Ultimately, the DOJ and nine states reached an agreement in 2001 which allowed Microsoft to continue bundling Internet Explorer with Windows, but imposed conditions making it easier for competing products to work on the Windows operating system.  The DOJ recently determined that these conditions have been successful in promoting competition, and that no further government oversight is necessary.

Based on this agreement, Microsoft altered its business practices to encourage the development of innovative third-party applications on the Windows platform.  As a result, a competitive and thriving browser market has developed.  Consumers are free to choose from several alternatives to Microsoft's Internet Explorer.  In Europe, the open-source Mozilla Firefox browser is approaching a 30% market share.  Computer manufacturers are free to install any default browser they choose, and consumers are free to alter these preferences at any time.

In the aftermath of Microsoft's agreement with U.S. regulators, Opera Software initially welcomed the opportunity to compete with Microsoft.  Opera CEO Jon von Tetzchner explained in 2002 that "when [Microsoft] entered the market, there was a question of whether we should stay or leave.  But we felt, why shouldn't we?  We believed we could make a browser and commercial product that was good enough to compete against anyone."

After five years, von Tetzchner's product has failed to achieve the success of other browsers such as Firefox, or Apple's Safari.  Backed by a coalition of Microsoft's American competitors, including Adobe, IBM, Oracle, and Sun Microsystems, Opera has asked the European Commission to help foist its unpopular browser on consumers.  Last week, von Tetzchner argued that "we are filing this complaint on behalf of all consumers who are tired of having a monopolist make choices for them."  Instead, Opera now believes that government should make these choices.

In particular, Opera's complaint seeks to force Microsoft to sell a version of Windows either lacking Internet Explorer, or including government-approved competing browsers.  Given the prevalence of Internet use, consumers are unlikely to welcome new computers which lack a pre-installed browser.  Without the ability for computers to access the Internet out of the box, consumers would not even have the means to download the browser of their choice.  Therefore, Opera's proposal would dramatically restrict consumer freedom.  The EC has already witnessed the effect of such restrictions.  When the European Commission required Microsoft to market a version of Windows lacking its popular media player, fewer than 2000 copies were sold across Europe.  The reason for this is simple: consumers prefer more choices, not fewer.

If Microsoft refuses to deprive its customers of web access, Opera suggests that the EC should mandate inclusion of several competing browsers in Windows.  Under this remedy, the government could force customers to accept unpopular or inferior products whenever an innovative competitor becomes too popular.  The EC would become a global road block to innovation, requiring the most successful companies to stop and let everybody else catch up.

European regulators have made it clear that this philosophy will extend beyond Microsoft.  An article in Sunday's New York Times describes how Google is gaining dominance in Internet applications and advertising, and may soon displace Microsoft as the world's most valuable technology company.  European antitrust regulators are eager to take on this emerging tech giant, recently escalating their investigation of Google's proposed merger with Internet advertising company DoubleClick.

If the EC follows Opera's logic with Microsoft, they may be compelled to force Google to offer access to competing applications.  For instance, Gmail users could be redirected to Hotmail, Google Maps users to MapQuest, and Google Apps users to OpenOffice.  Even though consumers may prefer the Google products, government regulators would be free to level the playing field and micromanage the layout of Google's website.