Microsoft loses EU Appeal

The European Union might have just done what the US could not,
humbled the Giant from Redmond. In a landmark judgment on September 17, 2007,
the European Court of First Instance upheld the decision of the European
Commission that had imposed a fine of Euro 497 mn ($690m) on Microsoft.

A probe concluded in 2004 by the European Commission had found
Microsoft guilty of freezing out rivals in server software and products such as
media players. As part of that, Microsoft had been ordered to offer a version of
its Windows operating system without Microsoft's own media player, and also told
to give rivals more information about how its OS, Windows works.

Microsoft had appealed against the judgment, terming it unfair.
Microsoft had argued that adhering to the ruling would hurt its business.
According to the company, the European Commission is forcing the firm to give up
valuable trade secrets, a move that would handicap its future and hurt
innovation in general.

The ruling upheld that 2004 order, saying it was "beyond
dispute" that Microsoft had coerced customers to buy its Media Player
software along with the operating system. In fact, last year, Microsoft was told
to pay daily fines adding up to Euro 280.5 mn over a six-month period, after it
failed to adhere to the 2004 decision.

It was in 2000 that a US Federal judge ruled that Microsoft had
abused its market dominance and should be broken up. But somehow the thing
fizzled out, as on Microsofts appeal much of the original ruling and sentence
were thrown out (though it was still found guilty of monopolistic behavior).
Will the latest decision impact the company, or dissipate like the earlier
ruling. Microsoft has two months to appeal at the European Court of Justice.

The judgment has the potential of opening the Pandoras box,
as based on the ruling a lot many companies could come under the scanner.
Sometime back, Apple had faced fire in French courts over iTunes DRM. The very
complaints lodged against Microsoft could be easily used against the Google and
Apple. But for now, Microsoft is surely numbed.

Shashwat DC

shashwatc@cybermedia.co.in