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Europe charges Microsoft with abuse of monopoly again

By Paul Meller, IDG News Service
January 17, 2009 10:30 AM ET

IDG News Service - Microsoft was formally charged with monopoly abuse by Europe's top antitrust authority, the European Commission, over the way it bundles the Internet Explorer browser with Windows.

The move follows an unsuccessful attempt by U.S. authorities nine years ago to strip Internet Explorer (IE) of its unfair advantage over competing browsers. European authorities were more successful in their prosecution of Microsoft over similar antitrust offenses five years ago, fining the company over €1.6 billion and ordering it to change the way it does business.

The Commission's charges were delivered to Microsoft's headquarters in Redmond, Washington, last Thursday in the form of a formal statement of objections. The company is studying the charges and will respond within the next two months, as is usual in European antitrust cases, it said.

The new charges are the first of many anticipated against the company in the wake of a failed court appeal by Microsoft last year against the original European antitrust ruling.

The latest statement of objections follows a relatively short investigation, one year long, sparked by a complaint from Opera Software, a Norwegian browser developer.

Opera CEO Jon von Tetzchner welcomed the Commission's decision to press charges. "It's clear they are taking this very seriously," he said in a phone interview on Saturday.

However, he still doesn't know if the Commission pursued both aspects of his company's complaint against Microsoft: In addition to complaining about the bundling of IE into Windows, Opera also pointed out that the software giant was undermining open software standards on the Internet.

"Its a problem for companies like ours if Microsoft doesn't support the open standards we all apply, because many Web sites are designed to work with IE, which means our browsers won't always work out of the box," he said.

IE is still the most widely used internet browser, although its market share dipped below 70 percent globally in 2008, according to Web analytics company Net Applications. In December, Opera's share was around 0.71 percent.

Von Tetzchner said he hopes the Commission doesn't apply the same remedy it did in its last ruling, when it ordered Microsoft to offer a second version of Windows alongside the regular version of the software, but without a bundled copy of Windows Media Player .

Microsoft complied with the ruling but no one bought the unbundled version, which was sold for the same price as the version with Windows Media Player included.

"That's not really what we are looking for as a remedy for the bundling of IE," von Tetzchner said, adding: "The only way to give users a genuine choice is to strip out IE from Windows and either replace it with a rival browser or offer users a list of browsers to choose from."

The latest antitrust charges against Microsoft almost certainly won't be the last.

At the same time it opened the investigation into the bundling of IE, the Commission also opened a separate probe to see whether Microsoft withholds information from companies that want to make products compatible with its Microsoft Office productivity suite.

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