Microsoft accuses EC of putting Vista launch at risk

Microsoft wants European regulators to clarify what it can and cannot bundle as part of Windows Vista

Microsoft escalated its row with the European Commission (EC) this week reiterating warnings made in an open letter from MEPs to the European Competition commissioner that regulatory actions could delay the European launch of Windows Vista and raising fears that EC requests could compromise the operating system's security.

Speaking to IT Week, a Microsoft spokesman said uncertainty over the “application of EU competition laws to an operating system” meant there was a risk the planned worldwide launch of Vista in November could bypass Europe.

The EC has informed Microsoft of concerns about the legality of some of the planned security, search and document format features bundled in Vista. Microsoft said it had requested clarification from the EC to find out “whether the Commission is seeking additional product design changes that would result in delay in Europe”.

The spokesman hinted that any requested changes would be likely to cause delays, claiming “there is not a lot of slack on that [release] timetable”.

Meanwhile, Erich Andersen, associate general counsel for Microsoft, warned that the Commission's concerns about Vista's security features could leave European customers vulnerable. “One of our principal concerns is that European consumers have access to the same new security features in Windows Vista as everyone else,” he said. “We hope the Commission will not require removal of these important features.”

However, EC spokesman Jonathan Todd dismissed suggestions the EC could delay Vista, claiming in a statement that it has co-operated with Microsoft; that “there is no uncertainty whatsoever concerning EU competition rules”; and that “it is not up to the Commission to give Microsoft a definitive ‘green light’ before Vista is put on the market”.

Gary Barnett of analyst Ovum said there was a case for strong regulation of Microsoft, but argued that the EC had a history of saying its requirements were completely clear when they remained ambiguous. “There are concerns about the EC's ability to effectively regulate Microsoft,” he said. “It would be very unfair if as a result of the EC's lack of clarity Microsoft was forced to delay a product release.”

Neil Macehiter of analyst firm Macehiter Ward Dutton agreed Microsoft might have some justification for thinking the EC could cause delays to Vista. But he added that Microsoft’s recent comments were more likely to be a “pre-emptive strike” designed to head off antitrust action once Vista is launched.

“The problem is that there is no definition on what represents a legal operating system and what can and cannot be bundled,” said Macehiter. “What Microsoft is doing is trying to paint the Commission as the bad guy and set out its defence for any future antitrust case early by claiming the Commission has not told them what it can and can’t do.”

Meanwhile, a spotlight was thrown on the extent of Microsoft's lobbying activities after it emerged the MEP behind the open letter that sparked the current row recently met with Steve Ballmer.

The letter from a group of one Polish and three UK MEPs cited Microsoft’s concerns about the EC's activities; argued any delays to Vista caused by the Commission would damage European firms' competitiveness; and requested a meeting with competition commissioner Neelie Kroes to seek reassurances that she understands the repercussions of the “ongoing pursuit” of Microsoft.

However, the letter failed to mention that one of the signatories, Conservative MEP Chris Heaton-Harris, visited Seattle last month and met with Microsoft chief executive Steve Ballmer. Nor did it mention that Microsoft is a major employer in his East Midlands constituency.

Responding in an email to suggestions this should have been disclosed in the letter, a spokesman for Heaton-Harris argued that as the information was publicly available on the MEP's web site there was no need to disclose it again. He also confirmed that the US trip was funded not by Microsoft, but by right wing lobby group the American Legislative Exchange Council (Alec). However, when asked, a Microsoft spokesman admitted it had sponsored Alec in the past.

Microsoft rejected any suggestion of impropriety in its lobbying activities, insisting it was normal practice to update MEPs on the EC case and that the letter had been conceived by the MEP's and was prompted not by the company but by concerns amongst their constituents, including IT retailer Dixons and the Thames Valley Chamber of Commerce, that Vista could be adversely affected by the EC's actions.