Microsoft lashes out at European Commission

Microsoft’s top lawyer sharply criticized the European Commission Thursday, saying the organization “moves the goal post and demands another change” whenever the company tries to comply with the March 2004 anti-trust decision.

The unusually strong, five-paragraph response came from Brad Smith, Microsoft’s general counsel, about two hours after a Commission spokesman accused the company of failing to comply with its directive on workgroup server interoperability. The Commission gave Microsoft five weeks to comply or face daily fines of €2 million ($2.4 million) .

On Wednesday evening, the Commission sent Microsoft a statement of objections for allegedly failing to comply with the earlier ruling and failing to disclose complete and accurate information to allow non-Microsoft workgroup servers to achieve full interoperability with PCs and servers running the Windows operating system, said Jonathan Todd, spokesman for European Union Competition Commissioner Neelie Kroes, at a midday news conference Thursday in Brussels.

The statement is an expression of concerns and a list of recommended actions Microsoft must take to comply with the earlier ruling.

Smith wrote that the statement of objections is unjustified given the company submitted new technical documentation last week. The Commission and its trustee “by its own admission” have not read or reviewed the documents, Smith wrote. Microsoft is fully committed to complying with the Commission’s decision and has responded to more than 100 requests, he wrote.

“We’ve shipped a new version of Windows, we’ve paid an historic fine and we’ve provided unprecedented access to Microsoft technology to promote interoperability with other industry players,” Smith wrote. “Yet every time we make a change, we find that the Commission moves the goal post and demands another change.”

Smith wrote that the Commission’s latest demand is that the internal workings of Windows are documented and licensed, which the lawyer said could mean cloning of parts of the Windows operating system. The Commission, Smith wrote, “confuses disclosure of source code with disclosure of the internals and insists that it will fine the company if it fails to address this.”

Microsoft has until Jan. 25. to reply to the statement of objections. However, the fine will apply from Dec. 15 unless Microsoft comes into compliance with the decision, Todd said.

The 2004 decision requires Microsoft to document interoperability information to ensure that its competitors can develop products that interoperate with the Windows domain architecture natively supported in Windows client PC operating systems, and hence viably compete with Microsoft’s workgroup server operating system, the Commission said.

Microsoft should thus allow the use of the disclosed specifications for implementation in workgroup server operating system products. Microsoft has prepared several versions of the technical documentation since the 2004 decision, and none have complied with the requirements of that decision, the Commission said.

Smith wrote that Microsoft will pursue an oral hearing on the issue. The hearing is part of the response to the Commission’s objection. The hearing could be attended by member states and other interested parties.

The Commission is still examining the question of the royalties that licensees would have to pay for access to information about Microsoft’s server interoperability communications protocols, Todd said.

“If we have problems with it, we can issue a separate statement of objections,” he said. “The Commission’s view is that non-innovative protocols should be made available to the open-source community, but we are waiting for the ruling of the Court of First Instance.”

The Commission is also studying the application of the remedy relating to Windows Media Player. It had previously asked Microsoft to provide end users and computer manufacturers with an alternative version of its Windows XP operating system, without a bundled copy of Windows Media Player, in order to level the playing field for developers of other media player software.

Simon Taylor in Brussels contributed to this report.