EC Planning to Fine Microsoft: Reports

Published: June 28, 2006

by Alex Woodie

The European Commission is nearing its decision on whether or not Microsoft abided by the landmark 2004 antitrust ruling, according to published reports. Several news organization, citing anonymous sources, have reported that European regulators have drafted a ruling that finds Microsoft has failed to fully abide by the 2004 ruling. The reports say the EC is planning to propose a new ruling and a new fine against Microsoft on Monday, and that a final decision could come as early as July 12.

For the last six months, Microsoft has been fighting a December ruling by the EC that found the software giant was not abiding by its 2004 ruling that requires it to help competitors write applications that interoperate with the Windows operating system and its networking protocols. If that ruling is upheld, Microsoft could be subject to fines of €2 million per day, or about $2.5 million. These fines would be retroactive to the date of the EC's December ruling, bringing the total to more than $500 million.

The central issue revolves around the actions Microsoft has taken to help competitors, including IBM, Sun Microsystems, Novell, and others, write applications that work well with Microsoft's server operating system. The EC says Microsoft's initial response to the 2004 ruling, a 12,000-page report that discusses communications protocols, was so poorly written as to be almost useless. The software giant also offered thousands of hours of technical services to its competitors. Microsoft even went so far as to offer the source code to Windows Server to settle the matter--an offer that Microsoft's competitors have scorned as a "poison honeypot."