BBC Homepage World Service Education
BBC Homepagelow graphics version | feedback | help
BBC News Online
 You are in: Business
Front Page 
UK Politics 
Market Data 
Your Money 
Business Basics 
Talking Point 
In Depth 

Wednesday, 20 December, 2000, 13:44 GMT
Gates takes aim at AOL
Bill Gates AP
Bill Gates is concerned about AOL dominance
By BBC News Online internet reporter Mark Ward

Microsoft has complained to the US Government about the monopolistic actions of a rival.

On 14 December, Microsoft chairman Bill Gates rang senior members of the Federal Communications Commission urging them to investigate AOL's dominance in instant messaging software.

Mr Gates wants the commission to investigate AOL, which he feels is abusing its position by stopping rival software working with its messaging programs.

But the row could be rendered irrelevant by new software that lets instant messaging programs talk to each other.

Tables turn

For the last two years, Microsoft has been fighting claims that the software giant has abused its dominance of the desktop operating system market.

In court, the US Justice Department tried to show how Microsoft used this dominance to shut out competitors and protect its monopoly.

Now, in a development ripe with irony, Microsoft is complaining to US Government regulators that rival AOL is doing exactly the same thing - only this time Microsoft is the victim.

The row centres on instant messaging software that, as its name suggests, lets people swap messages immediately. AOL, with almost 30 million subscribers and control of the AIM and ICQ programs, dominates this market.

Blocking tactics

Earlier this year, Microsoft produced software that let users of its instant messaging software swap messages with people using AOL's. Soon after AOL blocked the software citing security and privacy concerns. It has promised to open up its software to others by June 2001.

Now, Microsoft has turned to the US Government for help in getting access to the AOL programs.

"[Instant Messaging's] potential to become a robust platform will be fully realised only if [it] shares the features of openness and interoperability that characterise both the public telephone network and the internet," said Microsoft in a statement filed with the FCC.

The FCC is believed to be considering making the opening up of the messaging software a condition of its approval for the merger between AOL and TimeWarner. Last week, the Federal Trade Commission gave permission for the merger to go ahead.

New entrant

In its defence, AOL said its share of the instant messaging market was rapidly diminishing and pointed out that Microsoft was planning to bundle instant messaging software with future products which would only erode its dominance further.

In the past, Microsoft has used this tactic to whittle away at the dominance of companies such as Netscape and Lotus.

But the row between the companies could be rendered irrelevant by the work of programmers behind Aimster. This program allows people to swap files among themselves, and the latest version of the software links to all the main instant messaging systems letting users swap messages too.

AOL has yet to say whether it will block Aimster users from swapping messages with its subscribers.

Search BBC News Online

Advanced search options
Launch console
See also:

15 Dec 00 | Broadband
Microsoft warns of tough times ahead
14 Dec 00 | Business
AOL-Time Warner merger approved
11 Jan 00 | Business
Can the internet save 'old media'?
10 Mar 00 | Business
Microsoft opens the X-Box
27 Oct 00 | Business
Microsoft software 'stolen'
26 Oct 00 | Business
Microsoft relaunch for MSN
26 Sep 00 | Business
Time on Microsoft's side
01 Sep 00 | Sci/Tech
Ready, Aimster, Swap
Internet links:

The BBC is not responsible for the content of external internet sites

Links to more Business stories are at the foot of the page.

E-mail this story to a friend

Links to more Business stories