Holy cow, the EC has now fined Microsoft a cumulative figure of £1.27bn (~$2.6bn) for what they say is the worst case of non-compliance with antitrust / competition law in 50 years. Even when set against the quadzillion dollars Microsoft makes every waking second that’s a pretty robust kick in the knackers if I ever saw one. The latest round covers the period where MS finally opened up some specs about desktop interoperability, but charged competitors disproportionate royalties to use them - supposedly because APIs now represent ’significant innovation’ if you’re Microsoft, although in my opinion an API spec represents about as much innovation as my next shopping list. Weirdly I’m of the opinion that implementations are where the vast majority of development work goes, but what do I know?
With any luck, this latest fine will give MS pause if they try to use royalties as an alternative way to stifle competition following their latest ‘we’re open, honest’ touchy-feely announcement.
February 27th, 2008 at 1:35 pm
Am I not right in thinking that MS made a bold move to make something (API perhaps) more publicly available? Was this a move because of their infringements on EU law?
They’re getting fined left, right and center at the moment. I guess they’ve only got themselves to blame though.
February 27th, 2008 at 2:05 pm
Er, follow the link in the last sentence mate
February 27th, 2008 at 2:08 pm
That just another form of taxing …. I guess EU is running out of entities to tax locally.
But hey, it won’t cost MS a dime - as always the fine will be paid collectively by all MS customers , which, given that significant portion of them is from outside of EU, it is still a pretty good deal to EU.
If you can’t compete technologically, you do what you can.
February 27th, 2008 at 2:50 pm
That is a good point about the competition and calling it a “tax”, but there are sometimes where competition breaks down. Its just basic economics, when one player gets a near monopoly position (or a full one) the consumers suffer.
Now I don’t think a fine is the way to go, because you are right. All of are just going to end up paying that money in cost of higher products. The proper way would be to end the monopoly, not the milk people for cash through it.
February 27th, 2008 at 3:33 pm
The moral is of course that if there was genuine competition then they wouldn’t be able to pass the fine directly on to customers, because they could shop elsewhere. The argument for not using a fine is in itself an indication of how the market is unbalanced.
You’re right though that a fine is not the answer in itself, but what else can they do? They tried to split the company but that failed. Without some other kind of sanctions which would affect customers, this is the only way the EC can make the point about monopolies. It’s a horribly blunt instrument, but cajoling hasn’t worked in years gone by so they have to use what they have. If it’s at all responsible for MS’s statement last week, then that’s a potentially positive step - depending of course on how it pans out.
And to be honest, claiming that MS compete on technology is a bit of a laugh. They compete mostly on bundling, chain-buying (linking products together through closed APIs) and close knitting of their own products. Individually very few of their products are best of breed (Office is the only one I can genuinely think of as best in its own right now, although Visual Studio was for a while), but via bundling and tight (closed) integration, they can also sell a lot of mediocre me-too software.
February 27th, 2008 at 4:21 pm
Wow, I’m feeling a lot of hate towards MS, esp in the comments! I don’t know, I feel like I’m taking the opposite side just to try and balance things out a bit. All this is my personal opinon, as always.
* Where does all that fine money *go*. (Same goes for the water companies that get fined money… then in the next announcement water prices go up…)
* Is it still proftiable for MS to sell software in the EU? Lets say if MS just said “screw ‘em” and pulled out of the EU, would that make the world a better place? I’m sure you would be at the forefront of the “told you so” wagon if they did pull out though
* Personally, I consider some APIs to be great. In Beautiful Code for instance, http://svn.collab.net/viewvc/svn/trunk/subversion/include/svn_delta.h?revision=21731 is quoted as being an awesome and flexible api and I have to agree
* APIs, once published, have to be supported. Considering how much pain you have with OpenGl versus DX… and supporting different versions of Ogres interfaces for example. Coming up with a good set of public interfaces is key to making a great library, and sets the bar for the implementation. While “innovative” I think is the wrong word to use, there is undeniably some skill and effort in creating those things
Perhaps MS should have unbundled Mediaplayer - perhaps charged for a version of Mediaplayer that can show things full screen (Mediaplayer Pro?). Perhaps have a whole uLive suite. ;0)
Bit of a sweeping statement calling “a lot” of MS software “me-too” and “mediocre”, I guess I remember Vista being bitched about here but can’t remember anything else off the top of my head. Maybe the flood is about to begin!
Actually I wonder if it’s good etiquite to put a counter point in a comment actually, or just stay quiet. *ponders*
February 27th, 2008 at 4:52 pm
Frankly, I don’t see that much wrong with MS to begin with.
It could very well be that a monopoly of that sort is quite natural in this market.
After all, it would not have been possible for MS to acquire this sort of monopoly all over the world - I mean we are talking here completely different and dissimilar markets – if it weren’t for the joyful clapping of majority of software houses and a genuine market for their products.
Back in late 80s and early 90s people were truly sick and tired of plethora of failed or failing operating systems ( anyone remember Amiga OS, Atari ST, Apple etc ) and having an established and centrally controlled dominant platform was like a dream come true.
Another explanation is that , back then , the world beyond US was pretty much a technological wasteland (as far as computers and OS development is concerned) whatever was happening in US , it was being accepted by default and thus this incredible world-wide monopoly of MS.
February 27th, 2008 at 5:01 pm
@Paul: all opinions welcome
I consider products like SQL Server, NT/Windows Server, Exchange, Team Server / SourceSafe, Active Directory, Sharepoint and probably more I can’t think of right now to be me-too products. None of them do anything radically different or better than anything else out there, many are based on ‘enhanced’ standard protocols, and mostly do well because they’re nicely integrated with the OS that is bundled on almost every desktop rather than their own merits vs the competition. Personally I think Office sold Windows, and Windows sold everything else - a bit of an oversimplification but it’s largely true. MS do make nice interfaces to things, and do integration among their products well, but a lot of that is because they have historically kept interfaces tight to their chest - everyone else has to reverse engineer (see Samba). Having one company dominate just because they happened to be smart about one or two particular products (bundling MS-DOS and then Windows, and then buying & developing Office) is very bad for competition and hence the customer environment.
@warmi: The world beyond the US was a technological wasteland?? I’m trying to figure out just how insulting that is….
The US just learned how to make it big business, that’s all, that’s far from being the same thing as innovation.
February 27th, 2008 at 5:07 pm
“The moral is of course that if there was genuine competition then they wouldn’t be able to pass the fine directly on to customers, because they could shop elsewhere. ”
Well, any company that is fine/taxed will have to somehow make up for it … for the only entity that can literally produce money out of nothing is the government ( and that’s is why I find this fascination with corporate power puzzling – all these corporations are small time players compared with entities like US or EU and really, historically they are not the ones we should be afraid ).
As far as fines – there could be only two choices, either lower the profit margin or pass it on to customers.
99% of corporations will pass the costs if they can … and incidentally that is why the first thing people learn on Economy 101 is that corporations don’t pay taxes – they simply collect them on behave of the government.
Taxations and fines are ALWAYS evil – sometimes necessary one but still …
“And to be honest, claiming that MS compete on technology is a bit of a laugh.”
Well, I presume you refer to my comment about inability to compete… well, I should have been more clear .. I was refering not to EU but to the sponsors behind this EU/US vs MS nonsens, that is IBM , SUN and other technological giants …. they know who they are
February 27th, 2008 at 5:12 pm
“The world beyond the US was a technological wasteland?? I’m trying to figure out just how insulting that is…. ”
Well, it was true … back in the late 80s, early 90s , beyond dying 8 bit market ( Spectrum and Amstrad … and MSX – yeah, I had one from Phillips ) I don’t seem to recall a single thing happening in Europe and Asia … and I know, cause I used to live there up until 1994 …
I mean there was Unix, Mac OS, Amiga OS, Atari OS, DOS… hmm, early versions of Windows .. then , as I remember, we had Next …
If you look at it objectively, whatever was happening on this front it was being done in US - sad but true.
February 27th, 2008 at 5:25 pm
Paul’s point about where the money goes is also a good one. The EU does run some initiatives to sponsor European startup sci/tech projects, so one would hope it would go into programmes like that.
@warmi: I still think you’re mixing mass-market vs innovation. ARM/Acorn (British) were doing some superb work in that time, far ahead of Microsoft and easily challenging Apple in OS usability terms. But, they didn’t catch the mainstream bundling market the way MS did (its all IBM’s fault) so never went huge. They do however do a lot of good work still, just in embedded markets away from where MS dominates. In the 80’s, many of our serious business applications ran on Mainframes from a British company called ICL, before MS even had an OS, whose OS did virtualisation in almost exactly the same way the next version of Windows Server will. MS have always had major business chops, which has got their products in the right place at the right time, but their products have rarely been the technical leader. Again, I willingly give kudos to Office and Visual Studio here, but few others.
February 27th, 2008 at 5:25 pm
I tend to see that in this perspective: Bill Gates certainly has chosen a perfect time to ‘exit’ from Microsoft and transfer the ‘mess’ to Mr. Ballmer. You will hate it when you are the founder who drove the company to the top of the world but the still in when it is diving down into pile of …
February 27th, 2008 at 5:47 pm
“ARM/Acorn (British) ”
Oh, I completely agree … I spent quite a bit of time coding for various ARM incarnations int the embedded industry.
.
I have to admit that UK was actually closer to US than to the rest of EU …. still given the size of EU (as compared to US) , it was rather pitfull contribution….
Of course there were plenty of excellent coders ( anyone remember insanely crazy and talented demo scene community ? ) but a lot of the best ones eventually ended up working for US companies
And I am not just talking about MS … but rather the fact that whatever wars were being waged , they were being waged between US companies … and the rest of the world was there just for the ride.
February 27th, 2008 at 6:17 pm
@warmi - I’m from the UK, married to an American but still living in England… and I must say sometimes you *do* notice the anti-american thing going on when someone you love is getting constantly pestered about being American.
Some people have strange ideas about America and Americans
Most seem to think just because they visited Cali or Florida or New York that they *know* America. Sometimes people she only just met start going off on one about Americas foreign policies etc, and can make sweeping, very innacurate statements.
As for if this is an anti-american thing wrapped up with the other politics going on… who knows? Perhaps if the next president gets on with european media and leaders better it will all be different. I would hope the people deciding that case aren’t that petty, and the people weren’t influenced by external issues and concentrated on the things presented from both sides in that case.
February 27th, 2008 at 6:21 pm
Yep, being the biggest economy in the world tends to bias things that way - I actually think that some of the best ideas come out of environments that are not quite so obsessed with capitalism, the small outfits who are thinking outside the box. That’s why I’m so strongly against monopolistic behaviour because I think it’s detrimental to just about everyone - probably including Microsoft, funnily enough, in the long term. If you make it almost impossible for others to compete with you, where are the genuinely new ideas going to come from, where’s the drive to exceed expectations? I guess that’s when you end up with products like Vista. The industry as a whole needs genuine competition.
February 27th, 2008 at 8:40 pm
@Paul: I always find it really hard to square the difference between ‘America’ as a country and ‘Americans’ as individuals. Pretty much every American I’ve met in person has been really genuinely nice - actually on average nicer than most British people you might meet on the street. I have several very good friends over there. That’s in contrast with the US government’s actions which are often utterly baffling to any sane person, and the US media which on the whole makes me dispair when I’m in the country. It’s most odd, and I guess that’s at the root of all the generalisations.
February 27th, 2008 at 9:51 pm
Hehe .. I actually find European media quite homogeneous.
As if a lot of questions which are still open for discussion here in US were already decided and settled over there. What generally passes as a valid political view in US is treated as something out of mainstream or perhaps either silly or outright dangerous in Europe.
in US, one can easily find mainstream views advocating publicly funded health-care as well as the opposite - same goes for multitude of subjects from guns to taxes and personal freedom.
In Europe things like that generally evoke nothing but accusations of backwardness or even fascism.
I guess what I am trying to say is that the spectrum of acceptable political behavior is much more limited over there than it is in US.
February 27th, 2008 at 10:17 pm
@Paul
Yeah, I used to be one of them
But in reality , after spending over 10 years in US , I came to conclusion that, while Americans are definitely less , should we say globally curious, than a typical European, they don?t suffer from what I consider to be an inferiority complex , something quite often found among Europeans.
I don?t know which one is better, having a ridiculously uninformed opinion ( mainly courtesy of Hollywood and European media ) about USA which is common in Europe, or simply not caring at all , something found in abundance on this side of the pond.
February 27th, 2008 at 10:26 pm
Really? That’s actually the opposite of my experience, although I’m talking about compared to the UK now. Personally I found political opinion in the US to ultra-conservative in the main, with a lot of religeous (ie Christian) bias. I find debate in UK politics to generally be more honest and from a wider spectrum - but maybe that’s just a reflection of the news channels I saw in the US while I was there.
February 27th, 2008 at 11:06 pm
Europe is obviously stil worthwhile the “hassle” MS has with it. Not delivering to Europe would certainly cause a breach in the dyke. They’d loose market share everywhere else too, because of solutions developed here. If it is not now cost efficient for many customers to look out for competitors, which most likely where linux based, it will be then. MS can’t have this happening so they will pay.
As for the fine itself, it is not too uncommon that companies get fined because of competition law breaches. That happens to big European companies too. And the fine is bound to business volume, since MS has big business, they have to pay big fines. Don’t see a problem with that.
More so since these fines are lawful. MS knows what it is supposed to do, it has not only comission orders, but also a finding by European Court of Appeal. They didn’t comply, they pay. Easy as that.
Even if a monopoly got to life “naturally”, it still is a market failure and has to be fixed. Because once it is established, it is easy to push around competitors, to the detriment of everyone else.
I’m not convinced about this. Over all Europe you probably are wrong. Between UK and Belarus, you will find more variety than in the US. The spectrum is different. As the saying goes, “From German perspective USA have a one-party-system with two right wings.”
I’ve never felt a inferiority complex or anyone seen it. Actually many people here, seem to feel themself morally superior, whic is not my position here. But neverhteless, no inferiority complex to be seen.
February 27th, 2008 at 11:54 pm
“Between UK and Belarus”
Oh come on. I mean EU itself … not what amounts to a holdover from a bygone era.
““From German perspective USA have a one-party-system with two right wings.”
Not really, there are many politicians in US advocating EU style socialism (Hillary and Obama )… find me a serious politician in EU advocating lifting ban on guns, reinstituting death penalty , getting rid of socialized medicine or the minimum wage.
I bet even having these political positions listed in the sentence above was enough to evoke disapproval and perhaps even outrage ..
“But neverhteless, no inferiority complex to be seen.”
Oh there is …. Europeans simply love to endulge in criticizing US and I don’t just mean foreign policy … but in general what they call “social and religious backwardness” etc…
I know …. I talk to my family regularly.
February 28th, 2008 at 1:05 am
> Frankly, I don’t see that much wrong with MS to begin with.
> It could very well be that a monopoly of that sort is quite
> natural in this market.
Monopolies stifle innovation and keep prices high. That’s one reason why people are paying a fortune for the failed Windows Vista operating system.
Monopolies are always bad. In the western capitalist ecosystem, there is nothing remotely natural about a monopoly.
Today was a victory for free market capitalism and the rule of law.
February 28th, 2008 at 4:31 pm
“Today was a victory for free market capitalism and the rule of law.”
I am not so sure about that.
It would be if Apple suddenly started experiencing increase in its market share in the wake of Vista fiasco ….
Issuing a fine won’t do much but make future versions of Vista that much more expensive.
Of course, it could very well happen that BECAUSE of this potential price increase , Apple or perhaps someone else will start taking away market share from MS - will see.
February 28th, 2008 at 8:26 pm
EU will never see a dime of that money..and for good reason. Its absurd to think that people still claim MS is a monopoly.
February 29th, 2008 at 8:55 pm
I don’t think looking at MS being fined by the EU as an America vs. Europe issue is really a good angle.
MS may have been founded in the US and have their main base there but they are a global company trading in many different regions with many different laws. It is up to MS to know the laws of the region they are trading in and obey them and to comply with any court rulings in that region. If they fail they should be penalised.
If the fine is passed on to all MS customers globally that’s not Europe’s fault, it is Microsoft’s for failing to comply with local laws. They failed to do as the law required them to do and they have to be penalised in some way. If they had we wouldn’t be talking about the cost to customers.
If business want to trade in different regions around the world they need to comply with local laws. Contrary to popular belief no one set of laws is “right”. We may view certain laws in certain countries as “wrong” but that doesn’t mean we are any more right or that we can pick and choose what laws we comply with when we are in a country.
To summarise, fining MS has nothing to do with the brave US company fighting against the evil forces of Europe and has everything to do with a global company being made to comply with the laws of the sovereign nations it wants to do business in.
February 29th, 2008 at 9:53 pm
Now that we’re discussing politics, could someone (preferably from the USA) explain these two things, I have been wondering about them for some time and have not had the chance to ask an American about it.
1. Why is that only 2 parties seem to be able to get enough votes to be able to make a difference (democratic party/republican party)? Actually anyone from UK should be able to answer this as well (Labour/Conservative/Liberal Democrats). Here in The Netherlands we have about 7 that ‘matter’, and 3 of them in the coalition. And we’ve only 16 million people living here, with a lot less ethnic or even social diversity.
2. The media, and especially the so called political analyzers/reporters, seem to speculate about which candidate will get the most votes purely looking at things as skin color/gender/lifestyle/age or even who is supported by the most celebrities. Is this just a biased view of the real situation I’m seeing here, through television and internet, or is this really how it works? (the campaigns with all their outward show don’t help in making me believe otherwise)
Not meant to be offensive in any way, I’m just curious and hoping to get an unbiased response.
February 29th, 2008 at 11:42 pm
@Amotea , eventhough I am German, I believe I can answer this. The voting system is quite different. In UK and USA the winner takes it all in each electoral district. The one candidate with the most votes wins a chair in parliament. Unlike in Netherlands, where chairs are given in relation to votes received. Would the same system apply in Netherlands as it is in UK, then the seating in your parliament were vastly different. Probably CDA and PvdA would divide almost all seats between them, because they get most votes in, the odd SP or VVD candidate might have a chance too, all other parties were basically out.
It is moot to discuss which system, majority or proportional representation is better, both have different traits and are deeply embedded in the countrie’s consciousness and tradition.
In Germany we have a mixed member proportional system. Half the seats are given proportionally to candidates on a list, half are given to a direct majority candidate, but overall proportions are preserved. If a party has more directly won seats than they’d win by vote proportions, less candidates from the list are seated. Complicated but, as I believe, quite just.
We also have a 5% threshold. A party needs at least five percent of the votes to get parliament seats from the list. Direct candidates always get their seat though.
March 1st, 2008 at 6:22 am
Obviously , US being pretty much the oldest and the most stable of all modern democracies (at least in terms of continuity)…. a two party system appears to be working pretty darn well.
“seem to speculate about which candidate will get the most votes purely looking at things as skin color/gender/lifestyle/age or even who is supported by the most celebrities”
Uh ? Perhaps this election is a bit different because for the first time there is a real chance a black man or a woman will be elected to the office of the President but normally , I don’t see much fascination with anything you mentioned – well, discounting the likes of Jay Leno of course.
March 1st, 2008 at 2:11 pm
Actually the UK parliament at least (not sure about others) predates that of the USA by about a hundred years, having been enacted in 1689. The US just bangs their drum a lot louder
There are differences of course, the US’s was there to unify a disparate set of states, the UKs was there to prevent tyrannical monarchs, and both systems evolved over time with neither really becoming entirely fair until the early to mid 20th century. But nevertheless, the core principle dates back to then without any break. And of course we owe it all to the Greeks anyway.
All ‘party’ systems are horribly flawed but they’re the only way to get anything done and for people to vote effectively for a given set of principles. I would agree with other Europeans here that the US looks like a system with 2 right wings, it’s just that one of them is a little bit more left of the other, but they’re still centre-right. Here in the UK the centre used to be much more right-wing than it is now, centre-left is much more common these days. Other European countries are even more left of us, which is why the US looks mostly right-wing (even Obama is more like our conservative party here). It’s all part of a wide spectrum, and where you determine the ‘centre’ to be depends on the culture you live in - personally I’m most at home in a centre-left kind of environment, which is why I find US politics a little grating. If Obama is as left as you go, you’re barely moving out of the centre ground in my perception - but that’s just the thing, it’s perception.
I also think religeon has absolutely no place in politics, which is why Bush’s spouting about his ‘Christian values’ makes me ill. Religeon is inherently irrational (no offense intended) and leads to entrenched emotional positions, and as such it is too dangerous to allow it to influence political thinking - that’s how so much war & terrorism started in the first place.
March 1st, 2008 at 4:55 pm
“I also think religion has absolutely no place in politics”
Yeah, it makes me cringe every time someone invokes a higher power of any kind.
It is actually kind of condescending but whatever … I don’t actually consider publicly flouted religiosity being a threat to me freedom.
The fact that someone like Bush claims to derive his ability to get up in the morning and do whatever is he/she doing, from a higher being is of no interest to me.
I mean God, hormones or Prozac … whatever makes you get up and go every morning is really not my business.
And frankly Bush is not a religious fanatic as he is being portrayed … his closest friend and advisor , Carl Rove is an admitted atheist - not exactly a mark of fundamentalist administration.
Overall I tend to vote Republic because for all their silly references to God, historically they were the people to most likely guarantee my freedom.
All these “God Bless America” might be annoying and silly but the real threat comes from the stuff like “we are in this together” I hear from people like Hillary Clinton or Obama .
This sort of mentality is much more dangerous to my freedom…
March 1st, 2008 at 5:26 pm
30 comments…
Steve, your blog is turning into Slashdot.
March 1st, 2008 at 6:11 pm
> Religeon is inherently irrational (no offense intended)
None taken. But to be accurate, PEOPLE are inherantly irrational. Be it through the outlet of Religion, ploitics, science, or otherwise. Ridding the world of Religion would only be ridding the world of an ideal, and not of our human nature for greed and violence. There will always be those seeking power and will make extreme influence, and take extreme measures to get it, whether it’s through religion or some other way. In the same way that it is said that life will find some way to survive, so will the human race find ways to conquer, control, and oppress one another.
March 1st, 2008 at 7:20 pm
@Frenetic: that’s what a politics / religeon debate will lead to
@Dan: you’re right of course - ‘religeon as interpreted by people’ is perhaps more accurate. I guess my problem is that religeon is often used as a socially acceptable form of bigotry - it’s not ok to oppress people if you’re a dictatorship , but it IS ok for example to oppress the gay community and say it’s ‘unnatural and against the bible’. And it’s ok to stop women becoming ordained priests in orthodox orders. I don’t see why one form of oppression is ok, and another isn’t, which is why I don’t like religeon in politics, it’s often a place for bigots to ‘hide in plain sight’ and somehow be upstanding citizens, because the arguments about their religeous beliefs are essentially unassailable. It’s a bit like the ‘think of the children’ argument - guaranteed to stop any debate stone-dead regardless of merit.