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March 25, 2004

Want Office with that?

Walter Mossberg's Mailbox question-and-answer column in the Wall Street Journal today is particularly interesting when considered in the context of the European Commission's ruling yesterday, challenging on antitrust grounds Microsoft's practice of bundling extra products with Windows. Here's the question one reader asked Mossberg:

I've been looking to buy a new Windows notebook computer for home. But none of them seem to come with Microsoft Office. Is that unusual? Does it suggest that I couldn't work on Word documents or Excel spreadsheets on these computers?

As Mossberg explains in his response, Office isn't bundled with Windows. But the reader assumed it was. Which raises a couple interesting questions: Is that because computer users want their operating system to come with as many extras as possible? Or is it because Microsoft's allegedly anticompetitive bundling practices have conditioned consumers to expect Windows to come with a bunch of additional programs? I'm not sure of the answer.

On a related note, be sure to check out P-I columnist Bill Virgin's piece today exploring the consumer angle of the European Commission's ruling. Also see this story by the AP's Allison Linn, which starts by recounting Microsoft CEO Steve Ballmer's famous assertion that Microsoft should be allowed to bundle a ham sandwich with Windows if it wants to.

Posted by Todd Bishop at March 25, 2004 09:48 AM
Comments

It is more like the consumer doesn't know the difference between the OS and the applications. So hence, they expect both to be on new computers. I have students ask me all the time, "Do I have to buy Office? Isn't it on my computer because I have Windows?"
Vickie

Posted by: Vickie at March 25, 2004 11:00 AM

Operating systems - and not just Microsoft's - have ALWAYS come bundled with applications. When does that bundling become excessive? When is it too much? That's a line in the sand that the courts are trying to draw now.

The argument is that a monopoly can't have as many bundled applications as its competitors.

Posted by: Lincoln at March 25, 2004 11:05 AM

I'm glad that MS-Office is no longer included automatically (with the priced raised to account for it). I recently bought a new HP notebook that did not include MS-Office and I just went to www.OpenOffice.org and downloaded a FREE open-source software suite called OpenOffice.org that is basically a clone of MS-Office. It supports reading and writing MS-Word .DOC files, MS-Excel Spreadsheets, and MS-PowerPoint .PPT files. Again... 100% free. Take that, Microsoft!

Posted by: Loren Scott at March 25, 2004 11:08 AM

Windows comes with Paint, Notepad, a Disk Defragmenter, Scandisk Utitily, Internet Explorer, Wordpad, Windows Movie Maker, etc., etc. I'll assume, by the time Sun et. al. get through with them (via whatever government agencies in whatever countries they can junket and bribe to join the attack squad), Windows will come with nothing. Great. The consumer loses again. As long as Oracle is making tons of money, it's all good, right?

Posted by: Bob Dobolina at March 25, 2004 11:13 AM

Watch out loren scott, a girl in one of my classes thought she could use openoffice to make a powerpoint presentation, and she brought it in to class and had a minor disaster when the powerpoint viewer couldnt handle it because the file was written out by openoffice incorrectly in some minor way

Posted by: zeromus at March 25, 2004 11:13 AM

Although it would not explain this person's exact question since they suggest they are buying for home use, we need to also remember the effect of the mysterious "500-employee limit." See http://archive.infoworld.com/articles/op/xml/01/10/29/011029opfoster.xml

This would explain why you cannot even BUY OEM Office bundled with a system in some cases.

Posted by: Candy at March 25, 2004 11:14 AM

Wordpad is bundled with Microsoft Windows. It can read Word documents. Microsoft Works is usually bundled with big name computer brands like Dell. Microsoft Word is bundled with Works. It's not a part of the operating system, but to most consumers, it might as well be.

Posted by: Michael at March 25, 2004 11:19 AM

It's is insane that you can develop a product that literally changes the way we work and live our lives - and then become a target because you don't want to share the "recipe".

The "cloned" programs only mimic what Windows already offers -taking their technology and logic and offering a poor cousin instead.

Microsoft deserves to retain the right to develop whatever they want, in whatever manner they choose, and bundle however makes sense to their customers.
If the rest of the companies don't like it - DEVELOP SOMETHING BETTER.

This sense of entitlement slays me - sour grapes if you ask me.

Posted by: Hogan at March 25, 2004 11:19 AM

There is no "allegedly" anticompetitive behavior here. Its a fact. They have been convicted not once, twice, but numerous times by both governements and in class action lawsuits. The problem with what the reader was asking in this article is that MS products are so co-mingled, that this individual doesn't even realize there are other alternantives. It's sad, but this person is probably representative of 50% of all computer users out there.

Posted by: hornsmoker at March 25, 2004 11:20 AM

This sounds reminiscent of the browser war days, when your computer either came with IE or Netscape. Consumer education is key for the general public to understand the distinction between the OS and Applications that come loaded. More than three-quarters of the bundled software that comes loaded on a new Windows PC is pretty useless.

Buy a Mac. You'll have less problems and an OS that works.
-R

Posted by: Rob at March 25, 2004 11:25 AM

Hogan, you do realize that Microsoft did NOT invent the 'life-changing' products you mention. They BOUGHT or CLONED them from other companies and figured out ways to lock people in to using them. Ever try to open a Word document in Notepad.....and see gibberish? That is because they do not want you to open Word files with a progam that they do not approve of.

Learn your history before you get self-righteous.

Posted by: s.m. at March 25, 2004 11:27 AM

Hogan,
The rest of the companies have been developing something better. Then if Microsoft has a competing product they make sure that the better one doesn't run as well on or with Windows. Or costs more. Or sometimes they buy it.

The problem is MS is in the business of providing the playing field, (the OS, Windows) and of playing the game (selling application software and servers that MUST work with that OS). They keep changing the playing field to make sure they always win the game. They have been doing this for years. (Old MS slogan: Dos isn't done until Lotus won't run).

Too bad the courts got chicken here in the US and didn't break MS up into two companies, one that makes the OS and one that makes the Apps.

Posted by: Robert at March 25, 2004 11:29 AM

Microsoft bundle software with the OS if they want to destroy competition in that market sector and capture the market for themselves.

Loss leader stratergy.

They did it with IE, they're trying to do it now with Media Player.

I think they *did* do it with Office when they had a competitor (Corel and LotusSuite for instance).

They now own the 'office productivity suite' market, so they don't need to bundle Office. They can charge $500 after market :)

Posted by: Rik Sagar at March 25, 2004 11:29 AM

Hi,

In case anyone was wondering, Congress did a study way back in the 40's and determined that monopolies cannot exist without government intervention (See "The Road to Serfdoom," F.A. Hayek). Since Congress figured this out 60 years ago, they have also figured out that monopoly companies tend to make higher campaign contributions.

Just remember that Microsoft is not interested in open standards. if they were, that girl's PowerPoint presentation would have worked just fine.

So look at it like this: every major advance in human civilization came about from OPEN STANDARDS. The alphabet, electricity, TCP/IP, SMTP and the wheel come to mind. I'm sure MS would love to get royalties for every letter used.

Having open sourced operating systems and office software that work on compatible standards would make sense. This would foster competition and create greater choices for all.

So if you think MS is being attacked, consider the possibility that MS is not interested in competition. They want to wipe competition out completely. Then they won't have to compete. But they can't buy open source under the GPL.

Posted by: Scott Dunn at March 25, 2004 11:35 AM

As a mac user I do not understand the problem of bundling software.
The problem is that Microsoft has a history of bundling applications and forcing vendors NOT to offer other products. They also have not allowed developers to create applications that can compete with what Microsoft makes by limiting access to basic operation system resources. This is what is bad for the consumer and what must be changed not the actual bundling of software.
Fortunately there are better products out there made by Apple. Unfortunately that is one of the few options. And again fortunately the options are increasing with open source, etc.

BTW, did you hear that if you played a Windows install CD backward, you can hear satanic chants and verses. Worse yet, if you play the CD regularly, you install Windows.

Posted by: Tim at March 25, 2004 11:36 AM

"They now own the 'office productivity suite' market, so they don't need to bundle Office. They can charge $500 after market"

Very true in the business world and this is a perfect example of how killing the competition hurts consumers. Lotus Smart Suite is near death and on life support and Word Perfect Office is out of the OR and in recovery - thanks to some OEM's who have finally started to see the light. The problem isn't so much Office as it is the percieved standard of file formats - .doc .xls .ppt , etc.

Posted by: hornsmoker at March 25, 2004 11:45 AM

I wish these government agencies would PLEASE DO A REALITY CHECK! If Microsoft is not allowed to bundle applications if a competitor objects, then what’s next? Will your next car not be allowed by the government to have cup holders? Will the next home you buy not be allowed by the government to have upgraded siding or windows offered by the original contractor? Will your next computer purchase not be allowed by the government to come with a mouse or a hard drive?

You best be very careful when you start letting your government design the features that will or will not be included in the products you buy. You might not like the outcome.

May god help us all.

Posted by: John Borders at March 25, 2004 11:50 AM

I am sorry but Mossberg seems to ask the wrong and the stupid question. The person asking the question is asking it simply because some computer sellers do bundle office applications, like Lotus, Office, Corel Office etc... They do that regularly and that's what prompts the customer to expect that. I assume Mossberg brought the issue simply to be sensational and confuse people. But it is actually very simple, if your friends buy a computer with Office, you expect to find one with Office.

Posted by: Tim at March 25, 2004 01:44 PM

Yes user's expect to have MS Office installed as it was on the last 3 upgrades of their computers over the years.

At the same time, user's also are confused about the version of Windows in relationship to the version of office. i.e. as a tech support professional, users would call and when we asked them what version of Windows they had, they would state the version of Microsoft Office. i.e. Windows 97 which doesn't exist.

The confusion is understandable considering the many name changes on Microsoft products. For example, it used to just be Word and a version number, then it became Microsoft Word, then years, and now XP and year 2002/2003, etc.

It is my belief that the Microsoft branding has been completely intentional to blur the lines of products together and to make Windows and other Microsoft products appear as one product. Another product that has confused a great many users is MS SQL which many users refer to as SQL Server. SQL is a generic database query language originally developed by IBM. This confuses users when they hear about such products as SQL Anywhere which is not the same thing as SQL Server. Or in the past when they heard Word vs. Word Perfect.

Most users are completely unaware of alternatives to Microsoft. When they buy a computer, it's a Microsoft computer. The only real competition for Microsoft is Apple or Linux. Most people don't know what Linux is and Apple is not considered to be a valid business computer and is thought of as a toy even though in many ways modern Apple systems are far superior to PC's with Windows XP. In fact, it will be a few upgrades past Longhorn before Microsoft catches up to Mac OS X 10.3.3.

There's a reason Virginia Tech chose to buy 1,100 Apple G5 Powermac's for their super computer cluster; they outperformed dual xeon Intel based systems in price and speed. Virginia Tech's super computer made it to #2 in the USA.

I don't know of any Microsoft super computer clusters. Any running Intel or AMD processors will be running Linux or BSD instead of Windows.

Posted by: John Doe at March 25, 2004 01:45 PM

I worry more about the effect of a monoculture in the computer world. Too much reliance on a single operating system makes us all more vulnerable to hackers and cyber-terrorists. A stronger presence by competing systems (Mac, Linux, etc.) would make it harder for a lone crank to bring the cyber world to its knees.
Whenever a new virus terrorizes the Windows world I'm glad I do most of my computing on a Mac.

Posted by: Sean at March 25, 2004 02:06 PM

Have you tried to buy a new laptop without XP recently? I can't even get one with Win2000 and shops just look blankly when I say I want one with Linux.

So if I want Win2000, I have to get the bundled XP, reformat the hard disk, pay hundreds of dollars for the OS I do want, then spend a considerable time installing it (and uninstalling the bits I don't want).

MS has since launching Windows bundled just enough to make it hardly worth looking for alternatives. And when a competitor makes a better mouse trap, they simply wrap up an MS branded equivalent - which may or may not work as well, that's not the point - given away free with the OS.

It's not the MediaPlayer that's the issue - it's the production software. The money isn't made off plug ins - the installed base of plug ins drives the market for programs that produce the image or other files that the plug ins run. Bigger installed base = more incentive for producers to use your production software as against the competition.

Companies like Macromedia can expect a Flash equivalent to come into the MS stable - and when it does, the plug in will come with the next version of the OS. Historically, MS has restricted access to interchange code for competing products and if they did release a Flash equivalent, then Macromedia may not get the interchange codes for the new OS/browser until right before or even some time after the new release. The EU order, which is a lot more complex than most commentators are noting, contains terms to prevent that course of conduct.

And Hogan : the Office Suite was not invented by MS. It was invented by Lotus and perfected by Ashton Tate both operating under DOS, the latter actually working in windows (small w) before MS released the Windows OS. The only things of any importance missing were a) easy set up of peripherals and b) cut and paste. Neither product was migrated to Windows - a real shame as the Lotus product was especially strong for calculations (123 was its core) and Ashton Tate's Framework (killed by Borland) contained superb database & WP elements.

Posted by: A world without MS? at March 26, 2004 12:01 AM

"When does that bundling become excessive?"

When it goes beyond mere "bundling" to become _tying_ that eliminates customer choice and supresses competition.

WMP, the Exploder, Messenger, et al are not "bundled with" Windoze. You don't have the options of not installing, or of removing, them. The courtw have been drawing lines between when that's legal and when it's not for many years. The line is somewhat fuzzy, but MS is unistakably, and quite deliberately, well beyond it.

Posted by: Ran Talbott at March 26, 2004 03:39 AM

Another interesting software package that offers a suite of programs similar to MS Office is Software602. The link for them is http://www.software602.com

The problems with the MS Excel spreadsheet and all its clones is that none of them have addressed the issue of spreadsheet risks. Not one of the cloners has tried to come up with a product that leads the way in this area. The all following behind in the foot steps of the Redmond gaint.

Check out:

http://blogs.ittoolbox.com/bi/spreadsheet/archives/001224.asp

at "The Fragile Last Mile of BI: Spreadsheet Risk & Fraud Analysis" blog

Posted by: Donavan McDonough at August 7, 2004 11:11 PM
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