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Source code issue shifts balance of decision from Microsoft to EU

Worldwide worry: The EU's decision to uphold sanctions against and fine Microsoft and its chairman Bill Gates, pictured here speaking at "Launch Tour 2007" of Windows Vista in Seattle, will have far-ranging implications globally

It was a tough call, but an EU court ruling upholding sanctions against Microsoft, along with a 497 million euro fine for anti-competitive practices, will have wide-ranging implications globally.

The issue is Microsoft's practice of bundling other software, such as a video and sound media player, with its Windows operating system. The EU argues such bundling, and the refusal to reveal enough details of its source code to competitors, serves to kill the competition.

Whenever I consider this long running case I almost side with Microsoft. On one hand the virtual Microsoft monopoly of the operating system market could serves to stifle innovation and development, against consumer interests. One does not have a lot of alternatives if Microsoft stiffs the customer since about 90 per cent of home computers are using its Windows operating system. You take what you get.

On the other hand, shouldn't a company have the choice of developing and selling what it wants as part of a package? An integrated software package also makes sense.

I guess the source code issue is the one that tips my decision on the side of the EU. Because of Microsoft's dominant position, competitors need some access so as to build compatible, integrated products on a level field as the giant company. Without some access to the source code they have no idea of how buggy a new piece of software will be once people start using it.

The implications are that the EU decision could finally push the company into sharing the necessary bits of its source code to developers, sparking a new round of innovation, and the creation of less buggy products.

Take the example of the RealPlayer media software. The company behind the software is still fiddling with creating a version compatible with Vista, the latest Microsoft Windows operating system. Meanwhile, those of us who have Vista are stuck with only using Microsoft's Media Player.

I do not know whether the fault was due to internal problems with RealPlayer or due to difficulties in preparing for the Vista launch earlier this year.

And while US politicians are complaining about what they claim is Europe's protectionist stance, they only have to look at domestic rulings against Microsoft to understand why the EU is going after the company.

In the US, Microsoft successfully managed to convince an appeal judge to overturn a lower court judgement that would have forced to company to split. Microsoft still had to pay about $4 billion in damages to competitors and remains under court supervision.

At least Bill Gates will be able to drown his sorrow with a bottle of Microsoft branded wine. South African winery Stormhoek created the Blue Monster Reserve label for Microsoft as its savvy marketing strategist, Hugh MacLeod, hangs around with a lot of them. At least he knows enough of the techie world not to call the wine "Big Blue" Reserve, the nickname for IBM. The label also features a cartoon of a sharp-toothed blue creature, with the blurb: "Microsoft - change the world or go home".

Techies who are turning away from the requisite 1.5 litre bottle of fizzy soda will be disappointed however. The new tipple will only be sold to Microsoft employees. Do not be disappointed. I'm sure one or two bottles will show up on E-Bay.

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Managers in Bermuda's financial sector will get an education with Deloitte and Touche's annual global security survey of the industry. You can use the survey results to compare your company's IT security with your peers. In the main the survey continues to reveal what Deloitte is calling the "security paradox" - a situation in which business executives are becoming more aware of IT security issues, but where support for a solution still lies with the IT department. The fact that only 63 per cent of respondents have an information security strategy, and only 10 per cent have information security led by a business line leader highlights the paradox.

Deloitte found that 91 percent of the survey participants are concerned about employee security weaknesses, 79 per cent cite the human factor as the root cause of information security failures, and 66 per cent do not feel they should be accountable for protecting computers of customers who transact with them online.

Get your free copy of the 2007 Global Security Survey at www.deloitte.com under "Research", or in the press section.

If you have any comments send them to Ahmed at elamin.ahmed@gmail.com