Opera seeks tougher remedy in Microsoft case
November 6, 2008 nnyq.com editMicrosoft was considered to have escaped lightly after the European Commission found it guilty in 2004 of bundling its media player software with Windows to the detriment of competition. It was ordered to sell a second version of Windows in Europe without its media player, but the new version was priced the same, few PC makers stocked it, and the product effectively bombed in the market.
People continued to buy the original version of Windows, complete with the media player, and the remedy did little to help Microsoft's rivals.
With its fresh antitrust suit filed with the Commission this week, browser maker Opera Software is hoping for a tougher penalty to rein in what it sees as Microsoft's illegal bundling of its Internet Explorer (IE) browser with Windows. One legal expert said that this time around, Microsoft might not be so lucky.
"The landscape has changed quite a bit between Microsoft and the European Commission since the last ruling. If there's a replay of what led up to the 2004 ruling, and Microsoft takes similar positions regarding bundling, then I wouldn't be surprised if the Commission comes down harder now," said Chris Norall, a partner in the Brussels office of the law firm Morrison & Foerster.
Opera argues that because each version of Windows comes with only IE preinstalled, Microsoft has an unfair advantage against rivals like Opera and Firefox. That has helped it maintain a consistent market share on Windows PCs of around 80 percent, Opera contends.
The Norwegian company now wants the Commission to come up with a tougher remedy to overcome Microsoft's advantage. If the Commission agrees that the bundling of IE is just as illegal as the bundling of Windows Media Player was in 2004, its remedy this time "will be tougher, it will have teeth," said Norall, whose law firm is not involved in the Microsoft case.
One possible outcome would be to make Microsoft offer a second version of Windows without Windows Media Player, and to sell it at a lower price than the "complete" version of Windows. That may give PC makers more incentive to offer it. Opera's preferred solution, however, is simply to force Microsoft to preload other browsers with Windows when it ships.
"In our minds, the best solution would be one version of Windows with a must-carry type of provision," said Jason Hoida, Opera's deputy general counsel.
Microsoft is likely to fight that remedy fiercely. It says it will cooperate with the Commission's investigation, but argues, as it has before, that consumers benefit from bundling its browser with Windows. What's more, it notes, PC makers and consumers are free to install any other browser if they wish.
Microsoft's position may be strengthened by the popularity of rival browsers in Europe, notably Firefox, which has reached a market share of close to 40 percent in some key markets, such as Germany, studies have shown. If Microsoft can argue that rivals to IE are gaining market share, it could help it persuade the Commission that antitrust intervention is not necessary.
