Microsoft Media Player-free Windows in Europe from January

Microsoft has lost its appeal to block antitrust sanctions, originally imposed by the European Commission (EC) in March this year.

Back then, along with a record-breaking near 500m Euro fine, the EC insisted that Microsoft should release two version of their Windows operating system, one without the media player built in and one without. The EC see Windows as the dominant computer operating system and want to try to ensure a more level playing field with the playback of digitally held audio and video. Some networking communication protocols were also opened up to compulsory licensing.

The ruling won’t be a surprise to Microsoft but an unhappy result all the same. When we spoke to senior European Microsoft people back in September, they felt this action was likely, but were spinning a line saying that two version of the OS would confuse the public.

It’s possible that the impact on the consumer may be close to zero. Philip Carnelley, research director with Ovum pointed out an interesting possible problem, “The way that part of the ruling was phrased doesn’t prohibit Microsoft from supplying Windows with Media Player at the same price as the version without, so there’s very little room for competition in the market place. If you can get something for free, why would you not take it?” The pricing issue was confirmed in a teleconference held with Microsoft general counsel, Brad Smith.

Smith revealed that company lawyers wanted to look more closely at the 90-page decision before deciding whether to appeal. Smith confirmed that Microsoft would begin complying with the decision immediately, with a version of Windows that doesn’t include Media Player software being made available to European PC manufacturers in January and to resellers by February. Outside of Europe they have no plans to offer a version of Windows without Media Player.

One long term worry for Microsoft could be that this ruling leaves it open for Europe able to question which extra bundled software could or should be included with Windows.

We’ve got a couple of question about the impact of this ruling:-

The Media player part of the ruling appears to only cover “Client PC’s” versions of Windows, not PDA’s or mobile phone version. We think the EC missed a trick here. If anything, the PDA or mobile player would be of more value to change, given its relative high market demand, than the less-than-furiously fought “Client PC’s” space. This oversight could be due to the age of the original legal action, instigated four years ago, when having media play back on a portable device wasn’t at the forefront of peoples minds.

It is not immediately obvious which media player company will benefit from the removal of Microsoft media player. The only major PC maker to currently install Apple’s QuickTime player is HP, following their iPod deal. As far as we’re aware, Real player doesn’t have deals with major computer maker. Perhaps given this ruling they will accelerate their efforts and other entrants will be stimulated to enter.

A confusing thought for you over the holiday period – will there be version of Windows Media Center Edition available Europe without Windows Media player! FYI – When we contacted the Microsoft team in Brussels said they didn’t think so.

Microsoft ruling, Court of First Instance Order on Interim Measures – Court of Justice of the European