In today’s “information society”, most — if not all – commonly used information technology products must be able to communicate, or “interoperate”, in networks with other IT products. There is often confusion over the meaning of “interoperability” in today’s information technology markets, and over the relationship between “interoperability” and “competition.”
- The European Committee for Interoperable Systems (ECIS) believes in a competitive marketplace where consumers can choose and exchange information among the widest number of products.
- Open standards which can be implemented by all entrants in the marketplace allow for interoperability among a vast number of product offerings. Consumers are free to choose among competitive products and determine success or failure in the marketplace.
- Consumer choice flourishes with competition and drives innovation.
Experience around the world shows beyond any doubt that when a monopoly software provider seeks to impose its proprietary standards on the marketplace, competition suffers, interoperability is limited to a restricted set of products, consumer choice is reduced and innovation slows.
A case in point : the Windows monopoly and interoperability
Interlocking monopoly systems and products based on its proprietary Windows standards allow Microsoft to prevent the interoperability of competing products by refusing to supply the essential information to would-be competitors. Microsoft thereby limits competition with its dominant monopoly products.
- In other words, Microsoft uses interoperability not to expand competition and consumer choice but to limit both.
- European consumers are locked into a Microsoft Windows environment.
Fortunately, European anti-trust authorities have found that Microsoft’s refusal to enable interoperability with its monopoly products is illegal under European competition law.
- The European Commission Decision of March 24, 2004 found Microsoft’s refusal to supply interoperability information to other market participants to be a violation of Article 82 of the European Treaty prohibiting the abuse of a dominant position.
- Microsoft was ordered to provide essential interoperability information to permit the development of competing products.
Microsoft knows what it needs to do to comply with the Commission Decision, but three years on still has not done so. Now it seeks to extend the same illegal behavior to the next generation of its dominant products: Windows Vista, Office 2007 and Longhorn Server.
- These new versions perpetuate and expand Microsoft’s illegal anti-competitive practices.
- If not also remedied by anti-trust authorities, the effect will be to reinforce existing barriers to entry, reinforce and extend Microsoft’s existing monopolies, exclude existing competitors and prevent new competition.
What can be done to promote competition through interoperability?
- European competition authorities should remain vigilant to ensure Microsoft’s effective implementation of the remedies to its anti-competitive practices as ordered in March 2004.
- The March 2004 remedies should apply to both existing and future Microsoft products where relevant.
- Consumers should demand software products which implement truly open standards for interoperability, such as the ISO Open Document Format (ODF) supported by various word processing applications.
- European governments and public administrations should avoid lock-in to the products and standards of monopoly suppliers by considering the wider use of Linux and other open standard compliant software products.