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Eu may fine microsoft { November 12 2003 } Original Source Link: (May no longer be active)
http://www.reuters.co.uk/newsArticle.jhtml?type=technologyNews&storyID=3808167§ion=newshttp://www.reuters.co.uk/newsArticle.jhtml?type=technologyNews&storyID=3808167§ion=news
Microsoft Clashes with EU Regulators
Wed 12 November, 2003 20:12
By David Lawsky and David Milliken
BRUSSELS (Reuters) - Software giant Microsoft clashed with European regulators on Wednesday, hitting back at charges it acted unfairly to increase its share of the market for software to run simple computer networks.
After facing antitrust probes in the United States, the company which made founder Bill Gates a billionaire is threatened with fines by EU competition chief Mario Monti.
Monti could also order Microsoft to change its ubiquitous Windows software in response to charges -- to be addressed on Thursday -- that Microsoft is squeezing out rivals who make software which plays music and video on the Web.
On the first day of a three-day closed-door hearing, the European Commission charged that Windows was designed to work better with Microsoft's own low-end network software than its rivals' products, sources familiar with the case said.
One of the Commission's publicly stated goals is to ensure other producers' server software can work with desktop computers running Windows as easily as Microsoft's.
It has accused Microsoft of abusing its dominant market position in desktop computers through Windows.
SERVER SHARE
But while Microsoft's share of the low-end server software market has increased since the EU's investigation started five years ago, the firm has denied anti-competitive practices are to blame.
"Microsoft's behavior has in no way limited its competitors' ability to interoperate with the Windows server operating system," the company said in a recent statement.
Microsoft argued during the hearing that sufficient ways exist for others to connect to the Windows desktop, but that it had pulled ahead of competitors such as Novell because its products were more versatile, sources said.
"During our time today, Microsoft's technical and economic experts presented information on server operating systems and multimedia playback technologies," Microsoft said in a statement after the conclusion of the first day of hearings.
Critics say Microsoft stopped giving Novell essential help to link its software to Windows once it decided to enter the server market itself.
"It's a given that Microsoft targeted the Novell market," said Jonathan Zuck, head of the Microsoft-backed Association for Competitive Technology.
Zuck added the Commission had too narrow a definition of the server market and on broader definitions Microsoft does not dominate the server market.
The Commission, in its most recent arguments, has only considered software running on servers which cost less than $25,000. Microsoft said the market should be defined on the software used, not the system it is run on, sources said.
MONOPOLY PLAY
The day had a colorful start when one lawyer accused Microsoft of shrugging off the severity of monopoly abuse.
Michael Hausfeld, who has brought U.S. class actions against Microsoft on behalf of consumers, said he will show a videotaped deposition of Microsoft Chief Executive Steve Ballmer to illustrate the company's culture.
"We asked him -- this is after Microsoft has undergone four investigations and one trial (on) two continents -- if he has any understanding of the word monopoly," Hausfeld, who practices in Washington, D.C., told reporters as he entered the building:
"He actually laughed and said, 'Yes, I play it with my children'," Hausfeld said. "I don't think that's an indication of someone who takes his obligations seriously."
Microsoft spokesman Jim Desler responded: "Much of what is said by partisans about this proceeding should be treated with great skepticism, particularly when they use comments out of context."
At the same time the hearings are taking place, Microsoft is still talking to the Commission to reach a compromise.
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