Browser battle v2: Opera's complaint about Microsoft IE may fly in Europe

It's the brower war v. 2.0.

No doubt, Opera’s antitrust complaint filed against Microsoft today to the European Commission is causing huge headaches in Redmond.

The Norwegian company, whose pioneering open source browser rose to prominence on mobile devices, claims that the company’s integration of IE with Windows is anti-competitive and that it is hindering interoperability by not using accepted Web standards. That complaint follows a related one filed earlier to the commission by Microsoft’s American rivals, IBM and Oracle, leaders of the European Committee for Interoperable Systems, or ECIS, about Microsoft’s “continuing abusive business practices" to the European Commission.

Microsoft’s first browser war with then-upstart Netscape (whose code is now part of the other open source browser, Firefox), and subsequent antitrust case, ended with a slap on the wrist after the U.S. court upheld a consent decree and light sanctions imposed on the company after it was found guilty of violating two sections of the Sherman Antitrust Act.

But now we’re talking about the European court, which has not given Microsoft a break to date. The European Court of First Instance on September 17 upheld serious penalties imposed on Microsoft in 2004 by the European Commission for alleged anti-competitive misdeeds. As part of that, Microsoft was forced to ship a stripped down version of Windows without a media player in the European market -- known as Windows XP Home and Pro N) and pay a $610 million fine. The EC also told Microsoft to offer server communication protocols for licensing by competitors.

Will it now be forced to now ship a stripped down version of Windows Vista without Internet Explorer?

It’s possible. The Europeans have been tough on Microsoft at every turn. All of Microsoft's appeals have been dismissed. After Microsoft defiantly shipped its browser sans media player to the European market as Windows XP Reduced Media Edition, the European Commission issued a stinging rebuke and told Microsoft to remove that branding along with the code. When Microsoft reportedly dragged its feet opening up those server protocols, and at a fair price, the European Commission threatened to fine the company almost $4 million per day for non compliance.

Microsoft’s attorneys claimed vigorously in the U.S. courts that removing IE from Windows would render the product unusable, but that argument is not likely going to sell overseas. Microsoft’s ability to componentized and remove media player fand spin off IE 7 for Windows XP suggests that carving code out of Vista is a technical possibility.

It is unclear whether Microsoft would be forced to unbundle Internet Explorer from Vista – or bundle competitors’ browsers. Many Windows customers enjoy the convenience of having the web browser integrated into the operating system. And market reports suggest that OEMs or consumers had much demand for N Windows sans Media Player.

Secondly, forcing one company to help deliver competitors’ products to market is draconian, and absurd. I downloaded Opera 9.24 to my Vista PC today and a dialog box immediately popped up asking me if I would like to make Opera my default browser. Nothing anti-competitive about that.

But there's no doubt Microsoft is vulnerable on the standards as well as on the browser front. Microsoft pronounced boldly that it would embrace XML but many of its proposed XML extensions and schemas, deemed custom spins on web standards, led to an outcry within the open source community and proprietary rivals backing web standards. Consider the controversy surrounding Microsoft’s ECMA submissions and the ongoing Open XML versus ODF battle.

Opera's complaint on Thursday outlined its objections. Opera "asks the European Commission to require Microsoft to follow fundamental and open Web standards accepted by the Web-authoring communities. The complaint calls on Microsoft to adhere to its own public pronouncements to support these standards, instead of stifling them with its notorious Embrace, Extend and Extinguish strategy," Opera's press release stated. "Microsoft's unilateral control over standards in some markets creates a de facto standard that is more costly to support, harder to maintain, and technologically inferior and that can even expose users to security risks."

Detractors claim that Microsoft’s proposed web standards – such as Open XML – are proprietary APIs that inhibit – rather than encourage – interoperability. If Microsoft complied with standards set by industry consensus, detractors argue, why would there be needs for it to concoct special interoperability deals with Novell and others?

Microsoft, for its part, issued a statement to the Wall Street Journal that it would cooperate with an investigation but claimed that Opera’s claim is baseless. “Users prefer the integration of a web browser with Windows and that Vista users have “complete freedom of choice to use and set as default any browser they wish, including Opera."

In October, one Microsoft standards executive said Microsoft still has a ways to go on the interoperability front but is adopting web standards even as it tries to hold on to a competitive advantage. “Interoperability cannot equal homogeneity. You have to balance that with innovation,” Microsoft standards chief, Tom Robertson, said at Interop in New York in October.

Microsoft likely knew the Opera complaint was coming. In the last week, Microsoft announced availability of three Open XML-ODF translators on SourgeForge.net for text documents, presentations and spreadsheets and released a list of ECMA dispositions that have been settled (addressing about half of concerns raised) as the company tries to gain acceptance of OpenXML as a standard.

Forcing Microsoft to strip IE out of Windows or abandon its web standards charge could be a major setback for Microsoft, which still owns more than 93 percent of the PC desktop market.

Microsoft co-founder and chairman Bill Gates beamed of glory after the U.S. antitrust was settled in his favor, particularly since the penalties and remedies did not interfere with Microsoft’s product design and integration rights.

I covered the Microsoft antitrust case in Washington as a reporter during the late 1990s and early 2000s and endured hours of technical dissections about “commingling” code and the legality of “tying” IE to Windows. In an interview with Bill Gates in 2001, I pressed the Microsoft co-founder on the legitimacy and legality of “commingling” code and tying IE – as well as the rest of its software stack – to Windows. I asked him if he was worried that the court would rule how he could -- and should -- design his software.

He would not comment on his thoughts about that but rather insisted that the US court’s decision was limited to the browser and that the decision was “totally pro-integration.”

"This was a case about browsers. And that's what it was about," Gates said in our interview.

As he prepares to depart from his day-to-day duties at Microsoft this summer, it looks like Gates & Co has one more legal hurdle to clear in order to protect its mega empire. And yes, it is about the browser. And that’s what it is about.