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Russia Launches Anti-trust Probe of Microsoft

NewYorkCountryLawyer writes "Russia's state anti-monopoly service said on Thursday it had launched a probe of Microsoft over cutbacks in supplies of its Windows XP operating system in Russia. The agency said it thought Microsoft had violated antimonopoly legislation by cutting delivery of Windows XP operating system to Russia both separately and pre-installed on personal computers, as well as in its pricing policy on the product. It said it would consider the case on July 24, 2009."

51 of 221 comments (clear)

  1. Russia launches... by Anonymous Coward · · Score: 2, Interesting

    When I read the first two words I nearly had a heart attack, since the other launches lately have been NK testing missiles.

    1. Re:Russia launches... by Ethanol-fueled · · Score: 3, Funny

      When I read TFA I nearly had a heart attack, as NYCL posted something which has nothing to do with the media industry!

    2. Re:Russia launches... by NewYorkCountryLawyer · · Score: 4, Funny

      NYCL posted something which has nothing to do with the media

      Huh? Microsoft products are delivered via media just as much as Sony's (for example) are. Even if you were using "media" as a weird synonym for "entertainment" (or "culture") it would seem to be as much applicable to Microsoft as to the companies NYCL usually takes an interest in. In fact even if you meant to say "music industry", Microsoft would be more than tangentially involved.

      Nah. My interest in this one is just a sporting one. Microsoft v. Russia? You gotta love that one.

      --
      Ray Beckerman +5 Insightful
    3. Re:Russia launches... by Anonymous Coward · · Score: 4, Funny

      In the red corner, weighing in at 190 lbs, Prime Minister, former President, and Leningrad's Own Senior Judo Champion Vladimir Vladimirovich Putin!

      In the blue corner, weighing in at 240 lbs, Steve Ballmer, CEO and Chair Thrower, looking radiant in his Polonium-laced wrestling gear!

      Two men enter the ring, only one leaves alive!

  2. In Soviet Russia... by Anonymous Coward · · Score: 5, Funny

    In Soviet Russia, Microsoft probes YOU!

  3. I thought... by Anonymous Coward · · Score: 4, Funny

    ... in Russia, Microsoft would launch the probe! /Slashdot has been lying to me....

  4. ...Profit! by Anonymous Coward · · Score: 2, Insightful

    After so many other countries are getting on the whole anti-monopoly bandwagon, why should Russia be left out of the money?

  5. Did you know? by Anonymous Coward · · Score: 2, Funny

    The Russian state anti-monopoly service is itself a monopoly.

    And you cant bring the Parker Brothers game into Russia for fear it might contact the anti-monopoly service, creating a huge explosion.

  6. What about Gazprom? by an.echte.trilingue · · Score: 4, Funny

    Talk about Goliath versus Goliath. The successful monopolist versus... the slightly less successful monopolist who can rewrite its own legal system. Time to invest in popcorn.

    --
    weirdest thing I ever saw: scientology advertising on slashdot.
    1. Re:What about Gazprom? by BeardedChimp · · Score: 2, Interesting

      It's worse, Gazprom is state controlled and so Russia actually encourages its monopoly by helping to extort foreign companys.

      I can understand the thinking though, the relevant analogy would be if there was a car company with 90% monopoly with the other 10% not being compatible with the petrol. The car company brings out a new more expensive model while refusing to sell the old model and stopping manufacture of old parts. Nobody has a choice since the other cars won't run on their fuel and so the company can keep forcing upgrades.

    2. Re:What about Gazprom? by Patch86 · · Score: 2, Insightful

      No one forces you to stop using 1960s muscle cars. If you owned one, you can continue to own it forever. You can also legally maintain and service it, and it is compatible with still-available fuels.

      Taking away XP is a little different. Whole countries rely on Windows to function. If you pulled the Windows rug out from under Russia (or anyone else) it'd be a train wreck. Without major (MAJOR) hardware upgrades, Vista isn't an option for your average East European lesser-government-agency-office. And refusing to license, support, or open-source (thus allowing self-support) XP when there is no easy alternative is essentially leaving Vista as the only option.

      If you were a national government, and you were being told "Pay billions in licensing and hardware upgrades for no reason OR ELSE" by a monopoly company, you'd be reaching for the anti-trust box too.

    3. Re:What about Gazprom? by caluml · · Score: 3, Informative

      No one forces you to stop using 1960s muscle cars. If you owned one, you can continue to own it forever. You can also legally maintain and service it, and it is compatible with still-available fuels.
      ... snip ...

      Taking away XP is a little different. Whole countries rely on Windows to function.

      How so?

      No one forces you to stop using Windows XP. If you owned XP, you can continue to own XP forever. You can also legally maintain and service it, and it is compatible with still-available software.

    4. Re:What about Gazprom? by Patch86 · · Score: 2, Insightful

      Usability of XP is a lot more than just having it.

      For one, security. Security threats march forever onward, and are kept at bay in the long run by MS patching up the various breaches. When they stop doing that, XP stops being useful to anyone who desires a secure computing environment (eg, national governments).

      For two, new licences. Large organisations are forever gradually replacing hardware, reformatting old hardware, and generally altering their computing setup gradually over time. If MS will no longer license you to install their OS, you'll be forced to replace it with something else (see GP).

      For three, compatibility. If MS is pushing an OS that has fundamental difference in the way it interacts with hardware, drivers and the like will be different. The more pressure MS puts on obsoleting XP, the less likely it is to be compatible with new hardware, software and APIs.

      None of this applies to your car. The only thing your car needs to interact with is fuel (still available 40 years on) and spares (still, you guessed it, available 40 years on). A well maintained 1960s car is exactly as useful now as it was when it was made, capable of all of the exact same things. The same can't be said of an obsoleted OS.

  7. Anti-monopoly? by Andy+Dodd · · Score: 4, Insightful

    While Microsoft obviously engages in a lot of monopolistic practices and I strongly dislike them for this, Russia's reasoning seems rather flawed.

    While yes, it sucks that Windows XP is being EOLed for a lot of people because Vista is worse than XP for many users (IMO anyone with less RAM than the 32-bit addressing limit because if there's anything modern that sucks more than Vista, it's 64-bit XP), products getting EOLed is a fact of life. I can't see any reason why EOLing a product would be monopolistic.

    Hell, if anything, it would be just the opposite - EOLing a popular product in favor of a less popular product is going to drive people towards the competition.

    --
    retrorocket.o not found, launch anyway?
    1. Re:Anti-monopoly? by wjh31 · · Score: 5, Insightful

      because you can only afford to EOL a still very popular product when you are near-monopolistic enough to be able to force people to buy the more expensive alternative.

    2. Re:Anti-monopoly? by Anonymous Coward · · Score: 5, Interesting

      Because the market is asking for XP but MS is in a monopoly position and they can ignore the market request. Your statement of driving people towards the competition is only valid in a competitive market. The OS market is not competitive. In reality, Linux offerings are the only true competitor since hardware and licensing limits prevent someone from buying OSX and installing it on their computer and that makes up what? 1-2%?

      If the market were competitive, MS would be forced (by market forces) to keep selling XP over Vista, or see an exodus of customers. That is not possible here, because there is a monopoly actor.

    3. Re:Anti-monopoly? by tetromino · · Score: 5, Informative

      Because Russia's Federal Anti-monopoly Service (FAS) has broad powers that go far beyond regulating monopolies. For example, FAS are also responsible for regulating advertisements, foreign investments, government purchases, etc.

      IMHO, the Service's name is a bit of a misnomer; it should have been called something like the "Federal Economic Regulatory Service".

    4. Re:Anti-monopoly? by ShadowRangerRIT · · Score: 2, Insightful

      Not necessarily. If they keep selling XP, they have to keep supporting XP. If they had to do that the same for any other OS favored by a substantial number of people, they'd have 90+% of the company on support. Which would mean less new features in the new OSes, and less reason to upgrade, leaving MS with a trail of incrementally upgraded OSes, all of them needing support, and people rarely buying any of them.

      By not supporting every OS since DOS 1.0, MS had the resources to make Windows 7 attractive to some customers, despite the cost of an upgrade. Arguing that monopoly practices are to blame is a joke; there are other OSes, and it is MS's choice to risk driving people to them by EOL-ing XP.

      --
      $_ = "wftedskaebjgdpjgidbsmnjgcdwatb"; tr/a-z/oh, turtleneck Phrase Jar!/; print
  8. Re:That's Pretty Funny... by Ihmhi · · Score: 4, Informative

    Well, Chutzpah is a word derived from hebrew. The best english equivalent is "audacity", and it comes out as this. You can translate it here and hear what it sounds like.

    (Too bad Slashdot will inevitably mess up any attempt at a foreign language. The word comes out like this: "ÑмÐÐоÑÑÑOE")

  9. This actually sounds reasonable. by i+kan+reed · · Score: 3, Insightful

    I always thought bundling useful tools with an operating system(i.e. IE) was a poor example of leveraging a monopoly to corner a market. However, discontinuing support for old products to FORCE new ones on customers, that is leveraging a monopoly in an anti-competitive manner. This is a much more reasonable case to take against Microsoft's more shady practices.

    1. Re:This actually sounds reasonable. by man_of_mr_e · · Score: 4, Interesting

      XP is a 9 year old OS. Even auto makers are only required to support the parts for their cars for 7 years. At what point isn't it an anti-trust violation to want to get rid of an aging product? 15 years? 30?

      There isn't a single Linux vendor that supports a 9 year old version of Linux without paid support, and Apple certainly doesn't support 9 year old versions of MacOS either.

    2. Re:This actually sounds reasonable. by compro01 · · Score: 3, Insightful

      I don't see anyone wanting to require Microsoft to keep supporting it (They're going to support it with security updates until 2014 anyways). I see people wanting Microsoft to be required to keep selling it.

      --
      upon the advice of my lawyer, i have no sig at this time
    3. Re:This actually sounds reasonable. by Elektroschock · · Score: 2, Insightful

      When you buy a product today it should be supported 7yrs onwards

    4. Re:This actually sounds reasonable. by sunderland56 · · Score: 3, Insightful

      Auto makers are required to support their cars for 7 years after the last new one is sold, not from the date of introduction.

      XP was available until 2008 (if I remember correctly), which would mean that if it was a car, it would have to be supported until 2015.

    5. Re:This actually sounds reasonable. by sweatyboatman · · Score: 5, Insightful

      1. software is very different from car parts. a better metaphor would be Coke and New Coke.

      XP may be a 9 year old OS, but to many people it's a better OS than Vista. Vista is New Coke. The Coca-Cola company tried to insist on selling New Coke exclusively, but they alienated their existing customers. They went back to the original formula because New Coke was driving away customers to Pepsi and other competitors.

      If Coke was the only kind of soda, then we'd all be drinking New Coke today. Regardless of whether it was wanted by customers.

      That's what Microsoft did with Vista. Except there's no "Pepsi" competitor to force them to market their more desirable product.

      To answer your question, Microsoft can "get rid" of their aging product when they produce a new product that people want more than XP.

      --
      It breaks my pluginses, my precious!
    6. Re:This actually sounds reasonable. by xenolion · · Score: 2, Insightful

      I see that myself and I don't get why. People liked VHS videos but I don't see people and countries sueing Sony or other makers of them to keep them going when there is newer products out there. All I see these lawsuits and probes are just ways to find something to get money off a huge company and make them look good to some person that doesn't get what it takes to move business along. All companies out there will cut off a product at some point and move on.

    7. Re:This actually sounds reasonable. by Tweenk · · Score: 3, Insightful

      Even auto makers are only required to support the parts for their cars for 7 years.

      If more than 60% of people had the same 9 year old model, they'd have to. Even if they didn't, somebody else would because it would be profitable to sell parts. When it comes to Windows, only Microsoft has the source code and can supply fixes, so it makes sense to force them to support their product, because lots of people are still using it and nobody else can do it.

      --
      Those who would give up liberty to obtain working drivers, deserve neither liberty nor working drivers.
  10. gimmie back my gramophone! by spyrochaete · · Score: 4, Insightful

    So in Russia it's illegal for a company to sell a 10 year old product, even though that product will be 2 versions old this year? If we could make legal demands to sell retired products I'd still be eating Ninja Turtle cereal today.

    1. Re:gimmie back my gramophone! by sweatyboatman · · Score: 4, Insightful

      two versions old? that's a metric? Vista's lifespan was what, a year and a half?

      XP is a good enough operating system. In my (admittedly limited) understanding, demand for XP is actually quite a bit higher than for Vista. (Though this seems to be borne out by things like people paying $100 more for a Vista license so they can downgrade to XP.)

      Replacing a very popular product with a much less popular product is corporate suicide (imagine if Toyota discontinued the Corolla line and replaced it with a Hummer line -- Honda would be very pleased). The only way a company could get away with this is if they are in a monopoly position. And it's reasonable to consider that an abuse of that monopoly power to do so.

      After all, Microsoft's monopoly does not give them the right to foist garbage upon their users year after year.

      My office has XP machines, I know they work with all my software and I the people here are comfortable with that OS. If "Windows 7" (like Vista) doesn't offer sufficient enhancements over XP, why should I be forced to purchase an inferior (for me) product in order to get a new computer?

      --
      It breaks my pluginses, my precious!
    2. Re:gimmie back my gramophone! by je+ne+sais+quoi · · Score: 4, Insightful

      Nobody relied on solely Ninja Turtle cereal to obtain their living. One could argue that XP is a vital component for a lot of businesses and that by artificially restricting it as MS is doing, you are forcing them to incur an unnecessary cost. This is essentially saying that MS is a utility service and their actions are analogous to the phone company forcing all land line users to purchase new land lines just because they are old (and not necessarily in need of replacement). I don't necessarily view this as correct, but MS doesn't have too much sympathy from me because they're ditching an OS that people want to buy and somewhat arbitrarily forcing people to buy a new one that isn't as fast.

      --
      Gentlemen! You can't fight in here, this is the war room!
  11. Re:That's Pretty Funny... by Anonymous Coward · · Score: 3, Funny

    The word comes out like this: "ÑмÐÐоÑÑÑOE"

    It translates it to Swedish?

  12. Waiting for bribes by sznupi · · Score: 4, Informative

    If you're referring to EU fines...they are absolutely insignificant pocket change for EU budget; they wouldn't even make a difference to most of its individual memberstates.

    In this case the amount of money would be similarly insignificant when it comes to contribution to Russian budget. OTOH...there are certianly few individuals who could forget the whole deal for some favours. That's how things work in post-soviet countries.

    In anycase, the claims are bogus, almost everybody runs pirated software in Russia.

    --
    One that hath name thou can not otter
    1. Re:Waiting for bribes by ArhcAngel · · Score: 2, Funny

      "In any case, the claims are bogus, almost everybody on Earth runs pirated software."

      Fixed that for you ;-)

      --
      "A person is smart. People are dumb, panicky dangerous animals and you know it." - K
    2. Re:Waiting for bribes by sznupi · · Score: 3, Insightful

      Hey, with vast majority of EU fines being levied on European companies, can you really blame them for thinking that ALL companies operating in EU, not only local ones, should follow rules?

      --
      One that hath name thou can not otter
  13. Thanks Europe by BasharTeg · · Score: 2, Interesting

    It appears that the European efforts have triggered a new trend whereby EVERY country a multinational corporation operates in that isn't its native country can start engaging in the MoneyGrab(tm) technique. I mean why let all those euros or rubles leave the country? Why not have companies come in, sell products, and then since you can't tax the hell out of them due to the WTO and the ensuing trade wars, instead just trump up some charges over being too succcessful and "tax" them that way.

    Can someone explain to me why this isn't a WTO issue and why these kinds of taxes... I mean fines aren't regulated under the trade agreements?

    And don't tell me how they're just trying to stop the evil monopolies. I'm fine with them fining the shit out of Microsoft for bad behavior as long as they're willing to donate 100% of the proceeds to charity. It's not about the behavior, it's about the money.

    1. Re:Thanks Europe by Elektroschock · · Score: 5, Interesting

      Because antitrust is about enforcement of competition rules as to create a free competitive market. WTO is concerned about barriers to free trade and the promotion of better competition. They basically have he same objective in trade.

      It is false that Microsoft is taxed or that money was a motivation for these policies. At least on the EU side the large fines occured because Microsoft refused to comply with the moderate sanctions and played stupid. It was the first company ever which did not comply with a ruling.

      And don't forget that the US let them off the hook, just because Bush was reelected.

      In fact competition authorities don't get money or staff for the imposition of fines but rather strong lobbying and a lot of work. They would prefer to arrest offenders but criminal sanctions are not at their disposal. Deterrent fines is all they can issue and the way Microsoft communicates demonstrates that they do not show any respect.

    2. Re:Thanks Europe by sznupi · · Score: 2, Informative

      It appears you have no idea what you're talking about.

      So...again:

      a) those money are pocket change to EU budget

      b) EU primarily fines...European companies! Do you suggest "multinationals" should be given some slack?

      --
      One that hath name thou can not otter
  14. Re:they just need to search locally by Capt.DrumkenBum · · Score: 2, Funny

    Please enjoy all the virus, spy-ware, add-ware, Trojans, and key-loggers included at no extra cost.

    --
    If I were God, wouldn't I protect my churches from acts of me?
  15. Russia is cracking down on piracy, Linux spreads. by Reservoir+Penguin · · Score: 5, Interesting

    My mom works at one of the research institutes in Akademgorodok, a major research center near Novosibirsk, she along with hundreds of others have been running pirated windows/office/photoshop/matlab for as long as I can remember. This time it seems the government is serious about the crackdown on illegal software. Each lab director got a direct order to either provide every scientist with lisenses for every piece of software or install linux. Well. they all have been running Ubuntu since yesterday. So far so good.

    --
    US-UK-Israel: The real Axis of Evil
  16. No rule of law in Russia by cryfreedomlove · · Score: 3, Interesting

    If I were MSFT, I'd be worried about the weak rule of law in Russia. It is highly likely that there is pre-determined outcome in the mind of the Russian officials running this case and any 'investigation' will be a show trial leading to that pre-determined outcome.

    I have visited Russia many times. Might makes right. It is a system that breathes on graft and corruption.

  17. You commie! by hellfire · · Score: 2, Funny

    So in Russia it's illegal for a company to sell a 10 year old product, even though that product will be 2 versions old this year? If we could make legal demands to sell retired products I'd still be eating Ninja Turtle cereal [flickr.com] today.

    What, Fruity pebbles isn't good enough for you? What are you, a communist?

    --

    "All great wisdom is contained in .signature files"

  18. Re:How about Ford model T ? by mcgrew · · Score: 2, Interesting

    WTF? That car's older than my dad, and he's in his seventies. And guess what? You can STILL get parts for one! Try getting any parts for Windows 98, that's not even 10 years old. I have older t-shirst than that.

    Now please put the chair down, Steve.

  19. Bad analogy by hellfire · · Score: 4, Insightful

    XP is a 9 year old OS. Even auto makers are only required to support the parts for their cars for 7 years

    In the US and Europe, automobiles are heavily regulated to meet certain standards, and software is not. If a 9 year old car is many times safer, more reliable, more fuel efficient, much better looking, and more easily fixed than the 2 year old car coming from the factory now, and the new car is just a total dog, and if community outrage was so high that people would only want to buy the old car, and this was the only auto maker available to buy cars from then damn straight the community would be in the moral right to demand that company continue to support the old car model until the choice of a car that was as good or better came along.

    Microsoft is a convicted monopolist both in the US and Europe. If there was more competition, and Vista was a dog, people could turn to another company for better service. But they can't. They turn back to Microsoft and demand XP. They are, allegedly, trying to control the supply channel by strangling supplies of XP and hoping this will force demand to Vista, which will make Vista look better as sales go up. They have an image problem with Vista and they are using their monopoly power to try to fix it. If this was a competitive market and Linus and Mac OS had 33% each, We could just switch to one of them and Microsoft would have to compete.

    Once you are a monopoly, 99% of the business book is thrown out the window. Everything comes down to, "when you take an action as a monopolistic company, are you abusing your market dominance and reducing choice for the consumer?" A car maker to tried to do this without monopolistic power would shoot themselves in the foot for cancelling a profitable product line just because they want to sell more of another. The American automakers did just this, by trying to sell more trucks and SUVs when the future trend was towards smaller fuel efficient cars. Now GM and Chrysler are on life support, and Hyundai is making out like a bandit. Competition would have done that to Microsoft to, but there is none, so they have to follow different rules. If they don't follow those rules, any and all governments need to slap their greedy hands.

    --

    "All great wisdom is contained in .signature files"

  20. Re:NYCL? by NewYorkCountryLawyer · · Score: 2, Informative

    We didn't know you had interests other than fighting the RIAA?

    Well as you know my professional life is largely about fighting for the good guys, against the bad guys. This story comes as a welcome relief from my normal activities.

    Microsoft v. Russia?

    This is rich.

    --
    Ray Beckerman +5 Insightful
  21. Re:That's Pretty Funny... by Amazing+Quantum+Man · · Score: 4, Informative

    Yiddish, actually.

    A better equvialent is "nervy gall".

    Chutzpah is when you murder your parents, and then throw yourself on the mercy of the court because you're an orphan.

    --
    Fascism starts when the efficiency of the government becomes more important than the rights of the people.
  22. Re:NYCL? by NewYorkCountryLawyer · · Score: 2, Funny

    We're corrupting him! The poor fellow...

    Absolutely. As soon as I saw the headline -- "Russia Launches Anti-trust Probe of Microsoft" -- the first thing that came into my mind was that this was a perfect story for Slashdot.

    The only thing missing was a subhead: "Software Giant Accused of Cheating Natalie Portman".

    --
    Ray Beckerman +5 Insightful
  23. Re:How about Ford model T ? by starfishsystems · · Score: 2, Insightful

    You make a really good point.

    It's quite easy for a third party to manufacture compatible parts for an automobile. There's a huge and thriving industry based on exactly that premise.

    Not so for proprietary software. Many vendors go to significant lengths, both legally and technically, to prevent this. Microsoft is a good example.

    So when Microsoft says "we will no longer support this product" it's not like there is someone else who can take over that support. It's abuse of a monopoly position that has been deliberately engineered. Not cool.

    --
    Parity: What to do when the weekend comes.
  24. Re:Russia is cracking down on piracy, Linux spread by Reservoir+Penguin · · Score: 3, Insightful

    Amazing how people's attitude towards Free software changes once they learn the true cost of opening pictures with Photoshop and typing memos with MS Office. I do wish people came to Linux voluntarily but after 20 years of unrestrained piracy only threat of heavy fines can make people give up what they have come to believe is rightfully theirs.

    --
    US-UK-Israel: The real Axis of Evil
  25. Re:That's Pretty Funny... by Cyberax · · Score: 3, Informative

    "Chutzpah" is better translated as "naglost'", definitely not "smelost'" ("bravery").

  26. Re:Just plain stupid... by Pentium100 · · Score: 2, Insightful

    Yes, like 64bit OS will stop people from opening that attachment or downloading Antivirus2015 and running it.

    Also, people will code 32bit apps, because they are more compatible (runs on both 32bit ant 64bit systems), while 64bits is only useful if your app uses a lot of RAM or CPU. There is no point for a 64bit CD/DVD recording software, media player and browser. 64bits can be useful for games, photoshop and video editing software.

    If I understand correctly, to make a 32bit app from 64bit (or vice versa) you need to recomplie it, it's not like you need to rewrite it.

  27. Re:Russia is cracking down on piracy, Linux spread by Alex+Belits · · Score: 2, Informative

    It's "Academy [of Sciences] town" in Russian.

    --
    Contrary to the popular belief, there indeed is no God.