Are Microsoft's Limitations On Netbooks Running XP Antitrust Violations?

from the not-really... dept

Michael Scott points us to someone asking how come the limitations that Microsoft puts on computer vendors who are selling netbooks with XP installed don’t constitute an antitrust violation. I’m sure others may differ, but I can’t quite see where the antitrust violation would be here. First, there are alternatives. Linux-based netbooks are still decently popular, so if Microsoft’s limits were a real problem, then there are other ways to go. Second, I would imagine that someone could buy XP through third parties and install it on any machine they want. It’s just that if they want to get a wholesale deal directly from Microsoft, the company puts certain limitations on it. So I don’t see it as an antitrust issue.

That said… I have to admit that I don’t understand why Microsoft puts these limitations on netbooks that run XP. My guess is that it’s because they really, really, really want to move people off of XP and onto Vista (or Windows 7 eventually), and they’re afraid that if they let more powerful netbooks run XP, that they’ll start to become full laptop replacements — and Microsoft’s grand strategy of moving customers to the latest and greatest will stall out. However, that seems hard to support. It makes little sense to try to limit customers — especially those who really want to buy your product. If Microsoft XP makes a computer more valuable to someone, why limit that choice?

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Comments on “Are Microsoft's Limitations On Netbooks Running XP Antitrust Violations?”

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40 Comments
Tgeigs says:

I work for a VAR. The idea is very simple: sell that damnable software assurance with the OS. SA lasts three years, MS comes out w/new OS’s every 4-6. Then it becomes easier to just renew the SA rather than deviate from Microsoft in any way, shape, or form.

The problem is that you have to be on Vista right now to buy SA to up to Win7. So they are making it VERY difficult for anyone that wants to use XP.

The only manuf. so far that has had the balls to tell MS to go eff itself has been HP.

Anonymous Coward says:

If M$ cant make a good OS, they should just quit.

Now that you can not purchase XP licenses thru consumer channels, does anyone know if OEM licenses can be transferred to other equipment in situations where a laptop breaks or desktop catches on fire?

Seems real dumb way of running a business- forced upgrades (via market constraints) to bloatware operating systems. I love the idea that it takes 35 seconds to launch Outlook every morning, and 5-7 minutes just to boot up.

Ubuntu and OSX keeps looking better.

Chronno S. Trigger says:

Re: If M$ cant make a good OS, they should just quit.

“oes anyone know if OEM licenses can be transferred to other equipment in situations where a laptop breaks or desktop catches on fire?”

I believe it can just as long as the original undamaged OEM sticker is transferred along with it, and the originating PC no longer has the Windows install on it (duh). Pain in the ass, ain’t it?

Now here’s a stupid question, if this is an antitrust violation how is the iPhone store not? You can’t get an iPhone app any other way and the availability is completely up to Apples whim.

Anonymous Coward says:

Re: Re: If M$ cant make a good OS, they should just quit.

Now here’s a stupid question, if this is an antitrust violation how is the iPhone store not? You can’t get an iPhone app any other way and the availability is completely up to Apples whim.

I suppose Chrono, when you get a mac and start coding using the *FREE!* XCode and *FREE!* iPhone SDKs, (In comparison to the not so-free Crappy, err, Visual Studio) You can start whining.

Chronno S. Trigger says:

Re: Re: Re: If M$ cant make a good OS, they should just quit.

But I don’t have to learn how to code just to use a program on Windows. Why should I have to learn to code just to use an iPhone? Why do I have to learn how to use a Mac? You don’t have to learn anything new to use the Palm OS (or windows mobile).

The Visual Studio kit has a price but you can still program in .Net and compile it for free. The compiler comes with the free .Net install.

And it’s two N’s in Chronno.

Anonymous Berthaaa says:

Re: Re: Re:2 If M$ cant make a good OS, they should just quit.

But I don’t have to learn how to code just to use a program on Windows. Why should I have to learn to code just to use an iPhone? Why do I have to learn how to use a Mac? You don’t have to learn anything new to use the Palm OS (or windows mobile).

Sure! It’s called C! More Precisely, Objective C.

The compiler comes with the free .Net install.

Yep, but how much is the IDE?

And it’s two N’s in Chronno.

And you can call me Anonymous Berthaaa, which has three A at the end, also when you speak my name aloud, accentuate the second syllable, and you’ve got it right!

Anonymous Coward says:

Re: Re: Re:2 If M$ cant make a good OS, they should just quit.

I do the same thing when I boot up Visual Studio! Sometimes it makes me douse the lappy in 87 octane gas (lower flash point) and it somehow it catches fire. I don’t know how that happened! But out of it all, I have an XP license I want to run in a virtual machine on my mac (which I consider to be a netbook next to my 3 other macs) for all the mundane applications I need like PPT emails that get forwarded to me every so often.

The COA is a little charred but still readable. Is this okay?

How did Steve Jobs put it? “It’s like giving a glass of ice water to somebody in hell”? Yes, I am pretty sure that’s it.

Jack Sombra says:

Re: Re: If M$ cant make a good OS, they should just quit.

First question here seems to be, do MS dominate the market? (requirement for anti trust to come into effect), to answer that we would first have to define “market”

a) Market is all Personal computers, then yes it is clear violation of anti trust laws as MS dominate the market

b) Market is netbooks only, then no, MS don’t dominate so antitrust would not come into play

Now if you picked a) the next problem is, what competition are MS hurting by their actions…err themselves by pritting much locking themselves out of the low to mid price range netbooks and leaving it to everyone else

Now they are hardly likely to make a complaint against themselves are they?

“Now here’s a stupid question, if this is an antitrust violation how is the iPhone store not? You can’t get an iPhone app any other way and the availability is completely up to Apples whim.”
Because antitrust laws/regs applys to company dominating a market, Iphone does not dominate the mobile phone market, it’s even questionable if it dominates the “multimedia smartphone” sub-category due to the blackberry

ps: Mike, for anti trust laws to come into effect it just requires for a particular player to “dominate”, not for there to be a lack of alternatives

Anonymous Coward says:

Re: If M$ cant make a good OS, they should just quit.

“Now that you can not purchase XP licenses thru consumer channels, does anyone know if OEM licenses can be transferred to other equipment in situations where a laptop breaks or desktop catches on fire?”

The way we’ve always been taught as Microsoft partners is basically if the motherboard fails and you are reusing the case, then yes, you may reuse the OEM license. You are not allowed to remove it from the place it is affixed to. Basically if you don’t change the case, you’re fine.

Rekrul says:

Re: If M$ cant make a good OS, they should just quit.

Seems real dumb way of running a business- forced upgrades (via market constraints) to bloatware operating systems.

With XP, they only make sales to new customers. With Vista, they figured that they’d sell to both new and existing users, who would have to upgrade to maintain compatibility with new software.

I love the idea that it takes 35 seconds to launch Outlook every morning, and 5-7 minutes just to boot up.

I cringe every time I go over someone else’s house and their system needs to rebooted because I know I’ll be waiting a good 3-7 minutes. One person has Window Washer set to run at shutdown and that takes at least 2-3 minutes. I recently brought home a Compaq system that someone had put out for trash pickup. It boots up to the logon screen (which is as far as I’ve gotten so far), but the HD chatters for at least 10 minutes!

My trusty Win98SE system boots in less than a minute.

Anonymous Coward says:

the limits aren’t really stopping people either. with earlier netbooks, it was a pain to upgrade, but with newer onrs, the manufacturers have made it easier and easier to swap out network cards, ram and hard drives. if you check the comments section on most online vendors, many people say the first thing they do, even before turning their new netbook on, is upgrade the ram.

Walter says:

Re: Actually it's the opposite...

I had bought a Dell Mini 9 for my wife a year ago and immediately boosted the RAM from 512M to 2G, and upgraded the SSD from 4G to 32G. The upgrade was very easy as they had a one screw door that gave you access to both, nice design. It was a very nice little machine for what she used it for.

Unfortunately it was recently stolen, so I decided to take a look at Mini 10 which Dell wants to replace the Mini 9. As I’m researching it, I find that there is no door for upgrading in this model and in fact the RAM has been soldered onto the board so it can’t be upgraded beyond 1G.

I spoke with a Dell salesperson asking why they did this, they said they had to because Microsoft had informed them they were in violation of their liscensing agreement by having the netbooks upgradable. I mentioned that I wasn’t looking to by Windows, I wanted the Ubuntu version with 2G RAM and she said there was nothing they could do for me.

The fact that microsoft can dictate the specs I can buy for a machine that’s being sold with Linux pre-installed to me sounds like an abuse of monopoly power… but I’m am not a lawyer.

Yohann says:

Shoving MS right down your throat

I recently bought a laptop that came with Vista. I didn’t want to pay for it as I was going to put FreeBSD on it anyway. I asked the guy at BestBuy if I could just have the hardware (no software, no games, etc. etc). I couldn’t do it. Not only that, I *had* to pay for Vista (which I didn’t want). I contacted HP to get a laptop without Vista on it, and they told me 1) You can’t have it, 2) You can’t *not* pay for Vista, and 3) You will never find the laptop without Vista anywhere unless I buy the laptop on Ebay used.

How’s that for ‘monopoly’?

hegemon13 says:

Re: Shoving MS right down your throat

HP lied to you. Lenovo sells notebooks with Linux. Dell sells notebooks with Linux. “Whitebox” system vendors sell laptops built by ASUS, Acer, and other manufacturers with no OS. Microsoft does not have a monopoly, per se, just market domination. There are other alternatives, but you have to look pretty hard.

If HP refuses to sell a laptop without Vista, then I know what I would do in your situation: look for another company to buy from. There are plenty of quality laptops out there. No reason to buy from a company who does not build a product to suit your needs.

Anonymous Coward says:

Re: Re: Shoving MS right down your throat

Where can this magical XP Downgrade be acquired Tgeigs?

Tired of Vista, I called HP last week to ask if I could buy a license of XP. They said it was only available if I was a corporate customer. So off to Google I went. Several Google searches later indicated it’s only available through eBay, which seems a little dodgy.

Anonymous Coward says:

Re: Re: Re: Shoving MS right down your throat

To downgrade I believe you just need to install XP with the XP Pro Disk

Also regarding why it’s difficult to get laptops without Vista on it. It’s related to do with how the licensing agreements for large OEM’s works. Microsoft gives them licenses to Vista for a very cheap price, however in exchange they can not sell computers without an operating system.

The exception to this is Servers. There are some large clients that do not deal directly with Microsoft who with special things can be exempt from this rule, but there aren’t many. The supplier we dealt with had two of those clients.

Selling the laptops with Linux I imagine that some suppliers are getting by the rule by installing linux on it, rather then Microsoft, as you’ll see that they are being sold with an operating system just not a Microsoft operating system.

Tgeigs says:

Re: Re: Re:2 Shoving MS right down your throat

Correct, the one thing MS has done right is to make sure all/most of their licensing is backwards compatible, only the media differs. So your Win7 license key will work with Win7, Vista, XP, etc., etc.

My understanding is that media is no longer being sold for XP, so you’re only option is…dum dum duuuuuuum…file sharing sites.

Tgeigs says:

Re: Re: Re: Shoving MS right down your throat

Well, you have to buy a business-class notebook, but a few P#’s that you can throw into cdw.com, newegg.com, buytech.com, etc:

KS011UT#ABA
KR978UT#ABA
KS017UT#ABA

There are plenty more. All come w/Vista preloaded and a free XP Downgrade kit. The licenses are backwards compatible, of course.

David T says:

Job security, maybe?

“If Microsoft XP makes a computer more valuable to someone, why limit that choice?”

Because then someone has to explain to Ballmer why people want to use a two-generation old operating system when Microsoft spent 8 years and several hundred million dollars making something “better.”

I don’t think “because XP works really well, and we haven’t added enough value to make people switch” is an acceptable answer.

bigpicture says:

Windows XP

That is correct, at some point MS ends up not competing with Linux and OSX but competing against themselves. This netbook market is such a scenario, because MS is cannibalizing its own sale of high margin products, by selling low margin copies of XP. I believe at around $7.00 a copy to the OEMs.

Lawrence D'Oliveiro says:

More Like "Antistupidity Violations"

You think that’s fun? How about the fact that, with the upcoming Windows 7, the version Microsoft is offering for netbooks is called “Starter Edition”, which will limit the user to running 3 applications at once.

This whole netbook thing has got Microsoft spooked, and it’s desperately scrambling for ways to shore up its crumbling profit margins. Trouble is, the more of these sorts of tactics it resorts to, the more attractive the Linux option becomes.

Gene Cavanaugh (profile) says:

Limitations on XP

Interesting thing is that netbooks with linux and XP are nearly the same cost (trivial difference) but the hardware is very different – because Windows is so bloated, XP machines have a lot more memory and other support in the hardware, so I buy netbooks with XP, then load linux (remember, Ubuntu is free, and likely the best linux), because it is cheaper than buying a linux machine (which has a limited linux capability, anyway) and then upgrading the hardware.
I don’t use the XP, though I may let some of my older friends (who are violently opposed to learning about OSes) use XP, so long as they use Firefox and limit the sites they visit.

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