IP: *Everybody* is getting into the act!

[David Farber <dave () farber net>]

> From: "Janos Gereben" <janos451 () earthlink net>
>
>       EU fires another salvo at Microsoft
>       Dawn Hayes - www.the451.com
>
>       London - It's 1995 all over again. Microsoft's practice of
> integrating Windows Media Player (WMP) software into its Windows
> operating system has drawn the ire of regulators, who continue to
> shadow the company's every move. On Thursday, the European
> Commission's competition directorate opened an investigation into
> whether Microsoft's integration strategy with WMP contravenes
> competition rules.
>
>       Windows XP is claimed to be easier for consumers to use because
> of its integration of more formerly discrete products. With the
> Windows XP operating system set for release in October, the European
> Commission has sent Microsoft a statement of objection about the
> integration of WMP, according to the Wall Street Journal. How much
> detriment that integration will bring to companies in markets ranging
> from digital music and streaming video to digital rights management is
> the question regulators are looking into.
>
>       Once again, AOL will be leading the lobbying efforts against
> Microsoft, arguing that it is still using its dominant position in the
> operating system market to promote its other software products. AOL
> was the main opponent in 1995 to Microsoft's attempts to bundle MSN
> with Windows, and once more it has the most at stake in lobbying to
> get a brick wall erected between Microsoft's streaming media software
> and its operating software.
>
>       Microsoft and AOL Time Warner are vying to become the de facto
> intermediary between end users and the Internet with their respective
> universes of software and services. AOL's preferred media software
> supplier is RealNetworks, which is Microsoft's main rival in the
> streaming media market. AOL and RealNetworks are in cahoots on
> MusicNet, an attempt to create a Napster-like subscription service.
> Not surprisingly, Microsoft is batting for the other side - a rival
> music joint venture between Sony and Universal, dubbed pressplay.
> Could bundling in WMP with XP tilt the market for online music in
> favor of pressplay? It's one of the possibilities the EC will ponder.
>
>       And don't forget that the enterprise market is expected to
> embrace streaming media applications sooner than the consumer market.
> Bundling WMP with Microsoft's server software could be key to gaining
> share in this market against Real's server software, which is an
> extra-cost item that IT departments might well forgo in a down
> economic climate.
>
>       An important component of both the retail and enterprise
> streaming media markets is digital rights management technology. WMP
> has DRM capabilities built-in. Here too, the EC may be looking at
> whether the company can gain an unfair advantage over companies like
> InterTrust, SealedMedia and the like.
>
>       Apart from bundling WMP, Microsoft's development of
> identification services may also draw attention. Services such as
> Microsoft's Passport allow customers to log onto multiple websites in
> one easy step. In return, those websites and network operators are
> able to track customers more closely, since their personal
> information, including email address, phone number and potentially
> their credit card information, is held in a central database. In
> addition to its identification service, Microsoft hopes to host its
> Web-oriented transaction service architecture, Hailstorm, on its own
> network of data center servers, giving it control over access to
> customer information. AOL is developing its own counterpart
> identification and transaction service.
>
>       For all the blustering between AOL, Real and Microsoft, the
> media player market is still in the formative stages. The rollout of
> broadband networks has been slower than expected, which means that
> streaming media is little more than a postage stamp-sized video
> experience on the desktop right now. Still, it is a cornerstone of
> both Microsoft's and AOL Time Warner's Internet strategies because it
> is regarded as a key technology that will keep viewers tuned into
> their services.
>
>       Analysts were largely unconcerned about the European regulator's
> move. Lehman Brothers said Microsoft can easily address the issue by
> making Windows Media Player an add/remove option. Also, Microsoft has
> been bundling WMP with its operating system for years, but has yet to
> overtake rival RealNetworks' leadership position. According to the
> latest figures from Jupiter MMXI, as of June, RealNetworks' player
> software had 32.7 million home users, while Windows Media Player had
> 22.1 million and Apple's QuickTime had 7.8 million.
>
>
> ~~~~~~~~~~~~~~~~
> Janos Gereben/SF
> janos451 () earthlink net



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