Microsoft and the Evil B Word

Opinion: Microsoft may have cleaned up its legal problems just to be ahead of the new ones that will result from bundling software and services.

The discussion as to whether and what Microsoft should bundle with Windows Vista may be just a tad off the mark. Why? Because bundling just isnt what it used to be. And thats because the line between software and service is evaporating, at least to the extent Microsoft can make it happen.

Bundling is, of course, one of those things that get Microsoft in trouble. Even if the bundling is good for customers, like tightly coupling the browser to the operating system, or providing a built-in media player.

Still, it should be remembered that the Microsoft Empire has bundling at its foundation, given the huge contribution the bundled applications known as Microsoft Office makes to the companys bottom line.

Microsoft Office came about at a time when Microsoft was getting its clock cleaned by WordPerfect and Lotus. Microsoft responded by throwing all the apps together into one box, including PowerPoint for free.

That giveaway made presentation software "free" and though PowerPoint wasnt the best of the bunch, bundling put companies like Micrografx and Software Publishing Corp. (Harvard Graphics) out of business.

That was the moment when Microsoft should have been broken up. Everything thats happened since is just predicate. But, I digress…

/zimages/1/28571.gifTo bundle or not to bundle: that is the Microsoft security question. Click here to read more.

Youll remember last weeks shindig with Bill, Ray, and the boys in San Francisco, where Microsoft introduced Windows Live and Microsoft Office Live. One of the components of Windows Live is anti-virus and anti-spyware, available free as a basic service thats delivered from the Windows Live site.

Of course, running either "service" requires downloading a bit of client software, which may or may not hang around for future use.

Does that mean Microsoft is "bundling" anti-virus and anti-spyware with its operating systems? Or is it merely providing a free service? And, from a competitors point of view, does the distinction really matter?

I am not sure it does, though delivering the software/service online rather than including it as a desktop application somehow seems different.

I am not sure its impact on customers will be. Bill Gates is famously reported to have once commented that he wasnt so worried that Microsoft lost a big sale, but that a competitor got the business instead.

Microsoft is uniquely able to create a suite of products or services that smites several competitors at once and creates a package only Microsoft can offer.

The anti-virus and anti-spyware companies cant compete head-to-head with Windows Live since they dont have the breadth of product offerings that Microsoft has and its competitors have been unwilling to band together and gang up on Redmond.

Of course, if there is anything that should be bundled with the operating system, it is software that fixes problems the operating system causes. I am glad Microsoft finally agrees with me that its customers shouldnt have to pay for protection from viruses and spyware.

However, Microsoft also appears set to more closely integrate its free e-mail service with Vista, perhaps by turning Outlook Express into a client for Windows Live mail or MSN mail. This takes advantage of Microsofts effective monopoly over desktop operating systems.

Id be interested in hearing what Microsofts take on this would be, since bundling a better (and dedicated) Mail client would to be taking a big swipe at Yahoo, Google, AOL, and anyone else who offers a free e-mail service.

If I were in the legal department of any of these companies, or at the Department of Justice, Id be sharpening my pencils and ordering a new stack of yellow notepads.

It many turn out that Microsoft cleared up its old legal battles just in time to have a clean slate for the new courtroom challenges that software-as-a-service will present.

Contributing editor David Coursey has spent two decades writing about hardware, software and communications for business customers. He can be reached at

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