The EU and Microsoft: a culture clash

Posted on Thursday, April 30, 2009 by Erlik

Many US people seems to be puzzled by the attempt of the EU to regulate what Microsoft can bundle in Windows, and some consider that it is making double standards compared to other minor players such as Linux or Apple.

Actually it is not abnormal for governments in Europe to impose stricter regulation on a particular company if this company is dominant in it's market. This comes from the deregulation of states monopolies for telecoms, water and energy. When these markets were opened the historical provider had almost 100% of market share. Since having a large market share in such markets allows a company to gain an advantage over its smaller competitors, regulators forced the dominant company to provide services to its competitors at an imposed price, make investments that would also benefit their competitors etc...

This strategy worked quite well and the Internet provider market for example is now much more competitive in Europe than in the US (I can choose between 1 cable provider, 1 Wimax provider and about 5 different ADSL providers).

As a result it is now very much in the habit of European legislator to create competition in a market by imposing much stricter regulation on a dominant player than on a minor player in that market. This is done to compensate the fact that being a dominant player is in itself an advantage that the legislator considers unfair!
Image cc by TechFlash_Todd

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