Survey: ISP deals favoring IE

Nine months after the Justice Department accused Microsoft of stifling competition in the Internet software market, it has become harder for newcomers to the Net to obtain browsers made by rivals of the software giant, a new report contends.

Although Microsoft has dropped provisions in licensing agreements that require Internet service providers to promote its Internet Explorer browser over Netscape Communications' Navigator, residual effects remain, according to the report issued by Microsoft critic NetAction.

"The disturbing reality is that the four largest retail Internet service providers, with a combined subscriber base of over 20 million customers, distribute only Internet Explorer to their customers," the report states. "Compared to NetAction's survey a year ago, Microsoft's dominance has only grown."

Microsoft dismissed the report. "Consumers have always had complete freedom to use any browsing technology they want," said spokesman Jim Cullinan. "That continues to be the case."

Cullinan questioned NetAction's impartiality, contending that the group receives in-kind support from Microsoft competitors. NetAction denies this.

The report comes at the same time as a new survey showing that Navigator lost another 8.9 percent of the browser market during the past six months, while Internet Explorer gained 9.6 percent. Still, the report, issued by AdKnowledge, estimated that more than half the market--52.2 percent--still uses Netscape's browser, making it the dominant player.

Netscape spokeswoman Lynn Keast said the company's own estimates peg Navigator's market share at between 56 percent and 58 percent. She declined to comment on NetAction's report.

NetAction said it surveyed the top 17 ISPs that serve individual subscribers to find out what browser is provided to new subscribers. Of those, five providers--soon to be six--provided Internet Explorer only, even when subscribers asked for an alternative, NetAction contended.

This comes amid a flood of new users taking to the Net, projected by some analysts to reach 160 million by the end of 2000. "Computer novices are unlikely to second-guess the browser choices made by their Internet service provider, so Microsoft has an overwhelming advantage in expanding its browser market share," the NetAction report stated. "Microsoft continues to expand its anticompetitive advantages in the marketplace and continues to erode consumer choice."

The report added that the issue goes well beyond what browser--both of which are free--a Web surfer decides to use. "If Microsoft is allowed to control how consumers access the Internet, the company will substantially control Internet standards," it explained. "If Microsoft controls browsers, it will be able to decide what kinds of software and what Web site designs can be 'read' by any Internet consumers."

According to the report, the four largest providers of Internet service--America Online, Internet MCI, Microsoft Network, and CompuServe--bundle only Internet Explorer with the software they ship to new subscribers, even when the customers ask for an alternative browser.

Also, AT&T's WorldNet, will ship Netscape if a customer asks, but the report contends that "[AT&T] customer service agents discourage customers from choosing Netscape if they request it."

However, in three calls made to WorldNet's customer service, agents said users were free to use either browser, and offered to ship Navigator upon request.

Other smaller ISPs-including Prodigy, MindSpring, and Concentric Network--also decline to include Navigator in their start-up kits.

By comparison, three, relatively small services ship Navigator exclusively, according to the report. They include Pacific Bell Internet, Bell Atlantic, and Ameritech.

Ed Hansen, a spokesman for MindSpring, confirmed that the Atlanta-based ISP ships only Internet Explorer to new customers using Intel-based computers. Customers using Apple Computer Macintoshes receive Netscape's browser.

"We can't do a custom CD for every customer, so we have to make choices up front about how to best serve our customers," he said. "We had a difficult time working with Netscape in many different ways, and found Microsoft was an easy company to do business with. We've never felt any pressure from them to do anything we didn't feel comfortable doing."

AOL spokeswoman Wendy Goldberg said Internet Explorer is imbedded into its user software. AT&T spokesman Jonathan Varman conceded that a set-up software kit given to new users does not include Navigator unless requested. Both added that their services allow users to obtain the Navigator browser easily, however.

A recent poll conducted by the New York Times cast the majority of Net users as "passive recipients of computer technology," finding that more than half had never installed a software program.

Representatives from the other ISPs could not be reached for comment.