The European Commission is considering a new antitrust case against Microsoft, suspecting the software giant is trying to leverage its dominance of PC operating systems into the market for mobile phone software, say sources familiar with the regulator.
Commission spokesperson Amelia Torres denied that companies in the mobile phone market have complained to the Brussels-based competition authority. ‘I am not aware of any complaints,’ she said.
But she declined to comment on whether the European Commission might open a new investigation on its own initiative.
The EU competition regulator is concerned that Microsoft might take over the market for mobile phone software, according to a senior advisor to the European Commission. ‘Mobile phones are a very important market in Europe. The Commission is worried that Microsoft might take advantage of the strength of Windows in order to dominate in mobile phones,’ he said.
By leveraging its might into mobile telephony, Microsoft might reduce the role of mobile phones to mere conduits for its software, just as computer makers complain it has done with PCs.
‘Microsoft wants to commoditise mobile phones as it has done with computers,’ said a lawyer.
Microsoft threatens mobile phone operators as well as manufacturers, said a lawyer representing one of the main mobile phone makers in Europe, who requested anonymity. ‘If Microsoft’s .Net initiative is to be a success, it needs mobile phones to play by Microsoft’s standards. Mobile phone operators could have a problem with that.’
The .Net initiative attempts to link Internet users to Microsoft’s system, giving them a passport for access to Microsoft and partner sites that conform to .Net standards.
When mobile phones become Internet-compatible, the phone operators want to become the Internet gatekeepers for their customers. The .Net initiative would undermine their role in the relationship with those customers, the lawyer said.
Finnish mobile phone maker Nokia, the manufacturer with the most to lose from a Microsoft assault on its market, has not yet complained to the European Commission, according to one of its lawyers in Brussels.
Reports suggest European companies have already complained to the Commission about Microsoft’s move into the mobile phone software market. The companies contend that Microsoft is bundling its corporate e-mail software, called Titanium, with code that ensures servers have better connections to Windows-based wireless devices than to competitors’ devices, according to the article.
Microsoft does aim to transform mobile phones into mini-PCs. In October 2002, France’s Orange SA launched the Windows-based Orange SPV in the UK. However, last week the company was rejected by UK phone maker Sendo, which decided to power its phones using Nokia software. Microsoft has a stake in Sendo, but only a minority stake.
Any new probe into Microsoft is unlikely to begin until the existing case is closed. People close to the Commission said it is highly unlikely the new concerns about mobile phones would be added to the existing case, as this would delay that ruling. The existing case against Microsoft comprises two separate investigations. The first stems from a complaint about Microsoft’s abuse of its Windows monopoly by rival Sun Microsystems. The second part, focused specifically on Windows 2000, was initiated by the Commission.
18/02/2003
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