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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: Funny
By karielash on 7/9/2008 10:03:19 AM , Rating: -1
'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.” '

Read the link before you quote, the validity of that information is at best questionable (the source is actually Microsoft), so the experts you so proudly trumpet are..... Microsoft.

MS were told repeatedly to put their house in order and failed to do so, MS represented and stated their case AT EVERY hearing and every time they were deemed to be spouting rubbish.

Fact is Microsoft make a product and abused that products popularity to ensure it would be extremely difficult for competitors to compete in multiple markets.

As for free markets, do not make me laugh, the USA is the home of protectionism and wouldn't know what a free market was if it was printed on the back of a greenback.

RE: Funny
By baseball43v3r on 7/9/2008 1:59:29 PM , Rating: 4
protectionism? no free market? are you insane? then explain why we pretty much import EVERYTHING nowadays. our economy is in the crapper right now because of the free economy because we have the minimum wage and countries like India and China really...dont. but your right, we dont have a free market. We only lose jobs to foriegn countries every day because our country has the free economy. As to the home of protectionism, i can think of quite a few countries, some most notably in the actual EU that are far far far worse then the US in terms of that.

The experts come from PriceWaterhouseCoopers so that is at worst reasonable, just because the link comes from Microsoft doesnt mean the information they tout isnt verifiably true. They were told to put their house in order but not exactly what that meant, so how could they do so under sucha vague premise? of course the EU would say they are spouting rubbish do you honestly think MS can win this after the EU wants that much money from them? its not like the EU is a holy santic body who does no wrong, they are just a money grubbing organization going after the fat little piggy for the bacon.

"Nowadays, security guys break the Mac every single day. Every single day, they come out with a total exploit, your machine can be taken over totally. I dare anybody to do that once a month on the Windows machine." -- Bill Gates
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