[clug] Beware of Microsoft's technology empire (Shanghai Daily Op Ed)

[Simon Cousins]

Beware of Microsoft's technology empire

Shanghai Daily Op Ed (May 17, 2004)

It would be a harmful thing if all information technology products were to
bear one company's logo - Microsoft.

The US-based company partnered with China United Telecommunications Corp at
the end of last month to promote a new high-end handset with Windows Mobile
2003 - a similar program to the personal computer version of Windows. 

The handset, with a retail price of more than 8,000 yuan (US$960), is
available in major cities such as Shanghai and Beijing. 

That's cool. Chinese consumers can now use mobile phones as portable PCs as
more and more content services are provided on the handset platform. 

Consumers are willing to use an operating system they are familiar with,
said Wei Qing, mobile division director of Microsoft China. 

It's the first time that the overseas software giant officially partnered
with a leading homegrown company in China's telecom industry. 

China Unicom is the smaller of the country's two mobile operators with about
100 million handset users. 

Microsoft also has partnered with 37 companies in the industry across the
world including Motorola and Samsung. The company's market share of the
handset operating system in China is expected to rise. 

Windows Mobile's share will double to 12.8 percent this year in China,
according to Beijing-based CCID Consulting Co Ltd, a research firm
authorized by the Ministry of Information Industry. 

Meanwhile, the current dominant product, Nokia's Symbian, is expected to
drop 7 percentage points to a 38.8 percent share of the market this year. 

China Mobile Communications Corp, the country's biggest mobile operator,
will begin promoting handsets with Windows Mobile at the end of this month. 

Although relatively new to China, Windows Mobile stands to dominate the
country's handset operating system in the future as the third generation era
of telecommunications emerges. 

It's too early to say that Microsoft will seek to monopolize the market as
it did with PC operating systems. But based on its history, the company
needs to be watched closely. 

It is playing some of its controversial old tricks again: bundling
application programs such as media player with the popular Windows system,
and adding unnecessary features to the system. 

In a sense, consumers will ultimately have less choice and face higher
prices for the handsets. 

MSN, Office and Outlook Express are being bundled with the handset operating
system. 

Most people may not need a Word program on a handset, but they have to pay
for the program if they choose to buy a handset powered by Windows Mobile. 

The price of the new handset is more than four times the current average
price for mobiles and double the price of most high-end handsets integrated
with an MP3 player and a digital camera. 

Why is it so expensive? Because people have to pay for several programs
bundled with the software they will likely never use. 

That's unfair. 

Moreover, Microsoft has not opened its source code for Windows. That means
home-grown game developers and program designers will be unable to develop
applications that are 100 percent compatible for the Windows Mobile
platform. 

Therefore, millions of handset subscribers can only use Microsoft's own
programs. 

>From this perspective, Microsoft is likely to stifle innovation in the
programming industry. 

Should adverse effects of Microsoft's dominance be keenly felt over time,
the Chinese government should grant more support to Linux whose source code
is open. 

China can also borrow from the European Union's experience in dealing with
Microsoft. 

Europe has asked Microsoft to reveal more information to its competitors
about how its operating system interacts with software applications such as
Real Network's Real Player and Apple Inc's QuickTime. 

The EU has also demanded the company remove the bundled media program from
Windows, or it will face heavy fines for anti-trust reasons. 

I am not saying that Microsoft's market dominance is a violation of
anti-trust rules. 

As long as it is technologically superb, it is free to dominate a market. 

But once it resorts to controversial means to achieve dominance, Microsoft
should not be given due respect anywhere in the world. 

Windows Mobile is still in its infancy in China and it's too soon to say if
it will develop a monopoly. But let's wait and see what happens. 

May 17 (Shanghai Daily)