Microsoft lawyers face more paperwork

11 Feb 2003

Computer software giant Microsoft just can’t seem to stay out of legal trouble, as news breaks of yet another anti-trust move against it – this time by an association of global telephone, computer and consumer electronics companies.

The US-based Computer and Communications Industry Association (CCIA) has filed a formal complaint to the European Commission alleging that, among other things, by bundling products into Windows XP – including music and video-editing software – it poses yet another threat to competition.

“Alternatives are foreclosed through Microsoft’s bundling practices,” according to the CCIA.

In a massive document presented to the Competition Commissioner, Mario Monti, the coalition claimed that Windows XP bundles Internet Explorer and another browser MSN Explorer, as well as audio and video player Windows Media Player, instant messaging software Windows Messenger, email client Outlook Express and video editor Windows Movie Maker.

The coalition, which includes some of the heaviest hitters in the technology industry, notably Oracle, Sun Microsystems, AOL Time Warner, Nokia and Yahoo Inc. wants Microsoft to unbundle the products contained in Windows XP to give a chance to its competitors.

In the document the CCIA complains: “The Commission and the courts have long recognised that Article 82 (of the EU Treaty) forbids tying or bundling of a dominant product with another product and Microsoft’s pervasive bundling of software in its Windows XP product infringes Article 82.”

It also wants to force Microsoft to carry Java technology in Windows.

Speaking last year boss Bill Gates, however, argued that: “By reducing Windows to some undefined ‘core operating system’ the [EU member] states would turn back the clock on Windows development by 10 years and effectively freeze it there.”

Courts in the US have already famously found that Microsoft illegally used its dominance in the market to crush competition. However, the CCIA says that the US Department of Justice “chose to abandon meaningful anti-trust remedies”.

Commissioner Monti received the CCIA’s 260-page document as he continued to mull over what to do about other anti-competition allegations against Microsoft, notably that it committed illegal practices with older versions of its software.

The CCIA is also alleging that Windows is designed to work more effectively with its own server software than that of its rivals and therefore making it harder for competitors who use Linux, or other versions of the Unix operating systems.

The document argues that Apple, the second largest player on the market, has a diminishing market share of less than 5pc, while Linux has had only limited success on the server market and has no presence on the desktop market. It also says Microsoft’s position in the PC operating systems market was coming close to 100pc, or complete dominance.

Responding to the CCIA document today, the EC said it would look into the new complaint but advised that consideration of it may be delayed because of the existing investigations into the giant.

EC spokeswoman for competition affairs Amelia Torres said: “We will look into it and analyse it on its merits.”

But she added that they would be looking at it separately to the existing on-going examination of Microsoft’s practices, which it hopes to complete early this year.

“It will not make sense to bring any new aspects into the on-going case as this will only have the effect of delaying a conclusion on it,” she concluded.

By Suzanne Byrne