EU rules on Microsoft antitrust appeal: Bad news for Microsoft

The 15-month deliberation into Microsoft's appeal to the European ruling in their anti-trust case is over. The news is pretty bad for Microsoft as their appeal has been dismissed. As such, the $688 million fine imposed in 2004 stands and Microsoft must pay 80% of the Commission's legal costs as additional insult. Microsoft did succeed at abolishing the independent monitoring trustee established to supervise Microsoft's behavior. Microsoft can still appeal to the highest court in Europe so this isn't over by any stretch of the imagination.

[shakman @ Sep 17th 2007 3:43AM]

All over $688 fine?
How much has been spent on legal fees?
The interest on the legal fees over 15 months would probably cover the fine... maybe I'm missing a piece of the puzzle here but can someone please help me understand this?

[jixbon @ Sep 17th 2007 3:43AM]

I think they probably meant to say $688 million.

[Scooter @ Sep 17th 2007 3:44AM]

multiply that by 1,000,000 and you'll be closer to an accurate figure. Hopefully Thomas will rub the sleep out of his eyes and correct it soon.

[shakman @ Sep 17th 2007 3:46AM]

Okay, now that makes more sense... updated to $688 million.
Bill will have to look under a few lounge cushions to find that...

[L. Cyphre @ Sep 17th 2007 3:43AM]

Finally.
Also, In Before lol Europe.

[Duderdude2 @ Sep 17th 2007 3:44AM]

$688 fine? Why that's not bad at all! ;)

[Ben Grimsbo @ Sep 17th 2007 5:17AM]

At $688 you can't afford NOT to get charged with antitrust :D

[goodluck @ Sep 17th 2007 3:46AM]

did engadget forget to mention it was over 600 million rather then just 600?

[heyguy @ Sep 17th 2007 4:15AM]

Where does that money go?

[L. Cyphre @ Sep 17th 2007 4:22AM]

*Puts on shades*
Why do you want to know?

[blarvh @ Sep 17th 2007 9:39AM]

It goes to farmers in Bulgaria.
And to cover travel expenses for school kids like me to do exchange programs, yey!

[Ian @ Sep 17th 2007 12:03PM]

The money is used by he EU to prop up their socialist aspirations at the expense of foreign corporations. Apple is next. EU gotta eat! After all it's all about "fair competition" like the kind Airbus enjoys with billions in EU cash handouts to keep their bloated company afloat.

So, as I sit here typing this in FireFox on Linux I will whine about how MS makes me run their stuff. Oh wait, they don't.

So you see, this has nothing to do with competition other than MS has incomptent competitors and they have to whine to the EU for hand-outs.

[E71 @ Sep 17th 2007 7:17PM]

Well I'm certainly hoping Microsoft fines the EU for a billion, for wasting their time and questioning their superiority!

[Firn @ Sep 17th 2007 4:32AM]

Actually, the court has only ruled about the first of two fines which is "only" $497 million. The second dispute for the remaining fine will be ruled on later this year.

It's two different isues - the first (which today is ruled about) talked about offering a free mediaplayer built in the OS being unfair towards competitors like Real; the second which will be ruled about later is initially about a complaint from Sun about reveiling standards on Microsofts servers to make connectability for competing alternatives easier.

[scott @ Sep 17th 2007 7:16AM]

Firn - the ruling today covers both WMP and the server protocols - there isn't separate cases for both. I presume you are confusing this with the additional fine of EUR 280.5 million Microsoft received for its failure to comply with the requirement, in the 2004 antitrust decision, to provide complete and accurate interface specifications, so as to allow other companies to make their products interoperable with Microsoft PCs and servers.

[Firn @ Sep 17th 2007 7:27AM]

Ah, indeed - thank you for the clarification then!

[needlegun @ Sep 17th 2007 4:36AM]

Ha ha, this is the pot calling the kettle black!

European Commission & corruption go hand in hand. No less than seven high ranking individuals being 'dismissed' in the last 12 months after investigation by the Audit Committee, and that was just the ones dumb enough to get caught!

Sure, Microsoft isn't whiter than white by any stretch of the imagination, but one thing is for sure - if Microsoft do have to pay up then you can guarantee that $690 million will NOT be going to the needy in Europe!

[LordFarkward @ Sep 17th 2007 5:18AM]

wow, seems like you're just throwing stuff out there to make yourself look/sound smart when you don't even make much sense...

1) "pot calling kettle black"? one is to do with corruption and the other is to do with antitrust (look it up, mate), they're quite different.

2) and even if they're 'the same thing', doesn't the fact that the audit committee 'investigated' and caught them out shows the fact that they ARE against 'such crimes' and they will do something to stop it?

[needlegun @ Sep 17th 2007 4:27PM]

Hmmm, so one 'less than wholesome' organization pursuing another 'less than wholesome' organization isn't a case of "the pot calling the kettle black" because you want to split the differences between the dictionary definitions of corruption and anti-trust.

Now who's trying to look clever?

Perhaps you should read and try to understand the comment. It is the European Commission who are prosecuting Microsoft. The European Audit Committee is a separate and independant body who are prosecuting European Commission officials, so remind me again - who are the ones in this equation who are without guilt? The irony of an organization prosecuting another when they themselves are (repeatedly and successfully) being prosecuted is obviously lost on you.

[ILOVEBLENDTEC @ Sep 18th 2007 2:58AM]

ooooo the second guy got OWNED...

and the winner by way of technical mumbo jumbo knockout.....

NEEDLEGUN!!!

*philosophy books start raining down from the heavens*

[MacGuru @ Sep 21st 2007 12:01PM]

Please stop speaking about things you very clearly know nothing about.

[Xavier Gill @ Sep 17th 2007 4:38AM]

I'm glad Europe has the balls to stand up to Microsoft and other big business

[Simon @ Sep 17th 2007 4:54AM]

Amen.

[iczer2 @ Sep 17th 2007 8:26AM]

Right, and let's see how vigorously they go after European corporations.

[SW @ Sep 17th 2007 9:02AM]

They already do; there has been lots of European companies getting fines for similar misconduct. And the fines have been higher, up to 10% of annual global reveune, which for MS would have equalled $5 billions.

[Rik @ Sep 17th 2007 11:03AM]

@iczer

Let's see about those EU companies...

- 279 milion euros fine for four beer brewers (all Dutch btw..., I want my money back!)
- 216.91 milion euros fine for three chemical companies
- 992 miljon fine for four elevator builders
- 396,6 miljon fine for Siemens (of a total sum 750,7 miljon over 11 companies)
- 344 miljon for four plexiglass companies

Since MS is a very, very large company I don't see your point.

[iczer2 @ Nov 9th 2007 10:40AM]

@Rik

So then you're saying that the EU is equal opportunity when it comes to fining anything that remotely touches the private sector. *whew* I'm sure glad you cleared that up. And here I was under the mistaken impression they just liked to take on foreign corporations, but it turns out to be worse, they attack even their own companies.

Lovely.

[Christopher @ Sep 17th 2007 5:07AM]

Give it another six months and the ECJ will pipe up with something like "why haven't you paid us yet? We're still hanging on the telephone waiting for your call Billy! xx"

(sorry, Blondie came on the radio as I was typing ;)

All this prancing and posturing is pointless, makes me wonder why I even bother paying my taxes sometimes if all that happens is that the EU takes a cut from our GDP and just goes and spends it on stupid things like chauffeured cars for their MEPs. Nobody really cares about this - I just wish MS would release a new Windows Update which'd revert ActiveX plugins to how they behaved before that company sued them for patent breach (I hate having to click or hit the spacebar to make some Flash work when I'm using other machines, and Opera has the same problem). THAT's the kind of thing we care about!

[chocolate rain @ Sep 17th 2007 5:15AM]

Uncle Sam: so this means war....?

E.U:..yep!

[chocolate rain @ Sep 17th 2007 5:16AM]

Uncle Sam: ..ooh...we can do war! right W?

[anti-commie @ Sep 17th 2007 5:22AM]

Euro fascists...

[Peppie @ Sep 17th 2007 9:48AM]

Actually, many label the European Commission as socialists. Calling them fascists would be incorrect.

[Jeebus @ Sep 17th 2007 12:17PM]

"Calling them fascists would be incorrect."

Actually, the term "fascist" is quite fitting for the EU. Read the definition and you'll see why.

[Alfonso Jiménez @ Sep 17th 2007 5:31AM]

Yay! Besides, I wouldn't let Microsoft to sell its products anymore :)

[nick-z @ Sep 17th 2007 5:33AM]

I don't like the bias in this article, when it speaks about 'additional insult'. This means implicitly that engadget endorses monopolistic exploitation by Microsoft, just because it affects an American company.
There are clear rules in Europe about competitive behavior and they are very fair. If Microsoft wishes to serve that market, let them follow those rules. The same rules apply to European companies, so all the comments about Euro fascists, USA being treated wrong are a bit short sighted.

[iczer2 @ Sep 17th 2007 8:32AM]

"There are clear rules in Europe about competitive behavior and they are very fair. If Microsoft wishes to serve that market, let them follow those rules. The same rules apply to European companies, so all the comments about Euro fascists, USA being treated wrong are a bit short sighted."

The rules may be fair, but I question the politics behind the entire affair. There were times during these proceedings where it seemed that no matter what Microsoft did to address their concerns it was never good enough. Now, I have not see the documentation itself, but I have to wonder if this entire thing is being held up on technicalities in order to attack a foreign company that might be viewed as having too much power.

[Phil @ Sep 17th 2007 12:43PM]

@ iczer2 ^ ^ "this entire thing is being held up on technicalities in order to attack a foreign company that might be viewed as having too much power."

And that's a bad thing? Personally, I disagree. Look, MS were caught out. Now they pay the price, just like many EUROPEAN companies do.

And a company monopolising anything is extremely bad for any industry in my opinion.

[nick-z @ Sep 17th 2007 5:47AM]

BTW, if they would have paid right away in 2004, Microsoft would have saved USD 70 million, as the dollar dropped from 0.81 to 0.71 $/€

[Firn @ Sep 17th 2007 6:28AM]

They did pay right away; the money was transferred to a frozen bank account after the first court ruled, awaiting the following processes.

[Tony @ Sep 17th 2007 6:02AM]

Its not enough. Microshit must be bankrupted and paralyzed once and for all!

[ILOVEBLENDTEC @ Sep 18th 2007 3:15AM]

see thats a bit of an ignorant comment, seeing as to how MS is a global presence (PC's and Cell Phones') and most servers and government computers use MS OS's, you'd pretty much be asking to cripple the worlds communication and banking, sure u got linux and macs but ive yet to see and apple\linux server in federal offices. i mean look at this for a loose example of "ridding MS"

http://www.engadget.com/2007/03/22/alaska-department-of-revenue-vaporizes-38-billion-account/

[treetrunk @ Sep 17th 2007 6:09AM]

Is this /still/ about windows media player? I can see why Real et. al might be pissed about it, but I've never thought they had a leg to stand on. Now that everyone and their mum's got an iPod and a phone which plays mp3s people simply EXPECT media playing capability straight out of the box, just like they'd expect a car to come with a stereo. Real complaining to Microsoft for bundling WMP would be like Sony complaining to Ford for pre-installing non-Sony stereos in their cars!

Real's real problem (excuse the wordplay) is that they simply made a bad product. I haven't gone anywhere near Realplayer in years - it might be great now for all I know, but I really don't care - as last I saw it it was a rubbish, bloated piece of crap full of adverts and system-tray "messages" which tries to take over your machine.

[Andy S. @ Sep 17th 2007 10:10AM]

You're comparing apples and oranges.

First of all, yeah, people expect media playback features from the iPod and iPhone straight out of the box because media playback is one of the *primary functions* of those devices. Windows is (or should be) an operating system, not a media player.

And while people expect a car to come with a stereo, nobody buys a car strictly so that they can listen to music. The fact that the stereo comes with the car is an added feature. In order to make the WMP -> car stereo comparison work, you'd have to imagine that Ford installs only Ford stereos in their cars, and that, while you can install an additional stereo from another manufacturer in your car, you can't ever actually *remove* the Ford stereo, as it is somehow tightly integrated with the rest of the car's electronics. Also, the Ford stereo would have to be able to play back music that is recorded in a proprietary Ford format; other manufacturers who want to be able to play back or record in this format would have to pay a licensing fee to Ford, so even if you buy and install another stereo in your car, Ford would make money off of that, too.

It doesn't matter whether or not Real's product was crap. The fact is that what Microsoft's doing by bundling WMP is making it *more difficult* for competitors to enter the market. And let's face it, spending the time and money to develop a product to compete with a media player that is already available on *EVERY* Windows install in the world is *NOT* a very good business decision, as the odds of making a profit are slim, even if your product is absolutely amazing in every way. People are lazy, and getting them to switch away from what they already have is difficult if it requires any amount of effort. Why do you think there are so many people who still use the default ring tone on their mobile phones? Laziness.

(and really, if you developed a product that was superior to WMP, Microsoft would just buy you out and incorporate your technology into WMP anyway. That's how they work.)

[Nick @ Sep 17th 2007 10:32AM]

Andy S.

I understand and I agree that it does make it harder for other brands to enter the market, but also it makes it harder for the consumers to get their computer set up to use. Based upon this idea that MS is being sued for... one would then conclude that this ruling would and could apply to anti-virus software, automatic backups, web browsers, cd/dvd burning software, picture viewing and editings, etc. It's highly unlikely but what they could end up doing is causing people's machines to literally come with Windows.. then you have to get either have to go out and download/buy or install everything else which isnt very easy for the consumer. Sure WMP sucks and so does IE, but there is no reason for it not to be standard.

If people dont like it they can go out and buy something else. I guess to avoid all of this instead of being stubborn MS could have just pulled those applications out of the windows OS installer disks and put those onto a seperate disk that the user then has the choice to install or not... I'm sure the cost of all those extra CD's is a lot less expensive than the current fines.

I wonder what the EU will do to Apple and rip apart all the nice integration that Apple does with iLife.

[Jeebus @ Sep 17th 2007 12:26PM]

"Why do you think there are so many people who still use the default ring tone on their mobile phones? Laziness."
So by your logic, mobile phones should not be allowed to come with a default ring tone?

[Andir3.0 @ Sep 17th 2007 1:53PM]

No, because you always have a choice to choose a different phone company with a different default ring tone. There's no choice here. MS made sure of that when they promise to sell Windows cheaper to clients that don't use ___ software and sell their proprietary OS with proprietary media interfaces and proprietary APIs and proprietary office products with proprietary document formats. If MS is forced to comply with open standards, it would kill them because they'd have to compete with free software and Apple.

[Aaron @ Sep 17th 2007 7:05PM]

I agree- Real Player is unused because it is poorly designed and add-incumbered. But, I am willing to bet teh here in the States, that nearly half of the avid music users rely on iTunes or Winamp. Is that really a stranglehold on the market? Apple created a decent product(iTunes) and they are doing just fine.

Besides, what consumers are complaining that because MS Paint is included in Windows, they cant get good competetive graphics software? All someone has to do is create a better product, which many companies have done. Real has an open enough market, but needs a better product if they want chance. They dont need half a billion dollars in fines assesed to tehir competitiion.

[john stires @ Sep 17th 2007 6:23AM]

what vitriol! THANK YOU, Microsoft and Bill Gates, for presenting the world with your incredible technology. You might have stubbed a few toes along the way but your sacrifice over the years has meant a better world for all of us. I say 'Thanks'.

[Dinraj @ Sep 17th 2007 6:35AM]

I cant believe all this bullshit thats been happening. Google crying over instant-search. Real crying over Media player. Win users always have a choice. They can install Winamp, Bloaty RealPlayer, iTunes...anything and windows supports it fine. And if they really want to remove the windows media player component, they can do so via the add/ remove. Realnetworks, should blame themselves over a sub-standard product.

If you build a better product, users will patronize it. Firefox is such a great example.

[Andir3.0 @ Sep 17th 2007 7:12AM]

"they can do so via the add/ remove"

Actually, you can't. It took a special install of windows to totally remove Media Player on my machine.