Microsoft Faces European Commission Deadline Today

Published: February 15, 2006

by Alex Woodie

Microsoft is facing a deadline today for complying with the European Commission's demands that the company deliver a workable plan that allows competitors to more easily write applications for the Windows Server operating system. The software giant, which is expected to formally present its remediation plan to European regulators in an oral hearing before tonight's midnight deadline, could be slapped with fines of $2.4 million per day if the EC decides Microsoft's plans don't go far enough.

Microsoft tipped its hand concerning the content of its remediation plans three weeks ago when it announced a program to share with competitors the source code for the Windows Server operating system (see "Microsoft Tries to Appease EU with Windows Server Source Code Release"). While the company announced the source-code plan to the world, it was also seeking to delay the February 15 deadline for complying with the EC's demands, which the EC declined to do. Microsoft also requested to view the EC's supporting documents, which the EC declined, citing the desire to uphold the confidentiality of Microsoft's accusers.

Microsoft is hoping that sharing the source code will get the EC off its back and bring the whole European antitrust review to a close. Prior to publicizing the source-code plan last month, the company's efforts to comply with the EC's March 2004 ruling centered on a 12,000-page document describing the so called "communications protocols" in Windows Server that are at the heart of the issue. When the consultant hired by the EC to review the document complained that it was too complex and wouldn't help programmers enough, Microsoft threw an offer of 500 hours of free technical support into the pot. Only when it became apparent the document and tech support weren't doing the trick, Microsoft laid down all its cards (in its mind) by making its source code offer.

However, it is uncertain that simply forking over the whole kit and caboodle will get Microsoft out of hot water. In its December 22 indictment of Microsoft's ongoing failure to comply with its landmark 2004 ruling against the monopoly and its competitive conduct, the EC said that "it is not necessary to reveal the source code." Despite that warning, Microsoft went ahead with plans to share the source code, while offering the explanation that there was simply nothing more thorough it could do to satisfy the EC than handing over the "DNA" of the OS.

But there is a strong possibility that competitors would actively seek to avoid viewing the source code, considering the implications it can have in terms of intellectual property rights and copyright and patent violations. There are potential legal pitfalls for third-party software developers who write applications after viewing the inner-workings of Windows, and this snake pit of uncertainty could lead software developers to shun the source code altogether. If this is the line of reasoning that the EC adopts, Microsoft could be in for some hefty fines, unless it completely capitulates to European regulators and re-writes its documentation, in super clear and concise terms.