US ruling frees Microsoft

Microsoft is free to exploit its dominant market position as it moves beyond PCs to other platforms such as smartphones, following last week's antitrust ruling in the US, say analysts.

Although Microsoft will have to share some code with rivals to allow them to create competing applications, no major new obligations were imposed on the firm at the end of the five-year antitrust case. Analysts said this means IT buyers may find their room for negotiation eroded, and they should consider alternative products to seek better deals where appropriate.

Philip Carnelley of analyst firm Ovum said Microsoft is privately pleased with the outcome of the US case, which failed to investigate the vendor's growing influence over platforms other than the desktop PC, despite requests from the plaintiffs.

"Microsoft has an in-built advantage over competitors in other platforms because it offers compatibility with software on the desktop," Carnelley said. "It looks set to dominate in mid-market business and mobile phone software, challenging Symbian and Palm. The new Orange phone running Smartphone could be just the start, especially if Microsoft makes friends with the Asian phone manufacturers."

Some aspects of the ruling toughened measures to reduce Microsoft's hold on the desktop. Under the modified settlement provisions, the company cannot threaten to retaliate against PC makers, software companies or other partners if they support non-Microsoft software - which may lead to more computers shipping without pre-installed operating systems.

Secretly delighted

Tony Lock of analyst firm Bloor Research suggested that the ruling imposed the minimum sanctions. "I'm sure Microsoft is secretly delighted it has got away with so few obligations," he said, adding that the firm has been asked to police itself.

Lock argued that users were better able to reduce Microsoft's strangle-hold by considering other suppliers, rather than by relying on the courts: "There are pressures on Microsoft like Linux and Apple moving forward, and the impact of thin clients."

Microsoft has also been banned from using hidden APIs to allow its applications to run better than those of its competitors on Microsoft platforms. So now its rivals could theoretically write applications exploiting the Windows platform just as effectively as Microsoft's own developers.

Microsoft's legal battles are not over. A looming EC antitrust case could examine its influence over platforms other than the desktop, and tougher penalties may result.

Have your say: contact IT Week