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Will EU fine make a difference to Microsoft?

By csmonitor.com staff


A couple of years ago, when the Justice Department's lawsuit against Microsoft was stopped, and a weak settlement put in place (although it is still under appeal), there were many tech commentators, and more than a few attorneys general, who worried that the settlement would change Microsoft's predatory practises very little.

Now that the European Union Commission has give Microsoft a $613 fine, the Economist asks the question "Can Microsoft be tamed?" And basically, the answer is no – that Microsoft will continue with its tactics of trying to destroy any and all competitors it finds in areas that it wants to control.

Most important of all is what the ruling will mean for Microsoft's plans to conquer yet more markets. The company is believed to be integrating an internet search facility like Google (which Bill Gates greatly admires) into its new version of Windows, codenamed Longhorn. The European Commission has not specifically banned any further bundling – it says this will be dealt with on a case-by-case basis. Perhaps this week's ruling will prove strong enough to stop Microsoft from tying its products to Windows in order to storm new markets. But if the past is a guide, that seems unlikely. And with the appeal process set to last for years, it is hard to see Microsoft being swayed from its usual strategy: bundle now, litigate later.

EUBusiness says Microsoft rivals, like Bob Kimball, vice president and general counsel at RealNetworks, are very happy with the ruling.

"This decision is fundamentally significant because the European Commission has formally declared that Microsoft's media player bundling strategy is illegal and has established the guideposts for future bundling cases," said Bob Kimball, vice president and general counsel at RealNetworks. RealNetworks was a key firm in the EU case because it complained that Microsoft's "bundling" of its media software for audio and video within the Windows operating system was an abuse of the Microsoft monopoly position.


For its part, Reuters reports, Microsoft says it will continue to try and reach a settlement with the EU Commission, regardless of the fine.

"We've worked extremely hard to arrive at possible remedies to address their concerns, Microsoft Chief Executive Steve Ballmer told reporters in a conference call. "The commission nonetheless decided to pursue the much riskier course of litigation," Ballmer said, adding that Microsoft would appeal the decision.

ZDNet has an interesting piece about Mario Monti, the EU's top antitrust enforcer. Mr. Monti apparently sat down one on one with Mr. Ballmer recently, and while Ballmer tried to intimidate Monti, the Monti apparently was unmoved by the "boisterous" Ballmer.


Information Week says the EU fine is not the end of Microsoft's troubles.

For me, it seems the more things change, the more they stay the same. Microsoft won't change one bit. (by Tom Regan)

 
 

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