I read an interesting piece today over on the Microsoft Monitor Blog by Joe Wilcox on "web-to-desktop bundling". Here's a quote:
Microsoft partners and competitors should be concerned by the integration. Windows is supposed to be a neutral development platform. Windows Live competes with many Microsoft partners (as well as competitors). Remember, Microsoft rebranded its MSN services as Windows Live for a reason. Those services are about enhancing Windows and generating more Windows upgrades. Way I see it, Windows Vista hooks to "Live" would favor Microsoft products and services, which isn't a neutral platform position.
Here's where I think the argument falls short:
1. Users expect their web browser to be capable of searching the web - out of the box.
Simple idea. You open your web browser and you expect to be able to search the web. You expect to see a search box which is connected to a search engine. You expect to be able to type something into the address bar and have a search performed if no address is found. This expectation has been set - by IE, by Firefox, by Safari.. the list goes on.
Is this "web-to-desktop bundling"? Maybe. Is it a bad thing? Absolutely not. Consumers expect their web browsers to have this functionality. And this is a prime example of integration between a desktop application and a service delivered over the web.
As long as the desktop app (in this case the web browser) is built to work with any web app (in this case the search engine), and visa-versa, then the issue really boils down to one of default configuration.
The barrier to switching search engines by changing the default configuration (usually by clicking a link on a web page or similar) is miniscule compared to let's say, installing a new piece of software.
2. If configuration defaults do matter, it's hardly Microsoft that you should be worried about.
IE, Firefox, Safari, and every other web browser come configured with a default home page, and a default search engine, to meet the user's expectation of the web browser being able to search the web.
However, when you buy your new Windows-based computer from Dell, your default home page is not MSN/Windows Live, and your default search engine is not MSN/Windows Live. If you've bought a new Dell recently, when you make a mistake typing in a url into the address bar in IE, you're taken to a Google search page. Guess who splits the revenue from the ads on that page: Google/Dell!
In the case of Windows Mobile devices, Microsoft almost never has control over the configuration defaults, because the OEM always installs Windows Mobile and has almost complete control over the defaults. So, for example, when you pick up your new Windows Mobile Treo, the search box on the front page also is configured by default to search Google (again, Palm/Google deal in effect).
So, while I would usually agree with Joe Wilcox's point that bundling is generally assurance of some success, I don't think it applies to what he refers to as "web-to-desktop bundling", where in reality, it's more and more the distributors (OEMs) that make the money off of default configuration, and not Microsoft, and where the barrier to switching is so low that it's arguably insignificant.