Microsoft must share code with rivals
By MATT MOORE, AP Business Writer
10 minutes ago
LUXEMBOURG - Microsoft lost its appeal of a European antitrust
order Monday that obliges the technology giant to share
communications code with rivals, sell a copy of Windows without
Media Player and pay a $613 million fine the largest ever by EU
regulators.
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The EU Court of First Instance ruled against Microsoft on both
parts of the case, saying the European Commission was correct in
concluding that Microsoft was guilty of monopoly abuse in trying to
use its power over desktop computers to muscle into server
software.
It also said regulators had clearly demonstrated that selling media
software with Windows had damaged rivals.
"The court observes that it is beyond dispute that in consequence
of the tying consumers are unable to acquire the Windows operating
system without simultaneously acquiring Windows Media Player," it
said.
"In that regard, the court considers that neither the fact that
Microsoft does not charge a separate price for Windows Media Player
nor the fact that consumers are not obliged to use that Media
Player is irrelevant."
But it did overturn regulators' decision to appoint a monitoring
trustee to watch how Microsoft had complied with the ruling, saying
the Commission had exceeded its powers by ordering Microsoft to pay
for all the costs of the trustee.
Microsoft, which made $14.07 billion in profits during its last
fiscal year, can appeal the decision to the EU's highest court, the
European Court of Justice, within two months.
"I don't want to talk about what will come next," said Microsoft
lawyer Brad Smith in answer to questions about the possibility of
an appeal. "We need to read the ruling before we make any
decision."
European Union Competition Commissioner Neelie Kroes urged
Microsoft to act on the 2004 antitrust ruling.
"The court has upheld a landmark Commission decision to give
consumers more choice in software markets," Kroes said in a
statement. "Microsoft must now comply fully with its legal
obligations to desist from engaging in anticompetitive conduct. The
Commission will do its utmost to ensure that Microsoft complies
swiftly."
Kroes called the decision "bittersweet," saying software customers
still have no more choice than they did three years ago.
"The court has confirmed the Commission's view that consumers are
suffering at the hands of Microsoft," she said.
She refused to say if EU regulators would follow up antitrust
worries they flagged last year with Microsoft's new Vista operating
system, saying only that "if it is not in line with our policy,
then we will act."
The ruling showed that handing over key interoperability code that
helped rivals make compatible products was required in the software
market, she said.
The European Committee for Interoperable Systems called the ruling
a good result.
"It's a very good day, for it signals that there will be fair
competition for the sector," said Maurits Dolmans, a lawyer for the
group.
In its 248-page ruling, the court upheld both the Commission's
argument and its order for Microsoft to hand over information on
server protocols to rivals. Microsoft had claimed these were
protected by patents and the Commission was forcing it to give away
valuable intellectual property at little or no cost.
The court confirmed "that the necessary degree of interoperability
required by the Commission is well founded and that there is no
inconsistency between that degree of interoperability and the
remedy imposed by the Commission.
