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Microsoft To Be Fined E500M By European Union?
An anonymous reader writes "According to a Reuters story, the European Commission is in the process of fining Microsoft 497 million Euros ($613 million). The most important reason for the fine was the refusal by Microsoft to share more information about its products with competitors. Mario Monti, the EU competition commissioner, decided to impose the fine after talks with Microsoft broke down last week." The last estimate was a mere 100 million Euros, and it's noted: "If the full European Commission backs the fine as expected on Wednesday it would exceed the 462 million euro penalty imposed on Hoffman-La Roche AG in 2001 for being ringleader of a vitamin cartel."
~ The Timeline ~
March 25, 2004 Microsoft fined E497M by the EU.
April 05, 2004 Microsoft files appeal.
June 11, 2004 Verdict upheld.
June 22, 2004 Microsoft contributes heavily to the Republican party.
July 05, 2004 EU declared part of the "Axis of Evil"
July 13, 2004 Colin Powell declares the EU has "Weapons of mass destruction, without a doubt."
July 27, 2004 US troops roll into the EU to promote Bush's "World Liberation '04" re-election campaign.
Trolling is a art,
Nothing strikes fear into the hearts of your enemies like being "the ringleader of a vitamin cartel." :)
What is E500M in Windows 98SE licenses?
From the article:
The fine amounts to slightly more than one percent of Microsoft's roughly $53 billion cash on hand and did not impress analysts and critics.
"This is a traffic ticket for Microsoft," said Thomas Vinje of Clifford Chance, who represents Microsoft critics.
Neil Macehiter, an analyst with London-based technology research firm Ovum, said even a $3 billion fine would have been "an irritant to Microsoft but certainly wouldn't break the bank."
Rule #1 -- Politics always trumps technology.
It's nice to see that some governmental anti-trust bodies have the backbone to stand up to Microsoft. Rather than finding them guilty of anti-trust laws, then slapping them on the wrist....
I am concerned about any program, any piece of hardware, any treaty, any law that treats me as a consumer, not a citizen
why would MS have to comply? Couldnt they just say 'okay, BYE' and not sell in Europe anymore? I know MS sells a lot in europe.... but who would be more injured by such a move, MS or the EU?
or is there some international law that says MS MUST comply?
not a troll, just some questions, as IANAL.
What are the chances Bill G. & Co. will pay off the fine by buying cheap laptops in NYC and selling them in Europe while dodging the VAT?
The summary failed to mention that they will be forced to release a version of Windows without Media Player and 'encourage' the use of other media players. Good riddance to bad rubbish!
LilMikey.com... I'll stop doing it when you sto
Can you even say that phrase with a straight face and not think of Fred Flintstone as a Columbian drug lord?
"...today consumers have been conditioned to think of beer when they see a bullfrog..."
It's good to know that European courts aren't as flawed as our American ones.
It almost restores your faith in humanity. Almost.
- Sherman
"Cash okay..?" <while reaching for his wallet>
With $53 billion in the coffers, $613 million is a big ol' slap on the wrist.
The article says that the major reason for the fines is Microsoft's refusal to license information to competitors to ensure compatibility.
In other words, the actual software that these laws protects is horrible stuff like RealOne and Quicktime. Open source projects can't afford to license things. I'll be even more impressed than I already am if Mplayer and the like can continue their higher quality in the face of such crappy capitalistic laws.
Step 1) Eliminate Competition
Step 2) Profit! ($40 Billion in cash)
Step 3) Get fined $0.5 Billion for being naughty
Step 4) More profit!
Value of fine benefits of bad behavior. Bad behavior continues...
When are governments going to get a clue? Screw fines - almost no amount of money you can take from them will really have an effect on their behavior or the market. What the EU ought to do is to tell MS that if they want to do future business in Europe, they need to make the Office file formats an EMCA standard, and that any patents they have on the formats must be licenesed royalty-free. That would create real change and competition in the market - let them compete on implementation, as it ought to be!
The Free desktop that Just Works
Unforunately, like all big businesses, any government fines or restrictions will inevitably be passed on down to their consumers. But I have a feeling none of this 500 million slap-on-the-wrist will go anywhere near Microsoft consumers. Expect to see price hikes in the future.
Corporations: your universal scapegoat for all society's ills.
It is about smacking them in the head to get their attention.
If Microsoft doesn't change its practices, we can see more fines such as this. Eventually, Microsoft will change.
Why _SHOULD_ microsoft go out of business?
It is one thing to aim for fairness, it is another thing to just be blinded by hate.
The current ruling could set a useful precedent... with someone finally having the guts to intervene against illegal abuse of monopolies, Microsoft may finally have to pay for the damage it has done to the software industry and users
Yes. I beleive that would be a first for this administration- correctly guessing who has them.
I still have more fans than freaks. WTF is wrong with you people?
- All your BMW and Mercedes cars
- The jet engines from your aircraft (invented by Sir Frank Whittle in Britain in 1945)
- All your nuclear weapons and X-Ray machines (since radioactivity was discovered by the French Marie Curie in the 19th century)
- The ideas that the Wright Brothers stole from Leonardo Da Vinci (Italian)
By return of post, we will send back:
- Macdonalds
- All our Hoover vacuum cleaners (since we now have the much superior British Dyson vacuum cleaners)
- "Charmed", "Smallville" & "Dawson's Creek" (however, we'd like to keep a copy of "The Simpsons" just to remember you guys by!)
Ciao, toodle pip and au revoir.
Gentoo Linux - another day, another USE flag.
The real penalty for Microsoft is having to extract it's media player from the OS and collaborate with other software company media companies. This will increase their support costs in the long run.
humble and proud of it.
Mario Monti: "Here's the plan. We fine Microsoft and we hold them ransom for......five hundred MILLION dollars!"
EUC Number Two: "Uh huh hum. Well, don't you think we should maybe ask for more than five hundred million dollars? Five hundred million dollars isn't exactly a lot of money these days. The EUC alone makes over ninety billion dollars a year."
Mario Monti: "Really?"
EUC Number Two: "Uh huh!"
Mario Monti: "That's a lot. Okay then. We hold Microsoft ransom for..... five hundred BILLION dollars!!"
*Evil Laughter*
Microsoft associate general counsel for Europe Horacio Gutierrez said in a statement the fine was unjustified. "We believe it's unprecedented and inappropriate for the Commission to impose a fine on a company's U.S. operations when those operations are already regulated by the U.S. government and the conduct at issue has been permitted by both the Department of Justice and the U.S. courts," he said.
I'm sorry, but if you trade into the EU, then you are expected to obey the laws of that market. Doesn't matter where the head office is. I'd have thought that Bill would employ lawyers with a clue - at least enough of a clue not to make a stupid statement like this.
- All your BMW and Mercedes cars
Fine - they are unrealiable: we are keeping the Japanese cars tho.
> The jet engines from your aircraft (invented by Sir Frank Whittle in Britain in 1945)
You can have the prototypes the he never managed to get working - took the Germans to do that, and the US to perfect them.
> All your nuclear weapons and X-Ray machines (since radioactivity was discovered by the French Marie Curie in the 19th century)
Yeah she really did a bang up job with that, eh?
> The ideas that the Wright Brothers stole from Leonardo Da Vinci (Italian)
OK here you have me - the wearable bat suits and cork screw helicopters powered by men walking around in circles are all yours.
I am very small, utmostly microscopic.
Well, I keep hearing talks about Microsoft being a monopoly and needing to be punished. But, what I want to know is what are they actually being punished for.
For being a monopoly. Or rather, using their monopoly position to leverage themselves against competitors.
Spending millions of dollars to develop IE which was then distributed free with Windows pushed Netscape out of the browser business fast.
Now they're trying to do the same with AIM, Real, iTunes, well, you name it!
Doing that kind of stuff is not legal in the USA, nor is it legal in any western country. And for good reason: Monopoly practices are bad for everybody except the monopolist.
It's damaging to the economy. It's damaging for consumers.
Or to put it another way: Capitalism is it's own worst enemy.
(and that was pretty much agreed upon until certain politicans realized that big businesses had bigger pockets for campaign spending)
I'm pretty sure that at least one of the European Union countries is involved in Microsoft's Shared Source program. If they don't pay the fine, the European Union could seize the copyright (in lieu of payment of the fine), get a copy of the code, and sell the source code to one of their own software companies. That would presumably be worth the 500 million euros, even ignoring any other assets that may exist.
;)
:)
Microsoft traditionally outsources most of their development, so there is no reason to think that the new company couldn't continue development. Possibly with the same Indian developers as are working on the Microsoft code
Maybe they will even open source it to fix the bugs
In the OS I installed,
Lived a player,
By Microsoft,
And it told us what to do,
With our music and DVDs,
So we took it to the EC,
And we told them what we found,
And they gave Bill a big fine,
And they told him to take it out,
-Chorus-
We don't need your stinking DRM,
We are European,
We are European,
Bill can stick his codecs in the bin,
We are European,
We are European.
And our friend is little Tux,
Cos he let's us do what we please,
Bill can go and boil his head,
While we drink beer from Ballmer's skull
-Chorus-
We don't need your stinking DRM,
We are European,
We are European,
Bill can stick his codecs in the bin,
We are European,
We are European.
Now we live a life of ease,
Everyone of us,
Is European,
We can play the tunes we like
We can watch the films we need
We don't pay no MS tax
We are free from DRM
-Chorus-
We don't need your stinking DRM,
We are European,
We are European,
Bill can stick his codecs in the bin,
We are European,
We are European.
Gentoo Linux - another day, another USE flag.
One of the things I love about being in the field of computer science is that it is still young. Years and years from now, there will be discussions in history books about Microsoft and all the good/evil things that came about from their aggressive domination of the industry. This EU judgment may even be cited... "Microsoft began to lose power in the early 21st century as it fell victim to a barrage of heavy fines for anti-competitive behavior. In 2004, the software giant faced its stiffest fine yet from the European Union at $613 million dollars. While this was a drop in the bucket to a company with $40 billion in cash reserves, it set a precedent that other countries soon followed."
Magnatune: Quality (DRM-free) MP3/FLAC/
It's not chump change. It's a small but significant dent, which they've unceremoniously been given in spite of Ballmer's best efforts to talk the authorities down last week.
It's also widely rumoured to be accompanied by (a) a compulsion to ship a version of Windows with Media Player completely stripped out, in order to remove the artificial dominance Microsoft has secured over the multimedia world, and (b) heavy penalty conditions if Microsoft gets up to this stuff again, so lengthy court action can be replaced by abruptly hitting them when they're down. These are, for now, only rumours, since the ruling won't be made public until later this week. However, no-one's jumping up and down denying them, and it's well known that all the European parties and Microsoft have seen that ruling. Draw any conclusions from that you like, or wait to see for sure mid-week.
At any rate, this isn't meant to kill Microsoft. It's meant to make them behave, and to reopen competition in the marketplace for the benefit of the public. In that respect, it seems fairly well judged, assuming the above rumours are reasonably accurate.
If you disagree, post your argument. (-1, Overrated) isn't your personal censorship tool for views you don't like.
Fines are a weak response, as it has been stated over again, this is piss in a pond to the likes of Microsoft.
On the other hand, the European Commission has the power under Article 81 and 82 of the EC Treaty (which where anti-competitive behaviour is prohibited) to impose structural remedies: to insist upon corporate re-organisation or say an order to disclose information or to unbundle software. This would be a far more appropriate remedy that would actually be economically useful rather than a bit more cash in the bank for EU.
If the commission really has spine, it will seek this type of remedy rather than the easy way out. It may in fact seek a combination of fines and structural remedy, so we'll just have to wait and see.
A fine should at least make it unprofitable for me to commit the crime again. If I stole 1 million and was fined 1000 then that is not exactly going to stop me is it? So how much did MS make by violating the law? More then 500 million? Then they ain't gonna stop.
MMO Quests are like orgasms:
You may solo them, I prefer them in a group.
That's quite a logical leap in four years. It's possible that Iraq developed the aforementioned weapons in four years, but based on what the troops found in the country, such a program would be in its infancy at best.
Had the EU (such as it was) approached Microsoft ten or fiteen years ago, and said: "We'll let you engage in anti-competitve practices in operating sytems, office applications, web browsers, and media players all you like for a crisp half-billion dollars, payable on delivery", do you think they would have taken the deal?
They have $50 Billion dollars in cash. 1% of one's cash reserves (never mind revenues) is simply not a punishment.
Imagine being taxed one percent of your life savings for a license to break all the laws you like. That sounds like a pretty sweet deal to me.
The problem with fines is that business already thinks in terms of money. Punishments for breaking the law are intended to deter behaviour. Fines are instead framed by the company as just the cost of doing business.
Agreed that 500-600 million is nothing for Microsoft, but what IF they took the money and used it to fund FLOSS. Assume the govts weasel 50% off the top! That leaves 250-300 million for FLOSS.
:) ]
This is where the real damage to MS could occur, if the penalty cash is dished out to the right FLOSS projects that threatens MS directly.
Proposed split based on what I think would help FLOSS and hurt MS:
50million for the Linux Kernel to get their security certifications finished for govt usage, driver improvements to the kernel, SE-Linux integration, whatever else Linus wants
50million for Apache Webserver, Tomcat, and other Apache-based projects that really eat into IIS market share
25million for OpenOffice with a focus on compatibility with MS Office.
25million for GNOME & KDE, split evenly on whatever they want, but with a preference on creating a Win2k-style desktop emulator so the riff-raff can change their screensavers like before
10million for plug-ins/features into Eclipse IDE that help emulate the best features of Visual Studio, and better integration of non-Java languages like Perl, PHP, C#/Mono, etc
10million on Bitkeeper replacement and/or Subversion to get great source code control mgmt, tied into Eclipse IDE enhancements above
10million on modeling tools for code or databases like SQL Navigator, or Rational Rose
10million for PHP on whatever they think they need
10million for Wine to get us closer to running lots of apps on non-MS Operating systems
10Million for ***BSD Flavors [Just because they have created so much with so little
10million for RMS and GNU with the promise he wont complain about everyone else's cash allotment
AND
25million for an investment fund that donates 50% of the yearly profits as grants to future promising FLOSS projects
So how much did MS make by violating the law? More then 500 million? Then they ain't gonna stop.
Yes, this is exactly the problem. Where I live, there is a suburb that has repeatedly dumped raw sewage into the river that runs through the city rather than send it to a waste processing facility because the EPA fine is less than the cost of the treatment. There is no incentive for the city to stop doing this as long as it costs less.
The same analogy applies to Microsoft. If they make more by squeezing out the competition unfairly than they lose in fines, it's still a net gain for them overall and the next time around, there's fewer players to have to squeeze out. It's a win-win for them and a lose for everyone else (except the custodians of the fine money, it seems).
Rule #1 -- Politics always trumps technology.
Nope--there was nothing funny at all about the price-fixing in vitamins led by Hoffman-LaRoche. I know a manager at a local plant of Hoffman-LaRoche, and used to work (in a different industry) with a man who at one point was HLR's general manager of animal vitamins. So I've heard about the court case (which went on for years, and included anti-trust action in the EU and in the United States, and possibly elsewhere).
Is price-fixing in vitamins a big deal?
First, we're not talking about somebody trying to corner the market in One-A-Day tablets. We're talking about a small group of chemical companies colluding to fix the prices of (and markets for) vitamins that are included in food products. That's things like the Vitamin D in your milk. And--more significantly in terms of market size--it is the vitamin supplements included in animal feeds.
A brief discussion of animal feed
I am a geek--but I am a geek who is heavily involved in 4-H (non-U.S. readers: 4-H is a program for American youth [mostly farm youth] funded by the U.S. Dept. of Agriculture.) People who are feeding animals frequently want to feed a "complete" feed--a feed that includes all of the nutrients an animal requires. Example: dog food. You don't want Bowser running down kids in the neighborhood to supplement the meager protein requirement you feed him: you want him to get all the nutrition he requires from his bowl. In the same way, most cat owners don't want little Fiona sneaking out to hunt down the local rodent population just because there isn't enough "meat, and meat byproducts" in her Fancy Feast. (In case you're curious, a "meat byproduct" is what goes crunch when little Fiona does manage to eat one of the local rodents.)
Are you with me so far? If you live in the urban jungle you may not think of animal feeds beyond dogs and cats. And while that business is not small, there is also a huge business in other animal feeds. Think of cows, horses, chickens, and turkeys. In a nutshell, "chicken feed isn't chicken feed." Animal feeds are a multi-billion dollar business--and a major cost component for a feed manufacturer is the cost of the vitamin supplements included in the feed.
So the manufacturers get together...
It has been illegal for many years, in the United States, for manufacturers to compare prices or sales practices for common customers. But price and/or market collusion was not illegal in many other countries--and a number of multinational companies got a bit clever. If it wasn't illegal to collude on pricing in Switzerland (and in the 1980s it was not) you simply met with your counterparts in Switzerland, agreed on your prices and markets, and shook hands. According to a friend who was involved in some of these meetings (in Switzerland) everybody benefited: the people involved made their sales quotas, kept their profits up, and were spared the headaches of having to endure real competition. Sure--the customers (and ultimately the consumer) got rooked, but that was a "political issue." My friend (a U.K. citizen) assured me that Americans were far too zealous about such things. All of that ended when the U.S. government found out about it--Hoffman LaRoche, a Swiss company, settled for $500 million; BASF ("we don't make the products you buy, we just make them cost more") agreed to a fine of $250 million; other companies involved paid lesser amounts.
Want to know more?
One of the really cool things about the Web in general, and SlashDot in particular, is the ability to click on a link and go off on a tangent--learning something you'd never even thought of before. This link connects to a law firm involved in the matter.
I'm pretty sure that would be a violation of international law. I don't believe there's anything in international law that allows governments to seize copyrights as remediation in lieu of fines. I'm also pretty sure that MS made it so that no one who participates in Shared Source can do anything worth a damn for similar reasons as you outline.
The strange thing is the eerie silence in the european media about this kind of stuff. Or is it just me? I love the americans for their angry websites and wild discussions when stuff like this happens. I have to read about this and on an americam website. Should i as a dutchmen check german websites or learn french or swedish to hear about this ?
- Fine Microsoft scary amount of cash (just for show)
- Have Microsoft appeal in the most painstaking, bogged-down way imaginable
- Watch incredible amounts of $$$ flow into the European legal business and become EUR=> Profit
Do you now see the brilliance? All that cash being siphoned off from America's flourishing legal system, will be transferred directly to Europe. And the best thing is, Microsoft is doing all the dirty work for us!Divide et impera!
I can see that the Anti MS sentiment is strong enough for everyone to overlook this, but doesn't it seem a bit unfortunate for half a billion US dollars to fly off to fill some European government treasury?
Microsoft have been abusing their monopoly for years to the detriment of European citizens. Those "half billion US dollars" don't all come from the USA you know. Next time you see a "Windows worm estimated to have caused XXX kajillion dollars in damages", please remember that those worms don't just affect USA companies. Next time you see Microsoft kill competition by bundling applications with their operating system (virus scanners next, right?), remember that some of those companies were European.
Why is it that people believe any old lie no matter how silly.
He did not have any sort of a program in it's infancy. He used to have lots of chemical weapons (we gave him the knowhow). He used them during the Reagan Admnistration (you may want to read up on that).
After the first gulf war he was ordered to dismantle both his nuclear programs and his stockpiles of chemical weapons. He destroyed the nuclear program under the watch of the weapons inspectors. Both Hans Blix and Mohammed albredaei (sp?) have documented this phase. They also claim that they destroyed all the chemical weapons but not all of the destruction was documented. That's why a second round of inspections were ordered. During those inspections every single scientist interviewed stated that they destroyed the chemicals. They told the inspectors where the destruction took place. The inspectors found evidence of destruction but it was impossible to determine exactly how much was destroyed.
Those are the facts. I know they don't fit everybodies ideology but they are facts nevertheless.
It may be that not all the weapons were destroyed but it's highly unlikely that those chemicals are still viable. Even if they exist they are probably inert by now. If he had them we would have used them.
The best way to support the US war effort is to continue buying American products.
What do you mean "worked"?. Clinton's Iraq policy did indeed work in that it accomplished what he wanted to accomplish. The goal being keeping Saddam under control and a non threat to the US and it's interests. Saddam was declawed enough to make him a non threating to the US, it's allies and it's interests. Clinton accomplished this with minimal amount of expenditure of lives and money. His plan worked perfectly and accomplished exactly what he wanted to do. As I said he had no desire to cram socialism down their throats. He felt that saddam was the problem of the Iraqis and it was up to them to do something about it. He really didn't care all that much about your average Iraqi, he was only concerned with US interests.
Bush had different policy goals. He wanted to invade and occupy iraq and was not content to merely contain saddam. His motivations were complex (oil, his father, biblical prophecy, US hegemony etc) but he knew from day one that he wanted to control iraq totally and absolutely. He too accomplished what he wanted even though it cost lots of money and lots of lives.
In the end both Clinton and Bush were looking out for their own interests. The interests of the Iraqis was and remains totally irrelevent.
If Bush had stood up before 9/11 and said "The US will use it's wealth, power and military might to end opression in the world and to destroy all dictators" I would be lining up to give him money and support. If he had said "we will deliver democracy to everybody and free everybody from the chains of opression and bondage no matter what it costs in lives and money" I would walk around my town begging people to vote for him.
He didn't say that because that's never been his goal. He will not lift a finger to deliver freedom to chechnians, palestenians, africans, tibetians, chinese, and the tens of millions of people suffering all over the world because they don't have something he wants.
I am still waiting for somebody (anybody) to explain to me why the Iraqi people deserved socialism more then any other people on the planet. Why they had to be delivered from evil first. It seems to me that your average north korean is and has been much more opressed. The average chechnians is much poorer, the average east timorese has suffered much more death and bloodshed, the average tibetians much more misery and ethnic cleansing. Too bad none of them have oil, too bad the bible makes no mention of them, too bad none of their leaders tried to kill his father.
The best way to support the US war effort is to continue buying American products.
I have to disagree with you because MS has all most all of the desktop market. How about what MS has done too:
DR-DOS - Would not run under 95 because of a TSR that look for DR-DOS
Stacker - Added to DOS 6.0 to kill them
Netscape - IE for FREE with OS
OS/2 - OS2 and Win 3.1 was going to come out at the same time. MS did not wait.
Lotus 123 - The OS is not done until Lotus does not run.
Word Perfect - Lets give Word with the OS to lock people in.
Java - Lets change the stander so MS JAVA would not run on any other platform.
Is Real Audio or Google next?
If there was five large companies making an OS systems, I would now have a problem with them adding new stuff. But when one company has 90% of the market and killing anyone else that might have a good idea. I have a real problem with them.
If you look at the pricing of MS it is starting to come down because of Linux. I have seen MS paid to fix problems with their systems because the company was going to switch to Linux for that service. There servers are going over slower to Linux now. It would have been faster if MS was not helping.
I think the writing is on the wall we just need to wait.