European Union accuses Microsoft of antitrust violations

Microsoft said yesterday that it has received a Statement of Objections from the Directorate General for Competition of the European Commission(EC). This is not the first time the EC has objected Microsoft business practices and its been going on since 2005. Microsoft was fined more than $1 billion in the past by EC after determining that Microsoft isn't living up to the terms of a 2004 antitrust settlement.

Below is the statement published by Microsoft:

MICROSOFT STATEMENT ON EUROPEAN COMMISSION STATEMENT OF OBJECTIONS
January 16, 2009

Yesterday Microsoft received a Statement of Objections from the Directorate General for Competition of the European Commission. The Statement of Objections expresses the Commission's preliminary view that the inclusion of Internet Explorer in Windows since 1996 has violated European competition law. According to the Statement of Objections, other browsers are foreclosed from competing because Windows includes Internet Explorer. The Statement of Objections states that the remedies put in place by the U.S. courts in 2002 following antitrust proceedings in Washington, D.C. do not make the inclusion of Internet Explorer in Windows lawful under European Union law.

We are committed to conducting our business in full compliance with European law. We are studying the Statement of Objections now. Under European competition law procedure, Microsoft will be afforded an opportunity to respond in writing to this Statement of Objections within about two months. The company is also afforded an opportunity to request a hearing, which would take place after the submission of this response. Under EU procedure, the European Commission will not make a final determination until after it receives and assesses Microsoft's response and conducts the hearing, should Microsoft request one.
-- Microsoft Corporation

This looks like it is based on the complaint filed by Opera to EC which is aimed at giving consumers a genuine choice of Web browsers. It condemns Microsoft for bundling Internet Explorer with Windows and not allowing to bundle other web browsers with Windows. The complaint also urges Microsoft to follow fundamental and open Web standards accepted by the Web-authoring communities.

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waruikoohii said,
Oh, they do fight. Butwhen the fines are paying the judges salaries, do you really expect the EU to let MS off the hook? As strange as it sounds, MS is helpless with this. The EU is essentially a bully stealing kids' lunch money.

Surely that's like saying the US Supreme Court makes decisions based on the government paying them their salary? Rather doubtful.

I'm not a fan boy of either MS or Apple but the EU is really ****ing me off. Treat Apple and Microsoft equal, or better yet **** off and go find some other way of getting money.

James812 said,
I'm not a fan boy of either MS or Apple but the EU is really ****ing me off. Treat Apple and Microsoft equal, or better yet **** off and go find some other way of getting money.

I hope you're not an economics or law major either.

I guess it comes down the how much money they make in the European union versus the fines they're being hit with. I suppose Microsoft works out which is more cost effective and goes with that.

The large issue is the Microsoft does not (despite opinion) have an endless supply of money, and eventually they will run out, especially if they're being hit with extremely large fines with the global economy the way it is.

I personally do not use internet explorer (other then to test for web designing) but as many people have said a operating system without a web browser is useless!

I guess the question must be asked, does Microsoft stop OEM companies from including other browsers within the system for fresh installs?

Because if not, why not just installed Firefox, opera or chrome onto the system, set it as the default browser for the operating system and away it goes.

The other side of course, is this will lose market share for IE which is bad for Microsoft and will also make web designers lives harder. The amount of browsers based on different standards already makes massive headaches for us.

I do not believe apple is a monopoly (perhaps in iTunes but not OS) but i can't stand it when people tell me 'ohh Mac has everything i need when i turn it on' the issue is Microsoft would too if it was allowed!

Perhaps Microsoft could have their own brand PC and start doing the same thing? ohh that's right.. Microsoft is a big company, so that's not allowed.

I don't understand how it is said that OS X operates in the same market space as windows. I'm sure Apple prohibit me from running OSX on my pc. I had to buy a very expensive iMac to get that software.

I'm all for software being bundled as it improves the Out of the Box Experience. I don't wanna spend ages adding all the programs needed to just get started on a computer. I want to just be able to turn it on, browse the net, maybe play a media file, much like I can right now with windows or my Mac. Things like this make me glad I moved out of the EU

-T- said,
I don't understand how it is said that OS X operates in the same market space as windows. I'm sure Apple prohibit me from running OSX on my pc. I had to buy a very expensive iMac to get that software.

I'm all for software being bundled as it improves the Out of the Box Experience. I don't wanna spend ages adding all the programs needed to just get started on a computer. I want to just be able to turn it on, browse the net, maybe play a media file, much like I can right now with windows or my Mac. Things like this make me glad I moved out of the EU


Look up what a relevant market is. OS X or Macs are considered to be a substitute or an interchangeable product, no matter what it costs for you to get. (that being the iMac)

giga said,
Look up what a relevant market is. OS X or Macs are considered to be a substitute or an interchangeable product, no matter what it costs for you to get. (that being the iMac)

Yes, and the Psystar case is especially useful in highlighting this. At least it's the most recent one that has considered the issue with respect to Apple specifically.

giga said,

Look up what a relevant market is. OS X or Macs are considered to be a substitute or an interchangeable product, no matter what it costs for you to get. (that being the iMac)


Which is why people are so p*ssed off about it. OS X is NOT a subsitute for Windows on the basis that it costs more and you are then restricted to their hardware.

But as a "subsitute product" they are allowed to bundle their browser with the platform?

Legal definitions aside, this is downright stupid. The fact that our/your legal framework is unable to cope with these issues doesn't make the fact that Apple throw their browser in with their OS any more "right" than Microsoft.

stevehoot said,

Which is why people are so p*ssed off about it. OS X is NOT a subsitute for Windows on the basis that it costs more and you are then restricted to their hardware.

But as a "subsitute product" they are allowed to bundle their browser with the platform?

Legal definitions aside, this is downright stupid. The fact that our/your legal framework is unable to cope with these issues doesn't make the fact that Apple throw their browser in with their OS any more "right" than Microsoft.


It IS a substitute on the basis that it mimics the use of the product it competes against. OS X is an indirect substitute of Windows--it competes with other oem and third party vendors such as Dell, Acer, etc.

And is Apple in trouble for "forcing" Safari being pre-installed (and the default browser) on OS X? NO SIR! I guess only Microsoft has pockets deep enough to satisfy the EU's greed.

This issue has long since died. The EU needs to find a different revenue stream.

Microsoft is NOT the reason why very few people want Opera installed on their computer and this is about the lowest, least-creative, least-effort method of changing that. Try copying Microsoft. As in, INNOVATE something.

@ LTD - I will agree Apple so far has not been convicted as a monopoly, but Apple like all company has had some questionable business practices. I am writing this on a MacBook, i earn my living supporting Microsoft products so i am not biased in either direction. I do personally feel with my Iphone and Mac hardware that i have to constantly refer to apple for support and whilst this is a good service generally i feel this indicates that the mac OS X eco system is heavily in favor of apple, as is Microsoft's. I as an englishman feel deeply embarrassed that this matter has come to light due to the ignorance of the EU money grabbing squad. but i will ask you this if Microsoft are being investigated again for this, how much longer til apple is investigated for Iphone Exclusive network contracts, Itunes and Ipod being lock into an eco system that allows for no competition and finally pushing a web browser on a update service that was originally used to update a media player (itunes) and this is on the windows platform. it think all companies are in it to make money, but i do feel Microsoft are being penalized for doing what apple and many others are doing and have been doing for many years.

blah blah blah, lets start with removing the games, removing calc, notepad, ms paint, sound recorder, etc.

if they remove IE, how am i going to go online and download any other browser? there was too much to read above to see if anyone answered my question, and i dont have the time at this exact moment.

thats exactly what i was thinking.

lets remove IE from windows installations, and lets remove ftp funtionality.
so where do you get your browser from now huh? :D

maybe MS should implement wget into windows :D

next move: lets sue all OEMs for bundling their software. some of them preload their pcs with firefox! what about that?

This is obviously an attempt from the EU to soak up more funds from Microsoft.

I am platform agonistic. I love MacOS X (i use it primilary at home) I love Windows (Which is use at work) and i love Linux which is use on servers with windows.

IE 5 and 6 were crap in my opinion, these browsers destroyed standards and made many websites IE only. The major banks were guilty of this, it took ages for Barclays etc to be compatible with any browser.

However that was 6 years ago, this is now 2009. We have IE7 and IE8 on the way which both adere to web standards, i don't think i have ever come across a public web site which doesn't work on all browsers. Microsoft learnt their mistake and made their browsers better.

Again we are in 2009, to sell an OS without the ability to, Surf the Web, Check Emails, To play music and do basic text file / word processing is ludicrous. Users need to be able to walk into a shop and purchase a computer which can do those things. Yes OEM could install their own, however some won't and every PC sold will come with a different array of Software.

Opera is only complaining because their market share is diminishing, IE, Firefox and Safari are leading the pack, due to features and user preference, if Opera want to increase their share they are gonna have to innovate and draw new users as Firefox has done successfully.

I appreciate some of the EU laws as it helps us to have a healthy market, however i can't think of anyway this is going to help end users, i think this is going to be a disaster and i hope Microsoft is able to stand up to them not only to stop them becoming the personal piggy bank of the EU but to also stand up for users who want to buy computers knowing they can use them in a modern world.

Pandya said,
Just a practical point without even touching upon the ethics or legalities of the issue. But an internet browser HAS to be included by default as part of the operating system on a new install or a new computer. Otherwise the average user has no method of installing an alternative internet browser. Sure, it could be done on windows from the command line with the ftp client if the user had sufficient knowledge and knew the location of Firefox/Opera by ftp, or by USB stick from another computer, or even a somewhat old fashioned optical disk, but Internet browsers are not readily available and distributed on optical disks. Therefore some basic method of accessing the internet must be included, if only as a bootstrap for the user to install their own. Unless you want to suggest Microsoft should include software from their competitors as part of a default install. Because that would be somewhat ridiculous.


The argument for the average user here is somewhat mute, since most "average" users would purchase a pre-built machine, whereupon the OEM would provide an installed browser as part of the build.

I am actually all for windows being further modularised as per the windows live essentials approach, that said if windows were to ship sans-browser this would leave me with having to source a browser when installing a clean build from my OEM copy of windows - obvsiouly forcing more thought into the process.

I appear to be in the minority where I still prefer IE to the various other offerings, stability issues asside I really like the progress being made with IE8 a vast improvement on the days of IE6 and below.

Wow, I ... really don't have words... why don't they just give up. Microsoft should move all their activity to some tax paradise where no-one can touch them

This really comes down to money, MS has is and the EU wants it. Microsoft has made changes, and members of the EU don't care, they see money and are going to go for it. Microsoft is not a monopoly because they made us to it, they are because they had the best product. There will always be monopolies, and there is no reason to punish them, except to line your own pocket with cash.

MS made changes and gave us the Set Default program, any additional changes are unwarranted and should be fully challenged, and maybe this time the US government will step in and protect one of our own, If not, MS under Balmer may tell some countries or groups to **** off.

I believe people is missing the issue, because IE comes pre-installed on the computer and its called "Internet Explorer" the average people will think this is the only way to access websites and will not search or think about other options. I not should what Microsoft should do about the issue but this is monopoly issue and EU was right to step in.

Gerry said,
I believe people is missing the issue, because IE comes pre-installed on the computer and its called "Internet Explorer" the average people will think this is the only way to access websites and will not search or think about other options. I not should what Microsoft should do about the issue but this is monopoly issue and EU was right to step in.


If people are that dumb, let them use MACs. I mean give me a break, this is honestly about money nothing else. The benifit is about money, and control, not helping others.

STability? Security? My IE8 experience with windows 7 has converted me back to IE after having played with both firefox and chrome. Theres choice and alot of it in the browser market. The EU is being stupid in the matter in my opinion.

So the EU are short of cash.

Ohh so can I fine M$ for something when I am short of cash?

It's me and other registered users of M$ products that will foot the bull not M$.

They just raise the retail costs.

Thanks a bunch EU, M$ has produced billions and billions of revenue and jobs by just being.

I'm glad you have such an informed understanding of the subject matter... oh wait, no you don't. Competition laws exist to protect the consumer. If Microsoft destroys the competition through unfair business practices then prices can be raised and innovation can take a back seat. The reality is that Microsoft has to abide the laws of the countries in which it operates - the implication here is that Microsoft has not, though this is not the final ruling.

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