Microsoft's Antitrust Battle with the European Commission Set to Last Four to Five Years

Strategic Insights -

Microsoft Corp's antitrust battle with the European Commission will continue for another four or five years, according to the company's senior vice president and general counsel, Brad Smith. The company will appeal to the European Court of First Instance against the record 497.2m euro fine and other remedies imposed by the EC after it was found guilty of breaking European Union competition law. The EC's competition commissioner, Mario Monti, maintained that the commission had built a solid antitrust case against Microsoft that will withstand any appeal and protect the rights of European consumers.

Key Takeaways:

  • Microsoft plans to appeal to the European Court of First Instance, which will likely take four to five years, according to Brad Smith.
  • The company will ask the court to suspend at least the order to produce a second version of Windows, as well as the interface documentation order.
  • The EC has imposed a record 497.2m euro fine, which is just 1.72% of Microsoft's worldwide revenue last year.
  • The EC's remedies include requiring Microsoft to disclose interface documentation to enable non-Windows servers to interoperate with Windows-based PCs.
  • The company must also offer PC manufacturers a version of Windows without Windows Media within 90 days.
  • Microsoft believes that the settlement proposal it put forward would have provided more protection to consumers.
  • The company's intellectual property rights are being infringed by the EC remedies, which require Microsoft to put its name to a product that does not meet its own quality expectations.

Statistics:

  • The 497.2m euro fine is just 1.72% of Microsoft's worldwide revenue last year.
  • The EC has given Microsoft 120 days to disclose interface documentation.
  • The company must offer PC manufacturers a version of Windows without Windows Media within 90 days.
  • The EC has imposed a "broad compulsory license" on Microsoft.

Sources:

  • "Microsoft Corp Slams EC Ruling" by Matthew Aslett, November 24, 2003
  • "Microsoft to Appeal EC Ruling" by Matthew Aslett, November 24, 2003
  • "European Commission Ruling Against Microsoft"
  • "Microsoft Corp Slams EC Ruling"