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Software giant balks at penalties

The European Union appears set to keep its hard-line stance against Microsoft’s allegedly anticompetitive tactics, and it is insisting on imposing a €899 million ($1.36 billion USD) fine on the company to keep its future actions in line.

Microsoft’s lawyers disagree, however, and entered a variety of arguments last May that the fine is too high, and was entered based upon “manifest errors” in the EU’s process. With copies of the arguments released publicly earlier this week (PDF), its demands to annul the fine are now available for perusal worldwide:

  • The EU “erred” in its decision to subject Microsoft to regular, periodic fines while the company released copies of its interoperability specifications, due to the fact that Microsoft’s pricing for the documentations was not in line with the EU’s definition of “reasonable,” – the EU never explicitly stated what it considered a “reasonable” price to be.
  • Further, licensing rates for information on its proprietary protocols – despite not passing the EU’s benchmark of reasonability – were more than 30 percent lower what industry experts PriceWaterhouseCoopers determined to be a fair price for “comparable technology.” (Ars Technica questioned this finding early last year, noting that in many cases ‘comparable technology’ was open source, and therefore free.)
  • Microsoft should not have been subjected to a “heightened patentability test,” where the innovation of its trade secrets was placed under scrutiny in order for the EU to decide whether or not Microsoft should have charged royalties for the use of its trade secrets.
  • The EU based some its assessment reports on documents obtained that courts later determined to be “unlawful.”
  • Microsoft was denied its “right” to be heard due to the EU’s failing to give Microsoft the opportunity to speak up after the period for which it was fined, preventing the company from “commenting on all relevant aspects of the case.”
  • And, simply, the fines imposed are “excessive and disproportionate,” particularly due to the fact that the EU chose to challenge its licensing practices.

Additionally, Microsoft previously appealed the fine to Europe’s Court of First Instance last May – however little has developed in the appeal since its filing.

The company’s trouble began in 2004 when the EU demanded Microsoft provide competitors the ability to connect to software running under its Windows platform (applications like Exchange and Active Directory). Third-party attempts to connect to Microsoft technologies have, typically, been written by reverse engineering the company’s communications protocols.



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RE: Fight and win
By RandallMoore on 7/9/2008 8:19:20 AM , Rating: 2
Im not sure you realize just how much of the material world runs off of MS software... Before anyone says it, YES i do understand that there are ALOT of servers out there that run UNIX and linux. But seriously, linux is garbage when it comes to serious business productivity. Its sometimes nice for IT pros i.e. programer, web design, network admins, etc etc. As a whole though, the world revolves around MS and they know it.


RE: Fight and win
By Amiga500 on 7/9/2008 8:32:35 AM , Rating: 3
As a whole though, the world revolves around MS and they know it.

Yeap - thats kinda my point.

If people **had** to find alternatives, then MS's position with regards compatibility, reputation, penetration & support is all under severe scrutiny.

There are alternatives to windows and MS software - its just that businesses & home users like to know things will run on their machine. If MS loses that stranglehold, they lose a lot of the reason people buy windows in the first place.


RE: Fight and win
By crimson117 on 7/9/2008 11:56:28 AM , Rating: 2
Define "serious business productivity" ...


RE: Fight and win
By mindless1 on 7/10/2008 11:06:57 AM , Rating: 2
I hateo to break it to you, but EU doesn't matter, nor does America. If China and India cultivate an adoption of 'nix then things will change quite a bit in the next 10 years. Yes, it'll take years, just as MS didn't get this popular overnight they won't fold from a few billions in fines or losses of fractional markets.

Linux is great for serious business productivity. Maybe you meant home use instead? Typical business systems are locked down, fixed application base, almost ideal for linux except for a need for more high quality administrators that know how to support it and still do the hand-holding at the same time since most linux admins seem to pretty much hate average joe users.

Think about what the typical office machine does. Email? Check. Browser? Check. Office? Check. Of course there are going to be certain mission critical applications that only support certain OS, and those certain OS are most likely to be in the Windows NT family if recently released but what made windows what it is? A lot of momentum by the industry, not by MS. Widescale adoption, just like you could see in India and China.

Linux has already evolved beyond what Win9x was with exception of a few usability features. An OS with minimal commercial development for the PC sector has eclipsed what MS had accomplished during Win9x era with millions of dollars pouring into it regularly. There's no denying a future where it becomes cheaper to do the everyday things that people need to do with PCs and MS doesn't understand that as shown by an ever increasing hardware base on Vista just to do those things. What did the world need? A fixed interface, not changes like with Vista, so there was no retraining to do the same things. What else? More security, to decrease user burden not increase it like Vista does with the nagging or deactivation of certain OS components. What else? Lower footprint and computational demands than XP, not higher - because low power light weight cheaper greener systems are in our future.

MS really doesn't get it. Everything and the kitchen sink is definitely a geek's delight but most of the world are not computer geeks.


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