Analyst: Vista Delay in Europe Will Hurt Partners, Consumers

Microsoft and European officials need to work together to ensure that the Windows Vista operating system launches on time, an analyst says.

Microsoft and European Community regulators need to find common ground when it comes to Windows Vista, and do it soon, industry watchers are saying.

The long-awaited operating systems European debut could be delayed by regulators for anti-competition reasons. But a later arrival of Vista is likely to do more harm than good, said Roger Kay, the president of Endpoint Technologies Associates, in Wayland, Mass, who said he believes customers and partners will suffer the consequences.

Kay argued in a new paper that getting Vista to the European market at the same time the operating system launches in the United States is critical. A delay, he wrote, could have meaningful economic consequences for Microsofts European partners and customers.

"It would be an oversimplification to say that its just a matter of Old Socialist Europe putting up artificial barriers to Unfettered Capitalism as represented by Microsoft, or that with malevolent intelligence a rapacious behemoth is intent on looting a helpless region. Both sides have a point," Kay wrote.

/zimages/2/28571.gifClick here to read more about the progress of Windows Vistas promised security upgrades.

On Sept. 7, a Microsoft spokesperson told eWEEK that Vistas European launch could be delayed because of problems with European Commission competition laws. European officials have argued that the new operating system contains security features that would violate those laws. On Sept. 14, Microsoft said the launch was still on schedule but that it was asking for more details from the European Commission.

The stakes for a successful Vista launch in the United States and abroad are enormous for the Redmond, Wash., software giant. To show that the issue affects more than Microsoft, the company sponsored a study that concluded that Vista could create 100,000 jobs in Europe.

In his paper, Kay argued that the two sides appear to be much closer to an agreement than they may seem, but certain issues in the security arguments could cause problems in the coming weeks. "The sides are not too far apart, but a gap, sufficiently large to cause a potential delay in the European launch, still exists," he wrote.

Kay continued, "This outcome would be unsatisfactory for Microsofts European partners and customers. The partners, primarily distributors and hardware OEMs (e.g., Acer, HP, Fujitsu-Siemens), would experience delayed revenues. The customers could fall behind overseas competitors that have earlier access to the new software and related hardware and services."

Microsoft has already overcome one hurdle by not bundling Security Center with the rest of Vista, but offering it as a "neutral dashboard." For European consumers, this means the operating system will recognize whatever security software is already there. The move is less significant for businesses, since IT departments or OEMs will use their own security technology, according to Kay.

/zimages/2/28571.gifWill compatibility with older applications be a problem with Windows Vista? Click here to read more.

European regulators are also concerned about a hard drive encryption feature called BitLocker, Kay wrote, on the grounds that "indigenous security companies may lose business if the utility comes with Vista. Microsofts position is that BitLocker is offered on two versions, Enterprise and Ultimate, which are more expensive than the main business and home versions, and so, even if BitLocker is bundled physically, it is not bundled financially, in that the company is charging more for the versions that include BitLocker. An enterprising supplier could put its own encryption software on Vista Business or Vista Home Premium and charge for it."

The problems, as Kay sees it, are that the Europeans have been slow to respond to Microsoft, and that the company needs to make final adjustments to its code for the launch to happen.

"Microsoft wants to ship Vista," Kay wrote. "It can make changes, but the later it receives guidance, the more delayed the introduction will be."

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