UK trade group TIF (the Infrastructure Forum) confirmed Monday that it has asked the OFT (Office of Fair Trading) to launch an investigation into the software pricing policy for Microsoft's upcoming Windows XP operating system.

TIF sent a letter on Friday to Secretary of State for Trade and Industry Patricia Hewitt requesting the investigation, a TIF spokeswoman confirmed. TIF is a membership organisation comprising IT managers from companies including British Airways, the BBC, Lloyds TSB and GlaxoSmithKline.

The Department of Trade and Industry declined to comment.

Microsoft plans to launch Windows XP on 25 October but has already weathered heavy criticism for its new licensing program, which organisations such as TIF contend will increase their licensing costs by an average of 94 percent.

Microsoft is touting its new licensing program as simply an attempt to reduce the unlawful copying of its product. When Windows XP is activated on a user's PC, it 'locks' that copy of the software to the hardware configuration of the computer and issues a 25-digit activation number, which Microsoft then stores in a database.

Once the user activates the number by registering it over the telephone, Microsoft can identify when a piece of software is installed on two different PCs. That number must be activated within 30 days or the product will no longer work.

In response to some of the criticism, on Friday Microsoft increased its discounts to customers who want to install the software on more than one home computer. Discounts for the new Additional Family License program, went from around £5 to £8 to between £7 and £20 on additional licenses.

Earlier this year, for corporations, Microsoft extended by five months — from 1 October to 28 February, 2002 — its deadline for enrolment in the licensing program so as to give enterprises additional time to figure the cost of the program into upcoming yearly budget cycles.

All corporations have to upgrade their licensing agreements with Microsoft regardless of whether they are moving to Windows XP or not.

In Europe, Microsoft is already facing an antitrust investigation by the EC (European Commission).

Last month, the EC confirmed that it had merged its two antitrust investigations into Microsoft's operating systems. The EC, which is the executive body of the European Union, is looking into allegations that Microsoft violated European antitrust rules by "using illegal practices to extend its dominant position in the market for personal computer operating systems into the market for low-end server operating systems".