Guilty as Charged

The DOJ has finally decided to show some teeth, suing Microsoft over their practice of forcing OEMs to bundle Internet Explorer with all copies of Windows 95.

To quote the complaint: "This action is necessary to stop Microsoft's ongoing violation and defiance of Section IV(E)(i) of the Final Judgment, which forbids Microsoft from requiring personal computer ("PC") original equipment manufacturers ("OEMs") to license other Microsoft products in order to obtain a license to Microsoft's monopoly PC operating system products."

My thoughts? Sure, they're guilty of leveraging their monopoly position in an attempt to preserve it, but I don't think that's really relevant to the lawsuit. In order for this event to violate the agreement as described above, Internet Explorer would have to be a separate "licensed" product. I'm not even sure it meets that qualification, or that hizzoner will see it that way. Let's explore some examples and definitions.

What is a "Licensed Product?"

My definition of "licensed product" means that the component or technology is available as an independent entity, either for free or for charge, or supported as such. We all know that Word is a "licensed product" (it certainly comes with a license!), because it is bought or bundled with our computer as a separate component, with separate sales and support channels. There would be no argument that Microsoft was in violation if they were to do this with Word. However, if Microsoft were to stop selling and supporting Word separately from Windows, then it may not meet this particular definition.

But what about IE? Is it sold separately? Let's look at the web site. Holy! Right there in the first paragraph is information on how to buy Microsoft Internet Explorer Plus at yer fave software shoppe. And over at the top of the right hand column is a link for how to buy IE on CD ROM. Okay, okay, I can hear the arguments already: Microsoft is simply recouping their distribution costs, and these mechanisms do not indicate that IE is necessarily a separate licensed product. After all, they charge for their Service Paks when bought on CD-ROM, too.

Alright, let's look a little deeper. Do I have to agree to a license to use IE? To me, that seems like a pretty clear indication of whether or not a product is separately "licensed," having an actual license and all. Let's see what comes with the product, er, "enhancement." WOW! Right away I get hit with "Microsoft Internet Explorer, END-USER LICENSE AGREEMENT FOR MICROSOFT SOFTWARE." Now that's GOT to mean that this is a separate product! What's that? Oh yeah, the Service Paks and bug fixes also come with EULAs, and they're not separately licensed.

Jeez, what a tough crowd. Let's look at the support options. Do I have to pay for support separately from the Win95 OS? Back to the web site, looking under the "Customer Support" icon in the lower left hand corner. BAM! There it is clear as day: "Pay Per Incident" support and "Priority Annual" support. This ain't good! Some of you might say that applying a Service Pak isn't covered under support either, but I know for sure that I don't have to pay extra to get support for WordPad. If IE truly isn't a separate product, I shouldn't have to pay for support for an "integral component".

Heck Yeah It's "Licensed"!

All of these fun points aside, for all practical purposes it would appear that IE is absolutely fundamentally a separate licensed product, by all measure. And for those of you who think that IE 3 is no more of a licensed product than the Service Paks, I got news for ya: The Service Paks are also licensed products.

I mean, if Microsoft had our best interests at heart, they'd bundle the Service Paks into the OS instead of forcing their market-lagging browser down our throats. Heck, for that matter, they'd give us Microsoft Office while they were at it.

Come to think of it, I don't buy this whole "customer benefit" story for a minute, and I hope nobody here is dumb enough to do so either. This is the biggest load of malarkey I've heard from Microsoft since OS/2's rosy predictions. Redmond may want us to believe it, but I'm not going to fall for the suckers trap of disingenuous argument.

Really, why don't they give us Office for free? Because they don't have to! They already own that market. It seems that the only time Microsoft wants to do us a favor is when we can repay it many times. Remember MSN? They wanted to do us a "favor" with that one, too. Boy, talk about violating the "separately licensed" product rule. Here's software that not only meets all the requirements listed above, but you also get to pay for it indefinitely. If that ain't a violation then nothing is!

Let's talk about IE on non-Windows platforms for a minute. Is IE for the Mac a "separately licensed" product? Heck yeah! Is the vaporware version of IE for UNIX going to be separately licensed? Probably not, because it'll probably never show up, but if it did, it would, I'm sure of that.

There is no way on Earth that IE 3 can be interpreted as integrated. For that, Microsoft is guilty-as-charged, and they should absolutely be punished for violating the consent decree. With IE 4 and Windows 98, the story may change, especially if the product is no longer available, licensed, or supported separately. Only time will tell how that unfolds. However, Microsoft will need to be careful about offering IE 4 on other platforms (particular Win95 and Windows 3.x) as a separately licensed product.

Charge of the Reno Brigade

Ya know, I think that Ms. Reno has probably come to this game a little bit too late, anyhow. Microsoft has already gotten away with the cookie jar on several fronts, including the forced bundling of MSN, among other things. Why act now? Actually, the charges against Microsoft seem to be much broader than they appear. Further into the complaint we find the following tell-tale statement: "Internet browser technology, as developed by companies competing with Microsoft, may be an important element in the reintroduction of competition to the PC operating system market."

And so we are to believe that the act of bundling IE with Win95 is bad for consumers' choice of desktop OSes? Give me a break! How does bundling a browser affect a consumer's choice of OS when Microsoft owns the only OS game in town?

Is there some sort of political dealing at work here? Could it be that the Justice Dept. doesn't really worry about the bundling deal at all, other than how it affects companies like Netscape?

The DOJ has shown before that it truly does care about the consumer (remember the failed Quicken acquisition?). And so while it is certainly possible that the DOJ is really concerned about holding Microsoft to the letter of the consent decree, I'm not buying their message entirely. I sure don't buy Microsoft's, but I don't think the DOJ is being all that honest, either.

But, that's just my opinion.

Eric A. Hall
President, EHS Company

Written by Eric A. Hall.
Copyright © 1998, EHS Company. net.Opinion is a trademark of EHS Company. All rights reserved.