EU upholds $1 billion Microsoft fine

A European Union court has upheld a roughly $1 billion fine against Microsoft that dates back to 2008. The fine will be lowered slightly, however, from 899 million Euros ($1.1 billion) to 860 million Euros ($1.07 billion).

The fine, the second-largest ever imposed by the EU, was levied in 2008 as a result of the EU's 2004 case against Microsoft's regarding access to certain APIs in its work group server operating systems that were not made available to open-source competitors from October 1988 to March 2004. The EU ruled Microsoft's actions were anti-competitive and fined Microsoft 497 million Euros in 2004. In 2006, Microsoft was fined an additional 280.5 million Euros for not complying with the ruling, and was again fined in 2008.

A statement by the European Union was issued revealing it had lowered the fine because of a letter the Commission sent to Microsoft in 2005. The letter told Microsoft it could continue to restrict distribution of certain products developed by the company's open-source competitors "on the basis of non-patented and non-inventive interoperability information" until the court issued a judgment in a then-open case. That case was later resolved in September 2007.

Because of the letter, the court lowered the fine by a small amount as the court said the letter was only relevant to "a marginal part of the effects produced by the conduct found to be unlawful." The fine in question was levied as a result of the 488 days Microsoft declined to hand over information regarding the APIs in question to open-source competitors after the original rulings.

Via: CNET News
Source: General Court of the European Union

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49 Comments

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I think it's entirely one sided that just because Microsoft is so big that they will investigate them but not Apple, who is more anti-competitive with their i devices than any other company I know of!

Kayden said,
I think it's entirely one sided that just because Microsoft is so big that they will investigate them but not Apple, who is more anti-competitive with their i devices than any other company I know of!

The difference is that Apple is not a monopoly. Microsoft is.

MindTrickz said,

The difference is that Apple is not a monopoly. Microsoft is.

Microsoft is a monopoly? That's news to me.

Stuff like this is just BS..

It's THEIR Software. Theirs. Not anyone elses.. They don't NEED to open up anything.. They don't NEED to let you be able to install, change, or access anything if they don't want to. The fact that they do is what makes them successful, but it shouldn't be Legally required.

This is as stupid at the Browser Ballot nonsense.. Microsoft should have just removed IE, and left a note on the desktop "Wanna browse the web ? Contact your EU Rep who has required us to remove that ability because they think your too stupid to know that you can download another browser if you wanted to."

I general I like the EU.. but this crap just annoys the hell our of me.

The EU sees through Microsoft's ways. Unfortunately, the US doesn't. They think MS turned over a new leaf. In fact they turned evil after Windows 7.

xpclient said,
The EU sees through Microsoft's ways. Unfortunately, the US doesn't. They think MS turned over a new leaf. In fact they turned evil after Windows 7.

they turned evil after windows 7?? how so? please do explain in full with proof.

Another thing people may be unaware of, EU only acted on this because other companies brought it up, pretty much all of them US companies, so the EU investigated as they should. I wish people would stop beating the drum that the EU is out to get companies. You wish you were so lucky in the US where companies pretty much walk over the Government.

Hang on just one second... Doesn't Apple stop developers using their private APIs for iOS and OSX from being submitted to the App Stores? Several of their own applications have had to make use of these features. Is this not the same thing as what MS did?

jbrooksuk said,
Hang on just one second... Doesn't Apple stop developers using their private APIs for iOS and OSX from being submitted to the App Stores? Several of their own applications have had to make use of these features. Is this not the same thing as what MS did?

Apple has never been and most likely will never be, a monopoly.

jamieakers said,
Apple only make up 5% of the desktop PC market, thus are not a monopoly. That's why the EU doesn't go after them...
What does the AppStore have to do with the PC market? The point he was making is relative to the mobile space, and yes Apple is guilty of the same thing, and since Apple does constitute a near monopoly margin in sectors of this market, I believe there may be grounds for a similar fine.

jamieakers said,
Apple only make up 5% of the desktop PC market, thus are not a monopoly. That's why the EU doesn't go after them...
How about the smartphone and tablet market? How much of that does Apple make up? The EU just looks the other way and caters to Apples shenanigans they pull with bs patents.

This is a total fail on the EU's part. They're just looking for a quick buck to help pull themselves out of their s***hole. At least that's how this is coming off.

Shadowzz said,

Apple has never been and most likely will never be, a monopoly.

Except for the fact that they're the highest grossing tech company?

jbrooksuk said,

Except for the fact that they're the highest grossing tech company?

And? That's dwarfed compared to the money Shell has been scooping in the past few decades.
Plus considering they build those macs for what, few 100 USD and sell them for 1-2grand easy. Plus on the iTunes market, even whatsapp costs money (its free everywhere else) and they fork in 30% of all that market money as well.

Shadowzz said,

Apple has never been and most likely will never be, a monopoly.

Maybe not in the personal computers market, but in the mobile phone and tablet market it's another matter entirely.

KCRic said,
How about the smartphone and tablet market? How much of that does Apple make up? The EU just looks the other way and caters to Apples shenanigans they pull with bs patents.

This is a total fail on the EU's part. They're just looking for a quick buck to help pull themselves out of their s***hole. At least that's how this is coming off.

And Apple has Android to compete with in mobile devices. The use of OS X compared to windows is still a nitch market. EU would be doing the same thing to apple if the situation was the same, OS X used by the entire world, and didn't want to open up it's api's.

jamieakers said,
Apple only make up 5% of the desktop PC market, thus are not a monopoly. That's why the EU doesn't go after them...

so, that shouldn't make a difference. it makes no sense to insanely fine one company for doing one thing and not fining others for doing the same thing.

KCRic said,
How about the smartphone and tablet market? How much of that does Apple make up? The EU just looks the other way and caters to Apples shenanigans they pull with bs patents.

This is a total fail on the EU's part. They're just looking for a quick buck to help pull themselves out of their s***hole. At least that's how this is coming off.

If EU was after some quick buck then wouldnt they also have fined Apple.. that only makes sense if you premise is to be believed. Anyway; EU only acted after other companies (predominantly American) reported Microsoft.

"access to certain APIs in its work group servers operating systems that were not made available to open-source competitors"

I don't get it. We're talking about Microsoft's products, through and through. Why the hell should they have to make public their APIs to competitors?

If EU is strapped for cash, go fine KFC for not revealing their 11 secret herbs and spices to the local deli and burger joints.

letmesee said,
"access to certain APIs in its work group servers operating systems that were not made available to open-source competitors"

I don't get it. We're talking about Microsoft's products, through and through. Why the hell should they have to make public their APIs to competitors?

If EU is strapped for cash, go fine KFC for not revealing their 11 secret herbs and spices to the local deli and burger joints.

I know this is a long shot, but maybe, just maybe, they have to open their APIs to competitors because they have a monopoly on Operating Systems. So, if they don't disclose APIs to competitors, they are using their monopoly position as leverage for other products.

letmesee said,
"access to certain APIs in its work group servers operating systems that were not made available to open-source competitors"

I don't get it. We're talking about Microsoft's products, through and through. Why the hell should they have to make public their APIs to competitors?

If EU is strapped for cash, go fine KFC for not revealing their 11 secret herbs and spices to the local deli and burger joints.


Because also on cooperate server side, MS is by far the largest supplier of Server OS's and the likes.
By basically being a monopoly, they get penalized and are forced to open up more of their work and in this case, their API's for others and competitors, in a way forcing MS to not become a monopoly. If MS however was Apple's size, they'd get away with it easily.

But in the EU there are different laws for companies that hold 80%+ of a market.
In Holland for example, KPN holds most of the internet connections, thus they are by law forced to supply ISRA points and connections to people with their cheapest budget contracts. Which for a measily 10 euro a month, KPN is forced to give you an ISRA point if you don't have it, these costs can be very, very high, several thousands of euro's per connection.

Also we have the NS for trains, they control most of the public train transport, hence they are forced to ride the night trains, which also costs them quite a big some of money to keep doing so (considering theres 2-3 ppl per train that costs a few thousand euro's an hour). Just because they hold the 'monopoly'.

I don't have examples from other countries, as I'm not sure about those. And considering allot of the EU law enforcement is based on the Dutch law, allot should be similar if not the same.

EU is vastly different concerning these things compared to the US. and its a good thing.
MS will lose all these charges and forced anti-monopoly laws if they become small enough again
If for example, Apple becomes MS's current size, Apple will face the same anti-monopoly and anti-thrust issues with the EU like MS is having (or had)


Thanks for the insightful post.

However, my brain just can't process it all, and here's how I read it:

When you're successful (by business' and end users' choice), you must inflict self-harm and/or provide assistance to your competitors. Otherwise, you risk a huge tax/levy/fine of up to 10% of your global (not just Europe) annual turnover.

While I see some merit to this, the "fine" itself screams "money grab". According to the CNet article, 10% of your GLOBAL annual turnover?! It's almost as ridiculous (to me, anyway) as Oracle asking for billions of dollars for the 9 line of unit test code in Android.

Edited by letmesee, Jun 27 2012, 2:41pm :

letmesee said,
Thanks for the insightful post.

However, my brain just can't process it all, and here's how I read it:

When you're successful (by business' and end users' choice), you must invoke self-harm and/or provide assistance to your competitors. Otherwise, you risk a huge tax/levy/fine of up to 10% of your global (not just Europe) annual turnover.

While I see some merit to this, the "fine" itself screams "money grab". According to the CNet article, 10% of your GLOBAL annual turnover?! It's almost as ridiculous (to me, anyway) as Oracle asking for billions of dollars for the 9 line of unit test code in Android.


might be ridiculous, but you wont hurt MS with fining them just 10.000 euro's.
Theres also a difference between being successful and fully conquering a market. MS did the latter, they knew it. They where warned. As they say here 'if you burn your bum, you have to sit on your blisters'.

Shadowzz said,

might be ridiculous, but you wont hurt MS with fining them just 10.000 euro's.
Theres also a difference between being successful and fully conquering a market. MS did the latter, they knew it. They where warned. As they say here 'if you burn your bum, you have to sit on your blisters'.

I just read the section on Wikipedia.

Not the best source of information, but it says that Microsoft:
1. agreed to provide access to their API, in exchange for royalty fees
2. lowered the fees several times because EU deemed the fees "unreasonable"
3. got as low as $10,000 or 0.4%

But EU still fined the hell out of Microsoft.

Sounds to me like Microsoft WAS trying to comply, but the judges made it near impossible to do so.

They were even quoted saying: "Talk is cheap. Flouting the rules is expensive".

I think it applies both ways. Seems to me that all the judge(s) did was repeat "unreasonable! unreasonable!". I wonder what they would've accepted as "reasonable" then? 0%?

I admit my own bias. And I think something smells fishy over at the EU.

At least the EU takes REAL action and DOES SOMETHING to at least enable someone to compete with MS. All the US Govt does is nod their heads and say "That's not fair" then do absolutely nothing about it because by the time MS lobbyists get done bribing Congress there's no political will to create real enforcement to enable a truly competitive environment.

Isn't the EU having some financial issues right now? I know Greece is for sure.

Hmm, 1.1 billion dollars could surely help a bit...

I can't help but to think of Dr. Evil when I see that number though. Ha!!

"EU's 2004 case against Microsoft's regarding access to certain APIs in its work group servers operating systems that were not made available to open-source competitors from October 1988 to March 2004."

Oh boohoo.
The EU needs to **** right off.

can anyone pretend that the EU isn't using this to prop up, no matter how slightly, their bloated socialist beaucracy

seta-san said,
can anyone pretend that the EU isn't using this to prop up, no matter how slightly, their bloated socialist beaucracy

The majority of EU funding comes from the budgets of it's constituent governments. Go learn some actual facts.

seta-san said,
can anyone pretend that the EU isn't using this to prop up, no matter how slightly, their bloated socialist beaucracy

Europe actually has consumer protection laws it enforces to protect it's citizens.

Jason Stillion said,

Europe actually has consumer protection laws it enforces to protect it's citizens.

good. now do the people have antigovernment laws that protect the citizens from out of control unelected MEPs?

Caveman-ugh said,
This is how the EU props itself up by fining company's like this for something that has nothing to do with them.
How exactly does it 'not have anything to do with them'? Who *does* it have anything to do with?

Cue loads of ignorant comments that Microsoft should just "withdraw from selling in the EU" and how "Europe is full of douchebags" and other such nonsense..

Chicane-UK said,
Cue loads of ignorant comments that Microsoft should just "withdraw from selling in the EU" and how "Europe is full of douchebags" and other such nonsense..

at least the EU does something against these things.Although if I'm not mistaken, this is part of all the nonsense Mozilla, Sun and the likes pulled off against Microsoft.

Chicane-UK said,
Cue loads of ignorant comments that Microsoft should just "withdraw from selling in the EU" and how "Europe is full of douchebags" and other such nonsense..

EU IS FULL OF DOUCHEBAGS THEY NEED TO WITHDRAW!!! oh wait.. that means me

Shadowzz said,

at least the EU does something against these things.Although if I'm not mistaken, this is part of all the nonsense Mozilla, Sun and the likes pulled off against Microsoft.

Yes, and the reason they pulled it is to defend themselves from the nonsense MS pulled off against them first. What you are saying is like Apple complaining the mobile patent wars are all Samsung's fault.