10 Ways To Stifle Tech Competition - InformationWeek

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5/11/2012
08:32 PM
Thomas Claburn
Thomas Claburn
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10 Ways To Stifle Tech Competition

Competition happens, unless you can avoid it. From Microsoft Windows RT to Google Chrome, here's how today's giants safeguard their turf.

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The funny thing about the tech industry is that everyone talks about competition but no one wants to compete, at least not on a level playing field.

Today's tech giants are fine with competing on their own terms, terms that give them an advantage. They're not so keen to participate in a fair fight.

Usually, tech companies rely on the legal system to insulate themselves from competition. When Apple sued HTC two years ago, then-CEO Steve Jobs condemned HTC for infringing Apple's patents. "We think competition is healthy, but competitors should create their own original technology, not steal ours," he said.

Microsoft said as much protesting the European Commission's 2004 finding that the company had abused its PC industry dominance. As a remedy, the European Commission required that Microsoft disclose its interface documentation to allow non-Microsoft servers to work with PCs.

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Microsoft objected to this requirement. "[T]he compulsory license will allow competitors to replicate Microsoft's technologies such that their products would be indistinguishable from Microsoft's products in important respects," the company said. "This outcome will largely eliminate incentives for these companies to develop alternative or better technologies--precisely the opposite of what competition law is intended to achieve."

Occasionally, a company will acknowledge wanting to avoid competition. AT&T CEO Randall Stephenson, for example, recently suggested that Google and Mozilla object, knowing that their browsers can't compete on Windows RT devices without access to those APIs.

Harvey Anderson, general counsel for Mozilla, said Mozilla isn't presently pursuing the issue with the Federal Trade Commission or the Justice Department. "We will continue to evaluate and see if that will be the appropriate mechanism to get the resolution that we seek," he said in an emailed statement.

2. Apple's iOS
Apple has not been shy about using patents and copyrights to limit competitors. But it also relies on contracts to constrain developers and makers of peripherals that interface with Apple products. In some circumstances, Apple couples contracts with technological barriers. Apple's rules prevent the use of writable, executable memory pages, except for its own Safari browser. Apple, in other words, is imposing the same kind of restriction as Microsoft is in Windows RT to preclude the possibility of JIT compilers, which are essential for the operation of modern browsers.

Mozilla is less bothered by Apple's barriers, presumably due to its traditional focus on desktop browsing. "The similarities to iOS don't justify an outcome on Windows that deprives users of choice, reduces competition, and hurts innovation," Mozilla's counsel Anderson said. "The difference here is that Microsoft is using its Windows monopoly power in the OS market to exclude competition in the browser market. Microsoft also published commitments to users, industry, and software developers ... that in essence said Microsoft would design Windows to allow choice and provide a level playing field for third-party applications like the browser. These factors create a situation that is materially different than iOS."

Perhaps, but the situation is not so materially different that we have Firefox or Chrome for iOS.

3. Google's Chrome OS
How do you avoid competing with other browser makers? Make an operating system with a built-in browser. Chrome OS supports only Google's Chrome browser. That's the way it was made. When Microsoft tried that, the European Commission forced Microsoft to stop bundling its operating system and browser. But Google has gotten away with it, largely because so few people are using Chrome OS devices. Why worry that the playing field isn't level if Google's team is the only one that showed up for the game?

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