Could Microsoft kill the antivirus industry?

Stuart Turton Read more January 7, 2010

Rivals such as Symantec dismissed Microsoft’s free antivirus software as offering “a false sense of security”, but the numbers speak for themselves.

Could Microsoft kill the antivirus industry?

In its first week of release, Microsoft Security Essentials registered 1.5 million downloads – with Windows 7 testers accounting for the lion’s share, suggesting those without current security software are more than willing to give it a go.

There’s little doubt the package has Microsoft’s rivals rattled, but could Security Essentials one day pose a threat to the security industry? As a standalone product it’s certainly competitive, with our own review summing it up as “free, simple, light and impressively effective”, but what would happen if Microsoft began bundling it with Windows?

Windows 7 already includes a firewall and antispyware software – throw in a decent antivirus package and it’s harder for people to justify paying £40 or more for a full security suite.
“If Microsoft automatically included an antivirus package within the OS, then there’s no need for the customer to go and buy a rival package, so it would definitely be a problem It’s such dilemmas that normally attract the attention of regulators, especially when Microsoft’s involved. The European Commission has already tapped the software giant for a combined 1.35 billion euros in fines for anticompetitive behaviour and failing to comply with its rulings.

The European Commission refused to comment on what would happen if Microsoft bundled Security Essentials with Windows, but Alan Davis, a competition partner with the law firm Pinsent Masons was less reticent.

“The EC steps in when a product removes the incentive for a customer to go elsewhere and get a competing product,” he said. “If Microsoft automatically included an antivirus package within the OS, then there’s no need for the customer to go and buy a rival package, so it would definitely be a problem.”

But while Davis believes the EC would get involved, he isn’t convinced it would be an open and shut case. “In the current climate, Microsoft could claim that it’s important customers have a basic level of protection and that’s all it’s offering. That could be a solid defence: it’s now become almost necessary, like a medical vaccination.”

It’s an argument that analyst Rob Enderle believes could buy Microsoft support from governments, which are becoming increasingly twitchy about the impact of cybercrimes on the economy. “Better security has been the top request for years from Microsoft customers and it would go a long way towards the elimination of botnets and reducing the potential for a nationwide attack on government systems. You could see homeland security agencies actually promoting this approach,” said Enderle.

Not surprisingly, this argument doesn’t play well with rivals. “It greatly benefits consumers when Microsoft improves the security of its core operating system, but bundling free antivirus software is a different thing,” argued Mikko Hypponen, chief research officer at F-Secure.

“I don’t think Microsoft would bundle antivirus software with the Windows operating system. It would definitely have an adverse effect on innovation and development in the field of IT security, and in the security industry innovation and research is critical to stay ahead of the game. Bundling would not be good for consumers.”

Microsoft played coy when we asked whether it would consider bundling Security Essentials with Windows, but it did open up another interesting possibility, with the company admitting it may consider offering the antivirus package through Windows Update should it see enough demand. So, where would the EC stand on this?

“If Microsoft isn’t offering antivirus with the Windows package there’s probably less concern, because customers have the freedom to go and buy another antivirus package from the shelves,” said Davis. “However, if it’s known to the consumer that they can go and obtain this for free through Windows Update, they might not think about buying it elsewhere. The Commission may not look too favourably on this.”
Microsoft can build a very secure product of very high quality, but people will not believe in the brand Neither would Microsoft’s rivals, presumably. However, Eugene Kaspersky, founder of Kaspersky Lab, believes that even when offering a free package, Microsoft will have a hard time convincing customers to trust it. “Security is not part of Microsoft’s identity,” Kaspersky said in a recent interview with ZDNet Asia.

“Microsoft can build a very secure product of very high quality, but people will not believe in the brand. OneCare was good enough. They got very good engineers, a very strong lab – all the resources were in place. From the beginning, the product was good enough but it didn’t take market share at all.”

Which brings us back to those 1.5 million downloads. If Microsoft was looking for an indication of demand, this certainly fits the bill, and it seems likely Security Essentials will be arriving on Windows Update sooner rather than later. Only then will we find out whether the EU will act, and whether Microsoft has more than caustic comments from its rivals to worry about.