Microsoft Threatens To Withdraw Windows in S.Korea

RocketJeff writes "South Korea's Fair Trade Commission (FTC) has been investigating Microsoft since 2001 for violations of South Korea's antitrust rules. According to a Reuters article, part of a recent Microsoft regulatory filing states 'it might be necessary to withdraw Windows from the Korean market or delay offering new versions in Korea.' Basically, Microsoft is threatening to take their marbles and go home if they don't get the ruling they want."

Comments

Their software

[MrDoh1]

It's their software, shouldn't they be able to sell it or not sell it where they wish?

Re:Their software

[CosmeticLobotamy]

It's their software, shouldn't they be able to sell it or not sell it where they wish?

They should be allowed. That doesn't mean they're not jerks if they do.

Re:Their software

[k98sven]

It's their software, shouldn't they be able to sell it or not sell it where they wish?

Nobody said otherwise. (I now take a step back to avoid being hit by the falling straw-man)

It's very simple. Microsoft doesn't have to sell their software in Korea if they don't want to. Although they'd probably not be able to stop it, since it could be imported via a third country.

But if Microsoft does want to sell their product in Korea, they have to follow the rules and laws passed by the Korean government. It's as simple as that. Bitching about (in your mind) unfair laws might be okay if South Korea was a dictatorship, but it's not. South Korea is a democracy. Those laws have the support of their people.

Or are you simply some imperialist who believe you know what's better for them than they do?

Besides which, Microsoft isn't going to get out of Korea. They can't afford to. Not because of the money, but because it would create the incentive for them to switch. There are nearly 50 million people in South Korea. Whatever platform they moved to (Linux, Mac), it would be a huge boost for that platform, which would mean a much larger strategic loss for Microsoft than it would in terms of Windows licenses.

Microsoft needs to sustain it's monopoly to survive. Why do you think they're fighting the OpenDocument format so hard? They need to stop other platforms from becoming viable alternatives. And a large modern nation like Korea certainly has the resources to do so.

Re:Their software

[Daniel_Staal]

Sure they can.

The fact that Microsoft is thinking about it is news, as well as why. Sure they have the right, but it seems the reason to do it is to threaten a country into doing what they want. (By leaving them outside of a technological loop, where everyone else is likely to have a product they don't.) This is interesting because: A company has the power to inconvience a country; Microsoft is acting like a bully; Microsoft obviously isn't seeing all the long-term implications of this.

If Microsoft succedes, they have proven a multi-national company can be above a particular country's law, and we may be on the way to an overtly corporate-run globe. If it is not a bluff and S. Korea calls it, OSS in all it various forms will get a boost, and we will get to see exactly how much power Microsoft has. If Microsoft backs down, they look like a scared bully and lose prestige. (Especally amoung governments.)

This is a high-stakes move from Microsoft. It will be interesing to watch. Most likely is some compromise position, which still shows a lot of power in Microsoft's hands.

Funny, that

[JudicatorX]

the headline below this is "Why do people switch to Linux?"

Nothing to see here..

[Pudusplat]

"If the KFTC enters an order requiring Microsoft to remove code or redesign Windows uniquely for the Korean market, it might be necessary to withdraw Windows from the Korean market or delay offering new versions in Korea,"

So, if I'm reading it right, Microsoft is saying that they will either not release a "special" version of windows for S. Korea, or that releases will be delayed (presumably to create the modifications required by their Anti-Trust regulations).

This seems perfectly reasonable. They're not even saying they will necessarily pull windows from the market, it might just take them longer to develop the "MS Vista - S. Korea Version" than it would to release the standard. Nothing to see here... more Microsoft non-news.

Plus, if S. Korea is saying "play nice" and they say "no" outright, this is still well within their rights, there is no mandate that they must release software for the masses (In fact, SlashThink directly opposes this). More power to S. Korea if they think they can actually pull that off...

Re:Good strategy

[El Cubano]

Right...that should convince the South Korean government (and the rest of the world) that they're not an abusive monopoly.

I don't care what the rest of the world thinks. I would just like to see them do the same throughout the rest of the world. Start threatening to take Windows out of the various world markets and see the wonders it does for OSS alternatives. At the very least people will begin to prepare migration plans and so on.

Re:Good strategy

[Tester]

Gaming is fairly big in SK also, somehow I think 'it runs on WINE' isn't going to fly.

But it runs on the Playstation probably is.. Its also a huge market for games, so this might make people write/port their games to non-Microsoft operation systems..

A dash of reality, here

[Control Group]

Oh, please.

MS isn't going to pull out of South Korea. Everyone involved already knows that. The statement is just part of the usual grandstanding that always goes on with this sort of thing. They won't pull out because it's too large a market to just write off, and they don't want another country deciding to go with a competitor nationwide.

Re:Good strategy

[MoonFog]

Or it would spark more piracy as people desperate to play Counterstrike and Starcraft download Windows instead of buying it in the stores.

Re:Good strategy

[QuietLagoon]

Exactly. All this would be is a short-term pain for South Korea. In the long-term, however, it would convince companies in South Korea and elsewhere not to place strategic reliance upon a proprietary operating system that can be pulled off the market on a whim.

I have to wonder, is Microsoft's future sales of Windows starting to look so bleak that Microsoft needs to play poker with their customers? I know that yesterday's quarterly report was not the greatest, but I didn't think it was bad enough to start warranting this type of chair-throwing behavior with South Korea.

On a side note, since this news broke, if any CIO manager who is dependent upon Windows is not starting to look for strategic alternatives, that IT mangaer is not doing his or her job.

The way I see it.....

[8127972]

There are three possible explanations:

1. Microsoft doesn't make a lot of money in South Korea, so they don't care if they're there or not.

2. This is just a stunt better used by an 8 year old rather than a mult-billion dollar software company.

3. Microsoft is desperate to hold on to its domination of the planet earth. After all, when you control over 90% of the desktops on earth there's nowhere to go but down.

Re:Good strategy

[Klivian]

I wonder what percentage of the south korean economy is made up of those internet cafes. Switching OS's won't really be fun for them (if it comes to that.).

Does not really matter, as it's not like MS can reclaim already existing Windows installs. It may create some annoyances for people planing new deployments or upgrades, but existing install will not be affected in any way. It's like if Ford decided to stop making cars, it would not cause all the Fords currently on the road to stop working.

Re:Nothing to see here

[daVinci1980]

Yeah.. This headline is exactly why the media today pisses me off. Sensationalism at its worst.

From TFA: "If the KFTC enters an order requiring Microsoft to remove code or redesign Windows uniquely for the Korean market, it might be necessary to withdraw Windows from the Korean market or delay offering new versions in Korea," Microsoft said in a U.S. regulatory filing on Thursday. (Emphasis mine)

First off, that was disclosed in a regulatory filing, which was the responsible thing for Microsoft to do. They're warning their investors that should the ruling be against them, they will have to take steps to deal with the ruling which would cost them and their investors money.

Secondly, Microsoft isn't really being unreasonable. Irrespective of whatever reasons they chose to bundle these three pieces of software in the first place, they're bundled together now. There are many issues with decoupling them, not the least of which is the fact that the SDK for WMP and MSN are now included in Windows, and could cause breakage to non-Microsoft applications when removed. But let's assume for a second that not one app in the entire world uses either of these extensions to the standard Windows SDK. There's still the issue that decoupling these pieces of software will be expensive... If only Korea requires their decoupling, it may make more business sense to simply pull their product from South Korea rather than pay the costs associated with it.

Finally, Real Media (also mentioned in TFA) doesn't have a leg to stand on. Their product is inferior to their competitors' products in every way, so they chose to stay in business the old fashioned way: lawsuits.

I'm not pro-Microsoft. But I'm definitely anti-sensationalist media and anti-idiot.

Korean Strategy: All Microsoft IP declared Public

[Confessed Geek]

You can't play hardball with an independent nation..

Tomrrows Headlines:
Korea declares all Microsoft IP, Software and Copywrites to be in the Korean Public Domain. All Microsoft Offices Nationalized and documents seized for "National Security"

Re:You are 100% correct.

[Catbeller]

Nope. Monopolies destroy "free markets". That's what Adam Smith, no less, said. And he was right. If the result of a "free market" is the permanent elimination of a free market, then you've hit a recursive loop and have fallen off the flat earth.

And here's a thing: a nation doesn't maintain free markets to enable companies to do whatever they want. Free markets are maintained for the benefit of the common good, so that prices are kept sane, product can't be embargoes on personal whim, and we the people have a market responsive to our needs, NOT THE COMPANY'S.

Corporations are licensed legal fictions designed to remove personal liability from the exectives of same. They exist for our purposes - the market is not kept free for their benefit, but for ours.

Letting busineses grow into monopolies, unregulated, will just create a new feudalism which will in no way be a free market enabling a free people. The only people "free" in a world without business regulations will be the owners of the businesses.

We regulate monopolies so we can retain free markets. That's not just Adam Smith, it's the law.

Re:Good strategy

[SQL_SAM]

First, South Korea isn't known for piracy any more than any other country.

I did a simple google search (piracy in south Korea) and found the following interesting articles. I may be wrong, but it does look like S. Korea is known for a major amount of piracy And is my opinion that we (United States) are no way as close to the piracy in other countries like South Korea as we tend to fear repercussions and law suits more then other countries do...

http://www.mpaa.org/PiracyFactSheets/PiracyFactShe etSouthKorea.pdf

http://www.variety.com/article/VR1117907504?catego ryid=1009&cs=1

Piracy losses (US$ millions) $27 million
Seizures (all items) 231,514
Piracy level (Video & Optical Disc) 25%

"Piracy has been on the rebound in South Korea since the economic downturn in 2001 and 2002. Historically, piracy of high quality, counterfeit videocassettes has been the most prevalent in the market. However, in 2003, there has been a significant increase in the number of DVD imports and optical disc burner operations in South Korea. In addition, duplication facilities of videocassette plants and now burner labs have become larger, more secretive and more sophisticated with technology. This signals a shift from the historical trend where piracy duplication facilities had small and medium capacity.

South Korea's cat-and-mouse with piracy

"With a piracy rate of 40 percent to 50 percent, according to various estimates, South Korea has become one of the hot spots for cracking down on illegal software."

Again I may be wrong but it seems that your statement is unfounded. - Cheers!