[Infowarrior] - EU: Microsoft Must Share Code With Rivals

[Richard Forno]

Microsoft Must Share Code With Rivals

By MATT MOORE
The Associated Press
Monday, September 17, 2007; 7:48 AM

http://www.washingtonpost.com/wp-dyn/content/article/2007/09/17/AR2007091700
235_pf.html

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.

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.

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On the Net:

Court Ruling: http://tinyurl.com/3x2pze
© 2007 The Associated Press