the EU didn't invert Firefox or Chrome (WebKit really), but they did create an environment in which they could flourish. And as you say, this led to improvements in IE as well, so because of these government actions (both EU and US) the consumer has greatly benefited.

We're not quite out of the woods yet, as you mentioned, many web sites were created to work just on IE, (often using microsoft proprietary ActiveX controls and the like) but at least it's headed in the right direction.

RE: If I was MS
By FITCamaro on 10/25/2012 2:29:25 PM , Rating: 2
Show me a website today that still depends on ActiveX controls. Sure there are internal company and government sites that do. But I mean the general web.

Firefox and Chrome would have flourished regardless of whether IE had changed or not. People simply would have still used another browser for general web browsing while only using IE when absolutely necessary. Some of you guys must be working with the Obama campaign with how you love to credit government for solving problems and businesses creating things.

RE: If I was MS
By raddude9 on 10/26/2012 4:34:20 AM , Rating: 2
As you say, there are still many internal and government web sites that still rely on ActiveX, and there aren't many general web sites that rely on it now, but there used to be many, because microsoft wanted to circumvent the open standards and cause websites to only work 'properly' on its own operating system. Without oversight of microsoft this might not have been the case today.

Firefox and Chrome would have flourished

You can't prove that they would have flourished without government intervention, all it would have taken is some dirty API tricks (like they've pulled many times before) from mircosoft and it would have made alternative browsers a lot less attractive.
Sure try to bring Obama into an argument that has nothing to do with him. microsoft have a history of breaking the law, and they have shown that they need to be monitored by ALL governments (not just Obama and the US government) to ensure that they adhere to the law.

RE: If I was MS
By FITCamaro on 10/26/2012 9:24:18 AM , Rating: 2
You can't prove that they wouldn't have either.

RE: If I was MS
By vXv on 10/24/2012 6:23:53 PM , Rating: 2
There is no law mandating a bailout screen. The law simply says that you are not allowed to leverage a dominance in one market to gain control over another market (like MS did from the OS to the browser market).

The bailout screen is just an agreement MS did with the EU to avoid fines. And now they did not comply by not having the screen for almost a year ... hence the EU is upset.

RE: If I was MS
By NellyFromMA on 10/24/2012 2:50:06 PM , Rating: 2
It's not Microsoft's responsility to enable its competitors to destroy it. The EU ruling was one of the single most harfmul things that happened to MS, and largely its an issue of perception.

There was no discrimination towards any other browser unless there is similar discrimination in the fact that competitors devices do not offer similar ballot screens as well. OS X does not, iOS does not, Android does not. So tell ME where teh integrity and honesty is! Also, tell me what country(s) stand to gain the most from this ruling.

Honesty and integrity have NOTHING to do with it. Greedy EU regulators who are overspent and green-eyed. Thats all.

Maybe MS SHOULD ignore the EU... From a business standpoint, I doubt they could truly survive, but it would be funny to see if Mozilla and family fill in the OS gap as a result and where THERE ballot screen would be.

It's BS and for whatever reason truly upsets me.

RE: If I was MS
By mike66 on 10/25/2012 1:30:55 AM , Rating: 1
Having no knowledge of the issue is what's upsetting you, MS needs to be regulated and heavily because they are theives who have never created anyrhing, GUI for a PC was basically created by Apple, Office stolen from word perfect, browser stolen from Netscape, hardware hash security pirate protection stolen from an Australian inventor. Gee that's about everything they do, if only they would stop the sale of the windows like they did with Samsung tablets/ mobile phones for copy right breach. MS the most in original company ever made or was it copied?

RE: If I was MS
By raddude9 on 10/25/2012 5:18:37 AM , Rating: 1
Sure, microsoft should tell the EU to sit and spin, but I wouldn't like to be in the room when microsoft tell Acer, Lenovo, Dell and HP that they can't sell their windows machines in the EU any more. Maybe those companies would then tell microsoft to 'sit and spin'.

And 'using IE to download whatever browser you want' assumes that users have the competence to do just that and that they are aware of the superior alternatives. Just because nerds know this doesn't mean that the average person on the street does too.

"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings

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