By Jo Best, 27 January 2004 15:40
NEWS Just one day after Microsoft chairman Bill Gates picked up an honorary knighthood, it looks like an EU investigation into the software company's anti-competitive behaviour is set to rule against Redmond's finest.
While the ruling is still in its draft phase, and details of any final decision are yet to be made public, all the signs are that it won't be going Microsoft's way. The EU's Competition Commissioner, Mario Monti, has been touting the draft resolution over the Windows Media Player dispute around various departments in the EC which EU commentators believe rarely happens in cases where antitrust cases go in the company's favour.
While the prospect of Microsoft getting a legal kicking might not cause many tears outside of Redmond, the software company could well be a pawn in a larger political battle. Transatlantic tensions may be affecting Microsoft's treatment at the hands of the EU, according to James Governor, principal analyst at RedMonk.
"The unilateralism of the US will make it harder for the EU to make a sensible judgement. Whatever happens, there will be a lobby in America that will turn around and say Europe is just trying to protect itself, they're afraid of competition and it's an attempt to block Microsoft from succeeding," he told silicon.com. "The situation is exacerbated by the US political situation. The problematic transatlantic relationship is why the EC has worked so hard not to mess it up."
The final ruling will no doubt come as a blow to Microsoft, already in the middle of legal wrangling on the other side of the pond with US authorities over whether it has broken its antitrust agreement. It's thought that should the European decision go against Microsoft, the penalties for breaking competition regulations could include a fine of up to 3bn, as well as strict edicts designed to alter the way Microsoft sells its products.
Neil Warick, EU and competition partner at law firm Dickinson Dees, believes that a fine is extremely probable. "A fine is more likely than a behavioural order," he told silicon.com. "It's common sense the Commission is understaffed and they don't have the spare bodies to police an order," he said, adding that Microsoft shouldn't expect an easy ride from the EC. "The US legal system is more about plea-bargaining and finding a solution," he said. "In Europe, it's not about finding a remedy, it's about punishing them."
But Governor wouldn't be surprised if the EU didn't a levy some fine but said he thinks there will be more to any judgement, adding he expects to see the presence of interoperability in any settlement.
'Don't expect a quick decision' seems to be the message from the legal fraternity the investigation itself has already lasted three and a half years and the case is unlikely to come to a conclusion without an appeal from the Gates camp, which has the potential to drag the case out for several years to come. The case even has the potential to drag on for a decade, Warick said.
Even then, the legal battle for Gates and co might well take a different tack. Once the EU battle is over, it's possible for individual European countries to pursue their own antitrust suits against the company.
Comments
There are 6 comments. Join the discussion
1. Dominic Tristram
Microsoft should pay the fine of course, but what really needs to be done is for EU goverments to stop giving them business. There can be no fair market while companies try to lock people in to thier custom file formats and protocols. The EU should have a policy of only allowing government organisations to use software that works on these protocols, that was people can use products such as OpenOffice if they wish.
If Microsoft software really is worth the money then we'll see it sell well when people aren't forced to buy it over the alternatives. This is what Microsoft are scared of from the EU, not fines.
2. Allan McBain
Microsoft - a Utility company.
Once upon a time there were electricity supply cables by the dozen running through our streets, each owned by a different company with its own standards for supply. At some point a standard became adopted, which means we ca all use electricity at any touch point and don't need re-training every time we want to plug something in.
Either the EU legislates that, for example, all electrical appliances have to be able to run on 110 volts as well as 220/240, or we should all accept that Microsoft has effectively become a utility company in the provision of operating systems and Office software and look to how we deal with that.
The simple answer would be to standardise it and regulate it in terms of price and universality of availability.
Or maybe Microsoft should just re-locate to France ;-)
3. adrian midgley
MS is anything but a utility company. They sell a particualr flavour of electricity to continue the suspect analogy above - Edison's DC to the AC we ended up using for good reasons.
_Utility_ computing is where the soruce code is open, and the ingenuity, service and benefit comes from looking after the users well.
Linux and companies supporting users of it bids fair to be that, but we are not there yet.
4. Roy Foster
If Bill gets fined 3Bn$, he'll just divide that by the number of units sold in Europe and increase the European price, already hiked, by that amount. Politics, who needs politics when Money's involved; even a Sinclair calculator could do those calcs.
5. Dave Beall
Microsoft has made plenty of cash off it's proprietary monopoly. They can afford to give back a little. It's a write off for them anyway. Whats the big deal?
6. Bob Robinson
A more effective measure from Europe to Microsoft's anti competitive behavior would be for all the individual governments to insist that their own departments ceased to use products from companies that fail to obey the law. This would perhaps move them to linux and use our money more cost effectively by becoming part of that community that supports itself. Perhaps by contributing to the developement.