Microsoft Competitors Win, But European Consumers May Lose

The guiding principle of antitrust law in the U.S. is the protection of consumers from anticompetitive practices. Europeans law, however, focuses on protecting competitors. The difference is on display in Microsoft’s decision to leave the Internet Explorer browser out of copies on Windows 7 sold in European Union countries. The move may delight competitors including Mozilla, Google, Opera, and Apple, but it will cause problems for some consumers.

Microsoft’s decision, announced June 11, is an attempt to placate—or perhaps show up—EU regulators who have been pressing the company for years to unbundle applications from its operating systems. To settle an earlier complaint, European customers have the option, one that has proven to be unpopular, of buying Windows XP and Vista without Windows Media Player.

The problem is that a Web browser has become an integral part of any computer, far more so than when this issue was first raised in the late 1990s. Buyers of new Windows 7 computers will probably see the issue resolved by computer manufacturers, who are free to load Internet Explorer or any other browser on their systems. Some manufacturers today, both in the U.S. and elsewhere, ship Windows PCs with both IE and Mozilla's Firefox installed, although IE is almost always set up as the default browser.

The people who are going to face a challenge are folks who upgrade their own computers to Windows 7. People moving from XP systems are going to have a problem. You cannot upgrade directly from XP to 7; you must perform what's known as a clean install, which requires reinstallation of all applications. When you finish conversion of an XP system, you'll have a brand-new Win 7 machine with no browser.

Without a browser, you will have no simple way to download one. One solution is to take the precaution of downloading the installation files and saving them to a memory key or other external media before you start the conversion. Microsoft will also offer a free Windows 7 Internet Pack on CD that will include the IE installation files. Microsoft will also make the code available for download over file transfer protocol, though that's a procedure that requires a bit of expertise to use.

It's less clear what will happen to customers upgrading from Vista. Normally a Windows 7 upgrade installs a clean copy of IE 8. Microsoft might modify the installation procedure to preserve an existing copy of IE or give the user the option to download a new one during the setup progress. No matter what solution is chosen, however, it is going to be a nuisance. And I suspect the final result is that nearly all installations of Windows 7 will end up having Internet Explorer; it will just be somewhat harder to do.

It is, of course, possible that Microsoft;s move is a bluff intended to make EU antitrusters see the error of their ways. Windows 7 is not scheduled to release to manufacturing before the end of July, so there is plenty of time for negotiations that would lead to a better outcome for consumers.

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