European Union Fines Microsoft $357 Million

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The New York Sun

BRUSSELS, Belgium — The European Union levied a second massive fine on Microsoft and threatened greater penalties in the future unless the world’s largest software company obeys a 2004 antitrust order to share technical details of its Windows operating system with rivals.

Microsoft Corp. was fined $357 million yesterday for allegedly flouting the earlier order, on top of the record $613 million fine it paid at the time. It also faces new penalties of $3.82 million a day beginning July 31.

“Microsoft has still not put an end to its illegal conduct,” said E.U. Competition Commissioner Neelie Kroes. “I have no alternative but to levy penalty payments for this continued compliance. No company is above the law.”

Microsoft — which in comparison earned $2.98 billion in the quarter ended March 31 — said it would appeal, claiming the “unprecedented” amount was unfair. Microsoft General Counsel Brad Smith said the company would ask the E.U.’s second-highest court, the Court of First Instance, if its compliance efforts have been sufficient, claiming that the E.U. had never been clear about what it wanted.

The E.U. told the company to supply “complete and accurate technical specifications” to developers to help them make software for servers that help computers running Windows, printers and other devices on a network talk to each other. It accused Microsoft of using its monopoly position with Windows to elbow into the new server software market.

But Mr. Smith said the E.U. had not been clear about its demands and how Microsoft should present the information. “Before one imposes a fine of hundreds of millions of euros, I think that there’s a responsibility the government has to be specific and concrete about what it wants someone to do,” he told reporters in a conference call.

Ms. Kroes said Microsoft’s earlier efforts had not come even close to a readable manual developers could use. Her decision is based on reports from an independent monitor — computer science professor Neil Barrett — and other technical advisers.


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