As much we would like to deny it, there is a certain amount of antipathy in some areas between the US and the EU these days. One of those areas is perceived US technology monopolists such as Microsoft and Apple. However, unlike Apple, the reaction of the general public to recent the European Commission (EC) action of fining Microsoft is not winning the software company much sympathy from users.
Microsoft was fined about US$357 million last week by the EC for
failing to diminish its software monopoly in a timely fashion, bringing
the total of EU fines against the software company up to around US$1
billion since 2004.
It seems that more than a fair share of Microsoft financial statements
in recent times has included some sort of settlement affecting the
company's bottom line. That of course does not include the legal fees
that Microsoft has been forced to pay out to keep its many litigants at
bay, plus the teams of specialists it employs solely to satisfy the
requirements of antitrust regulators in the US and EU.
Only a company with an enviable bottom line like Microsoft's could
afford to withstand such sustained financial hostility and still retain
a robust and growing bank balance.
Perhaps it is Microsoft's demonstrated resilience and seemingly
impervious financial position that is behind the results of the latest
iTWire poll, which appears to show that a clear majority of readers
believe the EU is acting fairly in fining Microsoft recently.
The iTWire poll asked: "Are EU antitrust regulators being overly
zealous in prosecuting Microsoft?" Of the respondents, 69.2% answered
no, 30.8% answered yes. The clear implication is that more than 2 out
of 3 readers who bothered to respond to the poll believe that Microsoft
is getting what it deserves from EU regulators.
The response was in stark contrast to an iTWire poll last month which
asked the question: "Should Apple be forced to make iTunes compatible
with portable players other than iPod?" Of the respondents, 56.4%
answered no, while 43.6% answered yes.
Both Microsoft and Apple built their dominant market positionsin the face of stiff competition.
When Microsoft was a minnow, IBM was considered an unassailable giant. Microsoft changed the computing paradigm.
When Apple was in the wilderness for more than a decade, pirate MP3
downloads proliferated and the MP3 player market was well established.
Apple created iTunes and iPod and changed the paradigm to legal
downloads.
So why the difference in reaction to the treatment of Microsoft's
desktop platform monopoly from EU regulators and Apple's music store
platform monopoly from French and, soon to follow, Scandinavian
regulators. Are what the companies doing so different?
The answer possibly lays in the fact that there are many Microsoft
users out there who currently resent the fact that they're being forced
to pay through the nose for software that they're locked into which is
malware prone, requires costly support and constantly requires updates
and extra security software just to keep it safe from unwanted
intruders.
What's more, users keep getting promised a whizz-bang new version that
is always a few months away, but never seems to be materialize.
When it does finally materialise, they will once again have to pay
through for the nose not just for the new software but also the new
hardware capable of running it.
The near monopoly that Apple has created appears to be quite different.
Against well established competition, Apple has created an online music
store that has forced music companies to allow consumers to download single
music tracks at fair prices.
Because of the thin margins for Apple, the company does not make much
on the store. However, being a hardware company that specialises in
design excellence, it has created a phenomenally popular music player
device designed to operate exclusively with its own store.
If users choose not to, they can buy another music player and download
music from other stores. It's their choice and they'll be able to hear
exactly the same music at similar prices. However, most consumers
choose not to because they like the Apple product and have no objection
to being locked into its business model. In fact, Microsoft plans to
duplicate it.
So the question again, is why do people feel sympathy for Apple in its
fight against EU regulators and not for Microsoft? Perhaps it's because
Apple so far has delivered excellent products for music listeners,
while the same cannot generally be said for Microsoft. {moscomment}
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