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Windows 7 Draws Complaints from Mozilla
,----[ Quote ]
| Microsoft Corp's next version of Windows is stirring fresh complaints of
| anticompetitive behavior from rivals who say the new version of the operating
| system gives unfair advantage to Microsoft's Internet Explorer browser, the
| Financial Times reported.
`----
http://itmanagement.earthweb.com/osrc/article.php/3819176/Windows-7-Draws-Complaints-from-Mozilla.htm
Windows release sparks row over browsers
http://www.ft.com/cms/s/4be5342a-3aa1-11de-8a2d-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F4be5342a-3aa1-11de-8a2d-00144feabdc0.html%3Fnclick_check%3D1&_i_referer=&nclick_check=1
http://tinyurl.com/cbstuh
Recent:
E.U.'s Bundle Of Joy For Microsoft
,----[ Quote ]
| Opera initiated the Commission's case when it first filed a complaint in late
| 2007. Since then it has become one of the case's "interested third parties"
| together with Google and Mozilla under the umbrella of Brussels-based ECIS,
| or the European Committee for Interoperable Systems.
|
| But won't bundling a few more browsers like Opera into Windows be just as
| unfair to other browsers who aren't included? "That is of course a question
| that has to be addressed," said ECIS's legal counsel Thomas Vinje, who thinks
| between four and five other browsers should be packaged in. "The choice of
| who is included is an important one." Opera is not guaranteed a place, Vinje
| insists. The Commission would take advice on that from independent experts.
`----
http://www.forbes.com/2009/04/28/microsoft-european-union-markets-equity-browsers-opera.html
Microsoft Pushing Out IE8 Through Auto Update
,----[ Quote ]
| Microsoft has begun pushing out Internet Explorer 8, the latest version of
| its Web browser, to Windows users who are signed up for automatic software
| updates.
`----
http://voices.washingtonpost.com/securityfix/2009/04/microsoft_pushing_out_ie8_thro.html?wprss=securityfix
IBM-led tech outfit backs EC in Microsoft browser fight
,----[ Quote ]
| “This is an important case to ensure that browsers can compete on the [sic]
| merits and that consumers have a true choice in the software they use to
| access the World Wide Web," said ECIS spokesman Thomas Vinje.
`----
http://www.theregister.co.uk/2009/04/15/ecis_third_party_status_ec_versus_microsoft_ie/
ECIS Press Statement
,----[ Quote ]
| Support Grows for EU Browser Case against Microsoft
|
| Brussels – 15 April 2009 – The European Commission recognised ECIS as an
| interested third party in support of the Commission’s preliminary findings
| (Statement of Objections) that Microsoft is violating EU anti-trust law by
| tying its Internet Explorer (IE) web browser to its dominant Windows
| operating system present on over 90% of all personal computers.
`----
http://www.ecis.eu/news/documents/ECISanIntervenorinEUMicrosoftbrowsercaseApril2009..pdf
Mozilla: Sometimes govt. is answer to Microsoft
,----[ Quote ]
| Despite this success, Baker believes that government, and in the European
| Commission in particular, has a role to play in further leveling the playing
| field. As she notes in a recent blog post, government entities would perhaps
| have less relevance but for the antitrust activity that resulted in
| Microsoft's dominant market share in the first place:
|
| Microsoft did not obtain its (Internet Explorer) hegemony solely through
| competition on the merits of IE. A number of illegal activities were also
| involved in creating IE's market dominance...The idea that Microsoft is
| an innocent victim (of European Commission intervention) is deeply
| flawed.
`----
http://news.cnet.com/8301-13505_3-10167433-16.html
E.U. mulling ordering Microsoft to carry rival web browsers
,----[ Quote ]
| In its regulatory filing in the U.S. submitted late January, Microsoft said
| that the commission is considering ordering Microsoft and computer makers
| to "obligate users to choose a particular browser when setting up a new PC."
| That might include a requirement that computer manufacturers "distribute
| multiple browsers on new Windows-based PCs," Microsoft said in the SEC
| filing.
`----
http://www.marketwatch.com/news/story/eu-mulling-ordering-microsoft-carry/story.aspx?guid={0400E025-7A4B-44CA-9F9C-D0E0D9F1F443}&dist=msr_1
EC to Microsoft: We may still fine you
,----[ Quote ]
| In a statement earlier today, European Commission spokesperson Jonathan Todd
| is quoted by two sources, the International Herald-Tribune and the AFP, as
| having publicly renewed the EC's warning to Microsoft that it could impose
| more fines and force the company to offer competing Web browsers as an
| alternative to Internet Explorer, for the company's European edition of
| Windows 7.
`----
http://www.betanews.com/article/EC-to-Microsoft-We-may-still-fine-you/1235513297
EU May Order Microsoft To Carry Rival Web Browsers
http://money.cnn.com/news/newsfeeds/articles/djf500/200902240924DOWJONESDJONLINE000353_FORTUNE5.htm
EU Mulling Ordering Microsoft To Carry Rival Web Browsers
http://money.cnn.com/news/newsfeeds/articles/djf500/200902240721DOWJONESDJONLINE000284_FORTUNE5.htm
Microsoft fears EU fine over browser
http://www.iht.com/articles/2009/02/24/technology/msft.4-437077.php
- From the Comes Petition:
Microsoft’s Predatory Response to Netscape’s Navigator
159. Microsoft III addressed actions taken by Microsoft to maintain the
applications barrier to entry--and thus protect its monopoly power in the
operating systems market---once Microsoft had successfully eliminated threats
from DR-DOS and OS/2. The course of Microsoft’s misconduct directed at
Netscape’s Navigator web browser is the subject of numerous conclusively
established factual findings and legal conclusions from the government action,
as detailed in this section.
160. Netscape Navigator possessed middleware attributes that gave it the
potential to diminish Microsoft’s applications barrier to entry. First, it was
a complement to (not a substitute for) Windows, and therefore could gain
widespread use. Second, it could serve as a platform for other software,
particularly network-centric applications that work in association with Web
pages. Third, Navigator had been ported to more than fifteen different
operating systems. If a developer wrote an application that relied on the APIs
exposed by Navigator, that application would, without any porting of its own,
run on many different operating systems.
161. As was established in Microsoft III, Navigator began to enjoy tremendous
public acceptance shortly after its release in December 1994. Microsoft soon
thereafter recognized the damage Navigator could cause its operating system
monopoly. In a May 1995 memorandum, Bill Gates, the Chairman and CEO of
Microsoft, described Netscape as a "new competitor ’born’ on the Internet." He
warned that Netscape was "pursuing a multi-platform strategy where they move
the key API into the client to commoditize the underlying operating system."
In other words, Netscape’s browsers threatened to reduce or eliminate the key
barrier to entry that protected Microsoft’s monopoly power in flat operating
systems software market.
162. As noted above, the applications barrier to entry, consisting of the large
number of software applications that will run On the Windows operating system
but not on other operating systems, has precluded potential developers of
alternative operating systems from effectively competing with Windows on the
desktop. If, however, applications could be written to run on multiple
operating systems, then competition in the market for Intel-compatible PC
operating systems could be reinstated. Microsoft recognized that browser
technology, in combination with Sun Microsystems’ Java technologies, held out
exactly that prospect, a threat which was altogether ominous for Microsoft
when Mr. Gates wrote his "Internet Tidal Wave" memorandum in May 1995.
163. Java was designed to permit applications written in its language to be run
on multiple operating systems for Intel-compatible PCs, including but not
limited to Windows. Given that facility, Java-based applications are not
restricted to Windows as their only operating system, as was previously the
case with other applications. That daunting restriction has constituted the
very foundation of the applications barrier to entry into the market for
operating systems for Intel-compatible PCs that Microsoft created and
continues to enjoy. The distribution of Java through Internet browsers that
compete with Microsoft’s Internet Explorer therefore threatened to eliminate
the applications barrier to entry protecting Microsoft’s monopoly of operating
systems for Intel-compatible PCs. It correspondingly threatened to obliterate
Microsoft’s power to license its Windows operating systems for
Intel-compatible PCs at monopoly prices, without regard to competition, in
excess of what Microsoft would be able to charge in a competitive market.
164. At the time Microsoft began its anti-competition campaign against
Netscape, non-Microsoft Interact browsers were the most significant means of
distributing Java technology to
end users. Microsoft recognized that the widespread use of browsers other than
its own Internet Explorer threatened to increase the distribution and use of
Java, and in so doing threatened Microsoft's operating system monopoly by
weakening the applications barrier to entry. Microsoft therefore determined
aggressively to use its Internet Explorer to counter the threat to Microsoft’s
operating system monopoly presented by Java. A presentation to Microsoft
Chairman Bill Gates on January 5, 1997, discussing how to respond to the Java
threat, emphasized "Increase IE share" as a key Microsoft strategy.
165. Microsoft separately recognized that Netscape’s Navigator browser was
itself a "platform" to which many applications were being written. Microsoft
realized that if Navigator thrived, more and more applications would be
written using Navigator as a platform. Because Navigator could be run on
various PC operating systems (including numerous non-Microsoft operating
systems), the success of this alternative platform also threatened to reduce
or eliminate the applications barrier to entry which protected Microsoft’s
operating system monopoly. Navigator--alone and in conjunction width
Java---also threatened Microsoft’s monopolies in word processing and
spreadsheet applications software.
166. To respond to the competitive threat to Microsoft’s operating system
monopoly posed by Netscape’s Navigator browser, both as a platform and as a
vehicle for distributing Java, Microsoft determined to embark on an extensive
and aggressive campaign to market and distribute Microsoft’s Internet Explorer
browser and to impede the distribution of Navigator. Microsoft described its
campaign as a "jihad" to win the "browser war." Microsoft embarked on
that "jihad" because winning the "browser war" was essential to its ability to
preserve the applications barrier to entry and to thereby preserve Microsoft's
power to license its Windows operating systems at monopoly prices. Itwas also
necessary to preserve Microsoft’s ability to
license its Word and Excel applications at, supra-competitive prices.
167. On information and belief Microsoft’s exclusionary campaign against
Netscape continued even after the trial in Microsoft III.
Attempted Allocation of Browser Market
168. Microsoft first attempted to eliminate competition from Netscape by
soliciting an express horizontal agreement not to compete. Microsoft
executives met with Netscape executives for the purpose of inducing Netscape
not to compete with Microsoft and to divide the browser market under the
proposal it presented to Netscape. Microsoft would be the sole supplier of
browsers for use with Windows 95 and successor operating systems, and that
Netscape would be the sole supplier of browsers for operating systems other
than Windows 95 and its successors. Netscape refused to participate in
Microsoft’s patently unlawful market allocation scheme.
169. Microsoft refused to abandon its anticompetitive strategy. Instead, it
escalated its predatory course of conduct aimed at eliminating the browser
threat to the Windows operating system monopoly. Microsoft thereupon Set out
to exclude Netscape and other browser rivals from access to the distribution,
promotion, and resources that they needed in order to be competitive. To be
successful, browser rivals such as Netscape would need to be able to offer
their browser products to OEMs and PC users at a level sufficiently pervasive
to facilitate the widespread distribution of Java, or to facilitate their
browsers becoming an attractive programming platform in their own fight. As
has been shown above, those two potential scenarios would, either alone or in
combination, erode the applications barrier to entry that is the basis of
Microsoft’s operating system monopoly. Microsoft was determined not to let
either scenario come to pass.
170. Microsoft sank hundreds of millions of dollars into the testing and
promotion of Internet Explorer, and then distributed that product without
separate charge. Such actions would only make sense to a predatory monopolist.
As if any further explanation of that behavior were necessary, Microsoft’s
Vice President in Charge of the Platforms Group told industry executives: "We
are going to cut off [Netscape’s] air supply. Everything they’re selling,
we’re going to give away for free." And Microsoft’s Chairman Bill Gates
boasted in June 1996: "Our business model works even if all [of Microsoft’s]
Internet software is free .... We are still selling operating systems. What
does Netscape’s business model look like? Not very good."
171. In addition to free distribution of Internet Explorer, Microsoft did
whatever it took to make sure significant market participants distributed and
used Internet Explorer instead of Netscape’s Navigator, including paying some
customers to take IE and using its Windows monopoly power to induce others to
do so. Mr. Gates was blunt in seeking the support of Intuit, a significant
application software developer, as he reported in a July 1996 Microsoft
e-mail: I was quite frank with him [Scott Cook, Chairman of Intuit] that if he
had a favor we could do for him that would cost Us something like $1M to do
that in return for switching browsers in the next few months I would be open
to doing that.
172. All told, Microsoft’s campaign against Netscape ultimately involved a
range of anti-competitive acts, including, inter alia:
a. After Netscape refused Microsoft’s offer to divide the Web browsing market,
Microsoft withheld crucial technical information from Netscape. At a meeting
in June 1995, Netscape representatives requested technical information from
Microsoft. A Microsoft representative indicated that Netscape’s response to
Microsoft’s offer of a "special relationship" would determine whether Netscape
received this information immediately or in three months. Subsequently,
despite
Netscape’s repeated requests for this information, Microsoft withheld it until
late October, more than three months later. The delay forced Netscape to
postpone the release of its Windows 95 browser, causing it to miss most of the
holiday selling season;
b. Microsoft withheld a scripting tool that Netscape needed to make its browser
compatible with certain ISPs. In mid-August 1995, a Microsoft representative
informed Netscape that Microsoft was linking the grant of a license for the
scripting tool to the resolution of all open issues. Netscape never received
the license and, as a result, was unable for a time to do business with
certain ISPs;
c. Microsoft conditioned the placement of an Internet Service Provider on
the "Internet Connection Wizard" screens or in the Online Services folder in
Windows 95 on the ISP’s agreement to deny most or all of its subscribers a
choice of Internet browser. At the time, approximately one-third of Interact
browser users obtained their browsers from their service provider, so
Microsoft’s exclusionary agreements with these firms had a substantial
foreclosure effect on Netscape Navigator and other browsers;
d. Microsoft entered into exclusionary agreements with Internet Content
Providers such as Disney, Hollywood Online, and CBS Sportsline, which provide
news, entertainment, and other information from sites on the Web. In order to
achieve priority placement on the Windows desktop screen after installation of
Internet Explorer, Microsoft required ICPs to agree: (i) not to compensate
manufacturers of "other browsers" (defined as either of the two top
non-Microsoft browsers) by distributing its browser or by payments to the
other browser for distributing,
marketing, or promoting the ICP content; (ii) not to promote any other browser;
(iii) not to allow any other browser to promote the ICP channel content; and
(iv) to design the ICP Web sites using Microsoft-specific programming
extensions so that the sites looked better with Internet Explorer than with a
competing browser;
e. Microsoft imposed license restrictions that prevented OEMs from altering the
Windows 95 boot-up sequence. These restrictions increased Microsoft’s ability
to require preferential treatment for Internet Explorer from ISPs and ICPs in
return for access to the Windows desktop. These restrictions also limited an
OEM’s ability to substitute or feature a non-Microsoft browser or other
application;
f. Microsoft bundled Internet Explorer with Windows 95 in licensing agreements
with OEMs, in order to foreclose choice by OEMs;
g. Microsoft tied, both contractually and technically, Internet Explorer to
Windows 98 and subsequent versions of Windows.
173. The result of Microsoft’s campaign against Netscape Navigator was a
dramatic reversal in market share. Navigator’s share fell from above 80
percent in January 1996 to 55 percent in November 1997, and Internet
Explorer’s share rose from five percent to 36 percent over the same period.
Internet Explorer’s share by the latter part of 1998 had reached approximately
50 percent. IE’s share has been steadily rising as Windows 95 users have
converted to Windows 98 and to subsequent versions of the operating system.
Recent estimates place Internet Explorer’s share at more than 90 percent of
the market.
Microsoft’s Licenses Issued to Original Equipment Manufacturers
174. In its continuing "jihad" to win the "browser war" Microsoft has gone to
the extreme of controlling the content of the computer screen that the PC end
user sees, To that end,
Microsoft abused its Windows operating system monopoly by requiring OEMs to
agree, as a condition of acquiring a license to the Windows operating system,
to adopt the uniform "boot-up" sequence and "desktop" screen that Microsoft
has dictated. The "boot" sequence determines the screens that every user sees
upon turning on a Windows-based PC. Microsoft’s exclusionary restrictions also
prohibited, among other things, any changes by an OEM that would remove from
the PC any part of Microsoft’s Internet Explorer software. OEMs were also
prohibited by Microsoft from adding to the PC a competing browser in any more
prominent or visible way than the way Microsoft required Internet Explorer to
be presented.
175. Beginning in or about August 1996, Microsoft prohibited sellers of
personal computers from altering the Windows 95 boot sequence. Specifically,
Microsoft’s license agreements prohibited OEMs from:
a. Modifying or obscuring the sequence or appearance of any screens displayed
by Windows from the time the user first begins the boot-up process with a new
personal computer until the "Welcome to Windows" screens have run and the
Windows desktop screen first appears;
b. Modifying or obscuring the sequence or appearance of any screens displayed
by Windows on all subsequent boot-ups unless the purchaser initiates some
action to change the sequence;
c. Displaying any content, including visual displays, sound, welcome or
tutorial screens, until after the Windows desktop screen first appears;
d. Modifying or obscuring the appearance of the Windows desktop screen, beyond
a narrowly limited range of permitted changes; or
e. Adding a screen that would automatically appear after the initial boot-up
sequence or in place of the Windows desktop screen.
176. These anti-competitive restrictions preserved the advantageous desktop
position that Microsoft secured for Internet Explorer and other Microsoft or
Microsoft-designated software. The restrictions also foreclosed competing
Interact browsers from securing preferential placement on PC desktops, and
foreclosed OEMs from choosing among competing browsers on the merits. The
effect of these restrictions was significantly to restrict the access of
competing browsers to the important OEM channel and thereby fortify
Microsoft's personal computer operating systems monopoly.
177. As described above, several OEMs (including MicronPC, Hewlett-Packard, and
Gateway) requested that Microsoft allow them to provide new personal computer
purchasers with an alternative user interface, boot-up sequence, or initial or
default screens. Microsoft refused these requests.
178. Microsoft recognized that its control over the desktop screen gave
Microsoft a strategic advantage in the provision of software, advertising and
promotion. Microsoft intended by its anti-competitive restrictions to
consolidate that power.
179. As the D.C. Circuit recognized in Microsoft III, these exclusionary
restrictions (with the minor exception of the prohibition against launching
user interfaces that "automatically prevent[ed] the Windows desktop from ever
being seen") were not reasonably necessary to further any legitimate,
pro-competitive purpose and furthermore impaired competition in an
unnecessarily restrictive way.
180. Microsoft’s exclusionary contracts thereby foreclosed Netscape from access
to customers, and further impeded their ability to distribute Java and other
software capable of
eroding Microsoft’s operating systems monopoly. Such exclusionary conduct also
suppressed the development of newer secure browsers.
Contractual and Technological Bundling of Internet Explorer with Windows
181. Internet Explorer is recognized by both Microsoft and the industry as a
distinct product separate and apart from Windows, For example:
a. Microsoft has sold Internet Explorer separately at retail, distributed it
separately through the Internet, and paid for it to be distributed separately;
b. Microsoft has distributed Internet Explorer as a separate product through
Internet Service Providers and other channels and has conditioned the access
of numerous companies (e.g., Internet Content Providers and Internet Service
Providers) to Windows facilities on such companies’ distribution of Internet
Explorer as a separate product;
c. Microsoft and the industry have separately tracked browser market share and
operating system software market share;
d. Microsoft has bundled stand-alone versions of Internet Explorer with other
application programs (e.g., Word, Works, Enema);
e. Microsoft has promoted, and has enlisted others to promote, the distribution
and use of Interact Explorer as a separate product;
f. Internet Service Providers consider Internet Explorer to be a separate
product from Windows and, recognizing the demand for a browser separate from
the operating system software, Microsoft has deliberately marketed it as such
to Internet Service Providers;
g. Interact browsers and operating system software perform different functions;
and
h. Microsoft has marketed--and continues to market--Interact Explorer for
non-Windows operating system software, including operating system software
produced by Apple. Indeed, Microsoft devoted substantial effort in developing
these versions of its Interact Explorer in order to foreclose opportunities
for non-Microsoft browsers to establish themselves).
182. There is demand for Internet browsers that is separate from the demand for
Microsoft’s operating system software. For example:
a. Many personal computer Users (who, of course, require an operating system)
do not need or want a browser;
b. For many customers, the forced inclusion of a browser with the operating
system software is a significant negative---including corporate customers who
do not want their employees connected to the Internet and customers that would
prefer a different browser. Microsoft has acknowledged that some sellers of
personal computers and personal computer users want to be able to delete
Interact Explorer from Windows and previously provided the ability, through
the "Add/Remove" utility, for them to do so; and
c. Other personal computer, customers want an up-to-date Windows operating
system together with non-Microsoft browsers.
183. Microsoft recognized that it could not compete with Netscape on the
merits. As Microsoft’s Christian Wilfeuer wrote in February, 1997, Microsoft
had concluded that it would "be very hard to increase browser share on the
merits of [Internet Explorer] alone. It will be more important to leverage the
[operating system] asset to make people use [Interact Explorer] instead of
Navigator." To leverage its operating system, Microsoft tied the
implementation of
Windows 98 (and subsequent versions of Windows) with Internet Explorer, so that
IE could not be simply uninstalled. Moreover, even if Netscape Navigator is
chosen as a default browser, Windows 98 (and subsequent versions of Windows)
is written to override the user’s choice in certain circumstances. As Brad
Chase of Microsoft wrote to his superiors near the end of 1995, "We will bind
the shell to the Interact Explorer, so that running any other browser is a
jolting experience."
184. Even before it bound Internet Explorer to Windows with "technological
shackles," though, Microsoft began tying Internet Explorer to Windows
with "contractual shackles." Microsoft unlawfully required OEMs, as a
condition of obtaining licenses for the Windows 95 operating system, to agree
to license and pre-install Interact Explorer on every Intel-compatible PC that
they shipped with Windows 95 pre-installed. Windows’ monopoly position made it
a commercial necessity for OEMs to pre-install Windows 95 on virtually all of
the PCs they sold. Microsoft thereby unlawfully leveraged its operating system
monopoly to require PC manufacturers to license and distribute Interact
Explorer on every PC those OEMs shipped with Windows, with the purpose and
effect of foreclosing Netscape’s Web browser, which (as described above)
threatened to erode the applications barrier to entry sustaining Microsoft’s
operating systems monopoly.
185. Microsoft bundled its Internet Explorer software with Windows 95 not
because Microsoft believed the market wanted only a bundled product but rather
to foreclose choice by personal computer sellers and ultimately their
customers.
186. Microsoft recognized that such restrictions were necessary to build
Interact Explorer’s market share and to foreclose the important OEM channel to
Navigator. By foreclosing personal computer choice, Microsoft substantially
foreclosed Netscape from a
significant channel of distribution, and as a consequence suppressed
competition with the Windows operating system software monopoly.
187. These exclusionary restrictions were not reasonably necessary to further
any legitimate pro-competitive purpose and furthermore the restrictions
impaired competition in an unnecessarily restrictive way. Microsoft has
distributed--and continues to distribute Internet Explorer separately from its
Windows operating system software, and it is efficient for it to do so.
Microsoft could also efficiently distribute or permit the distribution of
Windows without Microsoft’s Internet browser software.
188. Recognizing that its contractual restrictions on OEMs "would not be
sufficient in themselves to reverse the direction of Navigator’s usage
share... Microsoft set out to bind [Internet Explorer] more tightly to Windows
95 as a technical matter." Findings of Fact ¶ 160.
189. Microsoft designed Windows 98 (and subsequent versions of Windows) so that
removal of Internet Explorer by OEMs or end users is operationally more
difficult than it was in Windows 95. Microsoft undertook several measures to
bind "Internet Explorer to Windows with.., technological shackles."
Conclusions of Law at 39. These included, inter alia, excluding Internet
Explorer from the Add/Remove Programs utility in Windows and commingling code
relating to browsing with other code in the same files so that any attempt to
delete the files containing Internet Explorer would cripple the operating
system.
190. Although it is nevertheless technically feasible and practicable to remove
Microsoft’s Internet Explorer browser software from Windows and to substitute
other Internet browser software, OEMs were prevented from doing so by
Microsoft’s contractual tie-in. Microsoft has thus continued this practice,
begun with Windows 95, with the unlawful purpose and effect of foreclosing
Netscape’s Web browser, thereby preserving the applications barrier to
entry sustaining Microsoft’s operating systems monopoly. The net result of this
unlawful activity is higher prices for Plaintiffs and members of the Classes.
Exclusionary Agreements with Internet Access Providers (ISPs)
191. Microsoft entered into anti-competitive agreements with major Internet
Access Providers for the exclusive or nearly exclusive distribution of
Internet Explorer.
192. Starting in early 1996, as a condition for placement of an ISP on
the "Internet Connection Wizard" screens or the Online Services folder in
Windows 95, Microsoft began to require Internet Access Providers to agree to
deny most or all of their subscribers a choice of Internet browser.
193. Microsoft’s restrictions on the ability of OEMs to modify the boot
sequence or otherwise alter the appearance of Windows enhanced Microsoft's
ability to provide preferential placement on the desktop and in the boot-up
sequence to various Internet Access Providers in return for those firms’
commitments to give preferential distribution and promotion to Internet
Explorer and to restrict their distribution and promotion of competing
browsers.
194. As a result, these restrictions further exclude competing Internet
browsers from the most important channels of distribution, and are therefore
other means by which Microsoft has used the virtual universality of its
Windows operating system monopoly to maintain the applications barrier to
entry that competing Internet browsers have threatened to erode by
distributing Java and becoming platforms that could substitute for Windows.
195. In its agreements with ISPs, Microsoft leveraged its operating system
monopoly by imposing the requirements that the ISPs offer Microsoft’s Interact
Explorer browser primarily or exclusively as the browser they distribute; that
they refrain from promoting or mentioning to their subscribers the existence,
availability, or compatibility of any competing Internet browser;
and that they use on their own Internet Sites Microsoft-specific programming
that makes those sites look better when viewed through Internet Explorer than
when viewed through competing Internet browsers; that they eliminate links on
their web sites from which their subscribers could download a competing
browser over the Internet; that they include Internet Explorer as the only
browser they ship with their access software (i.e., the software that enables
a personal computer user to subscribe to the service) most or all of the time;
and that they limit the percentage of competing browsers they distribute, even
in response to specific requests from customers.
196. Microsoft’s agreements with Interact Access Providers also required the
IAPs to use Microsoft-specific programming extensions and tools in connection
with the ISP’s own web sites. Web sites developed with these
Microsoft-specific programming extensions and tools will consequently look
better when they are viewed with Internet Explorer than with a non-Microsoft
browser.
197. Under Microsoft’s ISP contracts, the penalty for promoting a competing
browser, for distributing a competing browser more than permitted by
Microsoft, or for otherwise failing to provide preferential treatment for
Microsoft’s Interact browser, was deletion from the Windows desktop. Even the
largest Interact Access Providers were unwilling to risk this penalty.
198. Microsoft recognized the importance to Internet Access Providers of
favorable placement on Windows screens. For example, Brad Silverberg
(Microsoft's former Senior Vice-President of its Applications and Internet
Client Group) described such placement as "a distribution facility" for
service providers that is of "tremendous value to them."
199. Approximately one-third of Internet browser users obtained their browsers
from their service provider; hence Microsoft’s exclusionary agreements with
those firms substantially
foreclosed Microsoft’s browser competitors from a vital means of distribution.
200. The exclusionary restrictions in Microsoi’s IAP agreements were not
reasonably necessary to further any legitimate procompetitive purpose and
impaired competition in an unnecessarily restrictive way.
201. Microsoft’s exclusionary ISP contracts, expressly targeted at its primary
Internet browser competitors, further foreclosed non-Microsoft browser
developers from access to customers and further impeded their ability to
distribute Java and other software capable of eroding Microsoft’s operating
systems monopoly.
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