EC settles antitrust dispute with Microsoft

EC settles antitrust dispute with Microsoft

Summary: The European Commission has accepted Microsoft's plan to offer browser choice on PCs without bundling Windows and Internet Explorer together

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TOPICS: Tech Industry
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The European Commission has settled its antitrust concerns with Microsoft, accepting the company's proposal to offer PC buyers a choice of browsing software.

The decision means the software giant's undertakings to increase browser competition are legally binding, the Commission said in a statement on Wednesday. Microsoft's proposal, announced in July, is to present users with a 'ballot screen' of browsers to install in addition to, or instead of, Microsoft Internet Explorer.

"Millions of European consumers will benefit from this decision by having a free choice about which web browser they use," said competition commissioner Neelie Kroes in the statement. "Such choice will not only serve to improve people's experience of the internet now but also act as an incentive for web browser companies to innovate and offer people better browsers in the future."

The ballot screen, which offers PC owners a choice of Firefox, Chrome, Opera and other browsers, will be available to European users of Windows XP, Windows Vista and Windows 7 for five years via Microsoft's Windows Update mechanism.

In addition, the settlement means that computer makers are now able to set competing browsers as default and to turn IE off.

The ballot screen, which the Commission began market-testing in October, is designed to address the European regulator's concerns that competition was distorted by the bundling of Internet Explorer with Windows.

This bundling offered an artificial distribution advantage not related to the merits of the product, and created artificial incentives for software developers and content providers to design their products or websites for IE, the Commission has said.

The decision, which does not rule on whether there was an infringement of antitrust law, concludes a two-year Commission investigation of Microsoft's browser practices.

Microsoft welcomed the settlement on Wednesday. "We are pleased with today's decision by the European Commission, which approves a final resolution of several longstanding competition law issues in Europe," Microsoft general counsel Brad Smith said in a statement.

"We are embarking on a path that will require significant change within Microsoft. Nevertheless, we believe that these are important steps that resolve these competition law concerns."

The software company will report regularly to the Commission, starting in six months' time, and may make adjustments to the ballot screen if the regulators request it. The Commission will review the commitments in two years.

If Microsoft were to break the deal, the European regulators may impose a fine of up to 10 percent of the company's total annual turnover, without having to prove any violation of EU antitrust rules, the Commission said.

Browser maker Opera, which urged the Commission to investigate the matter in 2007, also welcomed the decision, saying it would increase competition and compatibility between different browsers.

"This is a victory for the future of the web," said Opera chief executive Jon von Tetzchner, in a statement. "This decision is also a celebration of open web standards, as these shared guidelines are the necessary ingredients for innovation on the web."

Also on Wednesday, the Commission accepted Microsoft's proposal to disclose interoperability information for several of its key products, although the competition regulator said it is continuing its antitrust investigation on this issue.

Microsoft's requirement to provide interoperability information to competitors dates back to a 2004 antitrust ruling, which carried with it a fine of €497m (£445m). In 2008, the Commission fined Microsoft €899m for failing to comply with the 2004 ruling.

The software maker has agreed to make public an improved version of the proposals it made in July this year, related to the disclosure of interoperability information. It is also releasing documents such as a warranty agreement and a patent licence agreement.

"Under this undertaking, Microsoft will ensure that developers throughout the industry, including in the open-source community, will have access to technical documentation to assist them in building products that work well with Microsoft products," said Smith in the company's statement.

"Microsoft will also support certain industry standards in its products and fully document how these standards are supported."

While the Commission's investigation concerned with interoperability is ongoing, the body said it welcomed Microsoft's initiative.

"Even though it remains informal vis-à-vis the Commission, Microsoft’s public undertaking offers assurances to third parties that can be privately enforced," the Commission said in its statement.

"The Commission will carefully monitor the impact of this undertaking on the market and take its findings into account in the pending antitrust investigation regarding interoperability."

Topic: Tech Industry

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12 comments
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  • Why?

    This whole business seems like a complete waste of time to me. If people don't know how to install a different browser, they are unlikely to care about which one they use.
    KuleRucket
  • Mission accomplished..

    We'll now they will be presented with a choice, instead of being rail rolled into just one, so its a win if you ask me.
    CA-aba1d
  • Revealing funding

    This finding is quite revealing in my opinion in how the European Commission views the law. It has offered as its official judgment a breach in anti-trust or anti-competitive behaviour, presumably using Articles 81 and 82 EC. However, the soundbite from the article concentrates on how Microsoft has stifled innovation. This is clearly a problem with the law of intellectual property law. Somebody, somewhere, someday, will have to confront head-on how competition law and the law of intellectual property interact in such disputes, because the case law so far is too young to draw any very firm conclusions (also in my personal opinion).
    Shibley R
  • COOL KULE

    can you not see? its all about freedom and freedom to choose hence 12.000.000 people have gone away from windows/mac to linux ubuntu,you can choose what you like and its free
    anonymous
  • Correction

    I'm sorry for the typo. The title of my comment should have been "Revealing finding" not "Revealing funding"
    Shibley R
  • yup..

    This is probably more to do with which banner the powers of the EU reside under for the time being, and the anti competitive one's serves this purpose well, until the international community sort out a solid IP foundation, in which all others can then operate from.

    As you said it's all still vary early days yet.
    CA-aba1d
  • Oh please, mission accomplished my butt.

    "Mission accomplished..
    We'll now they will be presented with a choice, instead of being rail rolled into just one, so its a win if you ask me." How are you being railrollded? With Win 7 you already have the ability to completely turn off IE. You also at anytime can download and use another browser, how is that being railrolled?

    Name one other industry where the major company has to carry other companies products. Was it wrong of MS to bundle IE with their OS? I do not know, I do not think so, if so then Chrome needs to be unbundled from the Chrome OS and Safari needs to be unbundled from Mac. No linux flavor can come with a browser. That would be fair.

    I was in favor of Win7E, it did everything Opera asked them to do..."Opera requests the Commission to implement two remedies to Microsoft
    NoThomas-49dfa
  • Fair comment

    The point about comparable tie-ins/bundles affecting Google Chrome and Apple Safari are fair points in my opinion. Is it because the Courts have a prejudicial view on article 81 if they feel that article 82 has been breached? On that note, I find it hard to be believe that Apple and Google have not achieved a dominant position in their technological fields, or in time.

    I can't particularly think of why Microsoft has been singled out by the European Commission, therefore.

    Can you?
    Shibley R
  • Moin..

    "How are you being railrollded? With Win 7 you already have the ability to completely turn off IE. You also at anytime can download and use another browser, how is that being railrolled?"

    These remedies came about because of the anti trust dispute.


    "Was it wrong of MS to bundle IE with their OS? I do not know, I do not think so, if so then Chrome needs to be unbundled from the Chrome OS and Safari needs to be unbundled from Mac. No linux flavor can come with a browser. That would be fair."

    Ideally they need to come with a multiple choice.


    "MS tried to do that with Win7E, they were willing to sell the OS without a Browser so the user could choose. The EU was against that idea and so was Opera even though it was Opera's idea."

    Do you know why? How do you download a browser or much anything else if you don't have one?! that was ms being pedantic much like you are now.


    "Let me ask you this, is it not hypocritical of Google to sit in judgement of MS and telling them it was wrong of MS to release an OS with a browser, while at the same time Google releases a OS with a browser? Is not google railroading me by sticking me with Chrome on their ChromeOS?"

    I guess they are I know some people who might be able to help you out there.


    "A win would of been Win7E, that would be the only fair way for everyone concerned."

    It would have being the biggest conundrum on the planet.
    CA-aba1d
  • Sorry for the delay in answering, I moved..

    ""How are you being railrollded? With Win 7 you already have the ability to completely turn off IE. You also at anytime can download and use another browser, how is that being railrolled?" These remedies came about because of the anti trust dispute." Really how so?? MS announced long ago that is was unbundling alot of stuff because of how cumbersome it was for writing code with everything tied together. They announced that before the EU case, maybe they saw the EU case coming and decided to do it or maybe they were honest and it was hard to continue to write code with everything tied together, in which ever case it was before the antitrust dispute.

    ""Was it wrong of MS to bundle IE with their OS? I do not know, I do not think so, if so then Chrome needs to be unbundled from the Chrome OS and Safari needs to be unbundled from Mac. No linux flavor can come with a browser. That would be fair." Ideally they need to come with a multiple choice" Really, tell me in what other industry does the market leader have to carry the competitors products and give them the choice?

    ""MS tried to do that with Win7E, they were willing to sell the OS without a Browser so the user could choose. The EU was against that idea and so was Opera even though it was Opera's idea." Do you know why? How do you download a browser or much anything else if you don't have one?! that was ms being pedantic much like you are now." No, it was MS trying to head off a judgement against them, they did exactly what Opera asked them to do. How is that wrong?? How would one get a browser if no browser came included you ask? Simple do the same thing they did before you went and picked up a disk. The First version of Win95 did not come with a browser and I browsed the internet ok. Each browser should come on a disk and the user would pick one up when he either purchased a new PC or when he purchased the OS.

    "A win would of been Win7E, that would be the only fair way for everyone concerned." It would have being the biggest conundrum on the planet." Maybe but it would of been fair and even so MS did what Opera asked of it so MS would not be ruled against. Opera was dumb to suggest it to begin with, MS was not wrong for saying ok if it meant not being ruled against.

    btw its still Christmas day here and I wanted to tell you I hope you are having or had a happy holiday!
    NoThomas-49dfa
  • Sure I can

    "I can't particularly think of why Microsoft has been singled out by the European Commission, therefore.

    Can you?"

    Its a American company

    2nd they have not always played fair, I acknowledged that. They have deserved some of what they have gotten but the biggest argument I hear is about fairness, How is it fair to make one company do it but not all the others?
    NoThomas-49dfa
  • bit late in the day but after 7/8 years of saying [repeatedly] it always seems to be a prob., with microsoft? funny that ain,t it[IT]
    anonymous