updated 6/22/2005 8:11:00 PM ET 2005-06-23T00:11:00

In Microsoft's new operating system — Windows XP N — the "N" stands for "Not with Media Player." But it might as well stand for "No Thanks." PC makers and distributors are holding back from buying the new alternative version of Windows XP that Europe's competition commissioner ordered Microsoft Corp. to offer as part of the punishment in the software maker's long antitrust battle with the European Union.

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Windows XP N was released to distributors last week in English, French, German, Italian and Spanish and will be available to the public in the next few weeks. Versions in 10 additional languages will be released in July.

The world's largest software maker had to change its Windows operating system after EU antitrust regulators ruled last year that it abusively wielded its Windows monopoly and locked out competitors. Microsoft was fined a record euro497 million ($608 million).

But computer distributors and manufacturers are so far showing little interest in the new product, which compels consumers to choose their media player and download it from the Internet.

And that raises questions over the effectiveness of the media player component of the antitrust ruling.

"We don't see any interest at all in the product for the consumer," said Lionel Jarlan, computer buyer at France's Fnac department store chain. Fnac will be testing the product in a limited range of stores. They are expecting a first delivery at the beginning of July.

Many stores say they will not bother stocking the product.

"We'll continue to sell the old version because it's obviously better value for our customers," said Gina Jones, spokeswoman for PC World, Britain's leading PC retailer.

Microsoft is offering Windows XP N for the same price as the standard version of Windows XP.

Spanish online computer store Publinet has not ordered the product.

"We'll first see how it sells. I heard that this version would be cheaper," said Jose Cabeza, technical director for Publinet. "If it isn't, logically the market will decide about it. I don't see why a client on the street would choose a lesser product."

Several PC makers said they had no plans to install the new version of Windows XP because they did not expect a demand for it.

"This comes down to resources in terms of changing over as well as little evidence from consumers asking for 'N' specifically," said Ken Chan, portables product manager for Toshiba.

Sony and Dell said they did not intend to install the new product in their computers.

"From our experience, customers purchasing computers expect them to come equipped with the capability of playing back digital media files," said Dell spokesman Liem Nguyen.

Changes to the version of Windows XP without Media Player came after EU regulators were not convinced the Windows version the company was forced to produce without Media Player was technically up to standard.

Microsoft and the EU are still negotiating its compliance with another EU order — that the company share Windows' source code with competitors who make server software so their products can better communicate with Windows-powered computers.

The EU can fine Microsoft up to 5 percent of its daily global sales for each day that a decision is not applied to the EU's satisfaction.

Microsoft initially wanted to call the new version of its consumer operating system "Windows XP Reduced Media Edition" but EU regulators said that name would discourage sales.

"We have made these products available to our standard distribution channels, as the EU commission outlined. Now its up to computer manufacturers, distributors and customers to decide whether to order the product," said Derek Delmartino, spokesman for Microsoft in Brussels. Sales could not be calculated for at least a month, he added.

Software buyers said clients for the new product would have to be extremely well-informed.

"I think they'll be a minority of clients, maybe product developers, but a minority who will buy the product," said Stefan Decque, a software buyer at Surcouf computer store in Paris.

Jarlan pointed out that it is easy to uninstall Media Player from the complete version of Windows XP if clients want to avoid it.

"It's a militant act for a customer to buy the new version," he said.

Copyright 2005 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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