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From: James Love <love@cptech.org>
Newsgroups: misc.activism.progressive
Subject: MS Control of Internet Navigation
Followup-To: alt.activism.d
Date: 22 Jan 1998 20:45:43 GMT
Originator: rich@pencil.math.missouri.edu
Info-Policy-Notes | Available from listproc@cptech.org
INFORMATION POLICY NOTES
January 22, 1998

There is an interesting dialog on roundtable@cni.org on the issue of remedies for Microsoft's anticompetitive conduct. Ted Kircher and others (including CPT) have encouraged a closer look at the type of interoperability remedies that were used to open the IBM mainframe networks to competitors. However, there have been disagreements regarding the usefulness or appropriateness of remedies concerning product integration. CPT thinks curbs on product integration with the Windows operating system (OS) are appropriate, when Microsoft has a 90 percent world market share. Some persons think it is too difficult or unwise for the government to set limits on OS enhancements. In our view, the debate over the Browser integration has several dimensions. There has been a lot of attention to the issue that the Browser itself is like an OS for internet applications. However, too little attention has been given to the role of the Browser as system of menus which guide consumer choices for Internet navigation. In response to a note on this topic, I wrote to roundtable@cni.org

) If Microsoft wants to make Windows 98 a
) billboard for its partners in publishing and electronic commerce, seen
) by consumers when they turn on thier computer, we shouldn't complain?

To which Ted Kircher replied:
) As to your characterization of possible extensions by Microsoft, I think
) this is taking an idea to an absurd/unrealistic/theoretical conclusion.

In my view, this is not absurd, unrealistic or even theoretical. What I described is Microsoft's Internet Explorer 4.0 (MSIE4.0), once you install the program. It puts links to electronic commerce and web publishers right on the screen (before the browser is launched), it and builds the links into the browser, in three separate command menus, including favorites, channels, and the search button. Consider what happens when you do a "search" in MSIE. I have this on my screen as I am typing this. When I clicked do the "search" button, MS installed an active X search "enhancement," which modified by browser on the fly. In addition to the regular keyword search, it now has the following specific menu choices for a search:

Hm, the last one is intriguing. Do you think MSIE takes me to the DOJ web page of its pleadings in the MS case? :-)

It turns out Microsoft has defaulted me to an AOL search menu. I certainly didn't choose this. MSIE is set up so I can change the search links, at least for now, but it gives suggestions about which ones I should consider. In this respect, it useful to note that Microsoft is spending a bundle to develop a search engine it claims will blow away the competition, making Yahoo and others obsolete.

See, for example, Microsoft's October 20, 1997 announcement that it acquired search technology from Inktomi. Microsoft says

The award winning Inktomi technology, combined with Microsoft's front-end interface and integration, will provide online users access to an index of more than 75 million Internet documents, as well as the most up-to-date search results of any online search engine. . . . Through Inktomi's advanced Web-crawling technology, consumers can access a large amount of content that is refreshed daily, as well as a select set of content that is refreshed hourly. The search team dedicated to jointly developing the product will define the most popular sites for these multiple daily updates. The entire index of full-text Internet documents will also be updated every three weeks, making it the freshest, most current index available to consumers. As the Web continues to grow and evolve, the service will expand its database coverage and features to provide consistently accurate and reliable searching.
For more on this see http://www.microsoft.com/corpinfo/press/1997/oct97/inktompr.htm . If Microsoft spends enough money on R&D, and promotes its own search engine via the MSIE, it will have the firm the most profound tool for influencing Internet navigation. How easy will it be to find http://www.essential.org/antitrust/microsoft/microsoft.html on Microsoft's new search engine? Or to find http://www.travelocity.com/ , a competitor of Microsoft's in the travel business? This remains to be seen.

Then of course there is the MSIE channel technology, which is very valuable screen "real estate" for commercial firms, and which appears within the browser, available via the channel button.

Under my "news & technology" channel guide, I see Snap! Online, The New York Times, Time, CNN Interactive, Wired, CNET channel, ZDNet and CMPnet. MSNBC and the MSN have their own categories, giving them even higher visibility. Lifestyle and travel gives me the Discovery Channel, National Geographic, Parent Soup, Epicurious food and travel, plus Microsoft's Expedia Travel. Placement on these menus is a huge factor in attacking consumers. How important is it for Wired to be on this menu? Does this influence Wired and other trade publication reporting?

To give an example of how these menus influence decisions, ask yourself how often you go beyond the first page or two of a search engine's results. When MS bought Web TV, it put Expedia at the top of its travel menu. Sabre says its Travelocity ended upon on the sixth screen, next to Tom's Travel Bug. Sabre says studies found that professional travel agents using online reservation systems choose the first fare shown 53 percent of the time, and choose a fare from the first page, 93 percent of the time. Page 6 for Travelocity was similar to no listing at all.

Yahoo and some other search engines sell directory listings, keyword searches, and high level menus, somewhat like a Yellow pages creates categories and sells large ads. But since Microsoft plans to be both a navigator (creating menus, biasing searches) and a competitor, it gives Microsoft a huge edge in electronic commerce and publishing.

I had an earlier discussion with a editor from the Sacramento Bee about Microsoft's Sidewalk web page, which he said rolled out to yawns in the SF area. I said, what will you think when your readers turn on their computers and press the "classified ads" button, which is hardwired to the OS, and it takes them to Sidewalks classified ads, automatically, based upon their zip code. He said, "that would get our attention."

Microsoft executives, such as Steve Ballmer and Brad Chase, increasing refer to Windows as "the Windows Experience." They see these menus and navigation tools as central to the product, and this is why Microsoft is risking the brand's good will on this issue.

A number of other companies are urging DOJ to bring actions against Microsoft which would give Original Equipement Manufactures (OEMs) like Compaq, Dell, Gateway or Packard Bell, the right to place different menus, channels or links on the "desktop" for new shipped computers, providing a somewhat more level playing field (Travelocity could try to buy the menu location from Compaq, for example). But this itself is probably only one way to deal with this. As I noted earlier, Microsoft's Active X technology is designed to install new menus and functions into the interface on the fly, so whatever a computer is shipped with, it can likely be changed by Microsoft, remotely, once you connect with a Microsoft (or partner) site.

This is something to think about, as we go further down this road.

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