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Old 12 Jun 2007, 07:57 PM   #1
BR7
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Default Vista Limits Choices, Google Alleges

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Allegations by Google that Microsoft's new operating system unfairly disadvantages competitors has revived antitrust accusations against Microsoft and opened a front in a bitter war between the two technology giants.

The complaint, which Google raised confidentially late last year, will probably be reviewed later this month by U.S. District Judge Colleen Kollar-Kotelly, who is overseeing Microsoft's compliance with a 2002 consent decree. That agreement resolved the government antitrust case brought against the software maker.

Connecticut Attorney General Richard Blumenthal said yesterday that officials from several states may decide by early next week whether they will ask the judge to force Microsoft to revise Windows Vista, the latest version of the company's operating system.

"We've reached a critical juncture in our decision-making process," he said in an interview. "If Microsoft is misusing its market dominance with Vista to constrain competition or consumer choice, we will seek appropriate action from the court."

The new dispute centers on the desktop-search capability included in Vista. Desktop search, which is separate from Internet search, allows users to scan their own information, such as data on their hard drive. As people store more information, such as e-mails, on their computers, the desktop search feature has become important for keeping track of the material.

Google, which submitted a 50-page document detailing its concerns, has told federal and state officials who monitor the consent decree that Vista's design makes it difficult for users who want to run Google's desktop search instead.

"Microsoft's current approach with Vista desktop search violates the consent decree and limits consumer choice," Google spokesman Ricardo Reyes said in a statement. He said that there is no visible way for users to choose an alternate search provider and that it is difficult to turn off Microsoft's version. Even when users attempt to use its desktop search feature, Google said its version runs slowly because the computer tries to run Microsoft's search at the same time.

Microsoft lawyers dismissed the accusations, saying the desktop search feature is not included in the class of software governed by the consent decree. Brad Smith, Microsoft's general counsel, said that the company held two years of discussions with federal and state officials before Vista's release about the new features and that no one objected to desktop search.

"If there's some reasonable way to address these issues, we're prepared to roll up our sleeves to do so," Smith said. Any problems with slow service are technical issues on Google's end, not Microsoft's, the company said.

Blumenthal said state officials could aggressively pursue enforcement of the consent decree even if federal justice officials do not.

His remarks come at a time of dissatisfaction among some state officials over the Justice Department's handling of the Google complaint. Specifically, some state officials were taken aback by a department memo sent to state attorneys general across the country trying to dissuade them from taking actions against Microsoft, according to people familiar with the memo.

The memo was written by Thomas Barnett, an assistant U.S. attorney general, who had previously been an antitrust lawyer at a law firm representing Microsoft. Justice Department spokeswoman Gina Talamona declined to discuss the complaint.

In the 1990s, the Clinton administration filed suit against Microsoft in a bid to split up the company. A federal court agreed that the company had used its monopoly position in providing computer operating systems to unfairly crush competitors and ordered the breakup. But an appeals court reversed this decision, salvaging Microsoft even as the judges concluded it had repeatedly abused its power.

The Google accusations, first reported by the New York Times, came to Microsoft's attention just after it released Vista late last year, as the consent decree nears the end of its five-year life. Most of Microsoft's activities will no longer be subject to court oversight after this fall, with the exception of continuing discussions between Microsoft and regulators over documentation for a limited segment of its software.

Since the landmark antitrust suit that began in 1998, Internet technology has revolutionized the marketplace. Microsoft finds itself struggling to keep up with the Google, which dominates online advertising. In a reversal of roles, Microsoft filed a complaint this spring with federal officials alleging that Google's proposed $3.1 billion acquisition of DoubleClick, a major online advertising company, raises antirust concerns. The Federal Trade Commission is investigating.
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