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DOJ Calls EU Microsoft Decision "Unfortunate"
ogma writes "This one is especially ironic after the recent slashdot story on more of Microsoft's underhanded actions coming to light. It seems that the DOJ thinks Europe was too hard on Microsoft in its anti-trust ruling.. According to Assistant Attorney General Hewitt Pate, the fine 'may send the wrong message about antitrust enforcement priorities'..." Open Council writes "The Register points out that the EU has provided Microsoft with a major victory over its Open Source rivals because it will now be allowed to pursue royalty revenue from the APIs it publishes. Jeremy Allison says that the projects such as Samba, which he jointly leads, may face a prohibitive hurdle. The size of the fine is peanuts to MS but will be a bargain if it can lock out Open Source projects from using its API's."
Bill Gates revealed his awesome new creation... the Death Star. "It's capable of destroying entire continents, as we'll soon demonstrate." he was quoted as saying.
It surpasses fines the Commission has imposed on price-fixing cartels and that may send the wrong message about antitrust enforcement priorities, Pate said.
It seems like it sends a perfectly clear message. DO NOT FUCK UP OR WE WILL HUNT YOU DOWN. The fine wasn't all that steep for what MS can afford. It was another quick bump in the road. What it shows me is that the EU cannot be bought as easily as the US can.
"Imposing antitrust liability on the basis of product enhancements and imposing 'code removal' remedies may produce unintended consequences," Pate said. "Sound antitrust policy must avoid chilling innovation and competition even by 'dominant' companies. A contrary approach risks protecting competitors, not competition, in ways that may ultimately harm innovation and the consumers that benefit from it."
I really don't believe that MS purchasing companies and rolling their products it into their OS makes it any better for the consumers. In fact, I find that updates to software by smaller companies comes often and usually w/o large upgrade fees. To upgrade software once it is rolled into the OS requires you to usually pay for another version and may take years. Sure, WMP9 came out but at the cost of a very harsh EULA that had consequences that outweighed its benefits.
Had the DOJ followed through on it's case properly earlier, I don't think that the EU ruling would have been so harsh. The EU felt they had to send a message that someone was going to stand up.
Hell, if the DOJ had pursued real resolution there might not have been a case in the EU as Media Player might have been unbundled then.
Media Player is not the biggest anti-competitive piece they have anyway.
It is more productive to voice thoughtful opinions (reply) than to judge (moderate) others.
Ah, yes, sending the wrong message about antitrust enforcement policies. Like, when someone is found guilty of anticompetitive behavior while a monopoly - actually enforcing a penalty so they don't do it again?
Sorry - my bad, what was I thinking of.
I am somewhat concerned with the EU's choice to allow MS to "license" the API's. From my perspective, those API's should be fully published with no license behind them. MS should not have to reveal the code behind how they work, but the API's should be publicly available, and any updates and changes to those API's (say, though a patch or service pack) should be immediatly updated.
Just my $0.02. As always, it's just my opinion, and I could be wrong.
52 Weeks, 52 Religions with John Hummel
I don't think fining a business with 40 billion in the bank 500 million is harsh. I think the DoJ wanted them to get a slap on the wrist like always.
The decision states that "to the extent that any of this interface information might be protected by intellectual property in the European Economic Area, Microsoft would be entitled to reasonable remuneration".
Interfaces and formats aren't protected, which is why WINE and Samba can and have been using them for years. I remember Microsoft getting in a tiff over WINE using the same header files, but backed down.
This doesn't seem to grant anything to Microsoft that they didn't already have. No biggie.
May we never see th
It doesn't seem right to me that a royalty could be charged for using api's. The api's are there and can be used by any software. Isn't that the purpose of an OS? That is, to provide an interface layer between the programs and the hardware? The royalty is payed for by the consumer when they buy the OS.
Yeah, it may send the "wrong" message about trust enforcement priorities.
Their job is to enforce antitrust legislation. To the extent that they have not enforced it upon Microsoft (and numerous other conglomerates) they are not doing their job and are guilty of dereliction of duty.
Are they worried this "wrong message" might get people thinking about what should be done to aggressive monopolies, and get people talking about the fact that pork and kickbacks are now driving policy in the US under the current administration?
A fine that large ain't hay, even for the $loth.
Intolerance for ambiguity is the mark of the authoritarian personality.
this is the same protectionist EU which is absolutely drunk in love with GI (geographic indicators). this link is a bit over the top, but not too far: http://www.kc3.co.uk/~dt/protectionism.htm also: http://www.lymec.org/article.php?sid=117 Anybody who claims that the EU as a whole does not play machiavellian economic power politics with rulings and regulations is a fool. the EU's economic policies are the equivalent of the stereotype of the US's current military ones.. unilateral, self-serving, and ultimately deadly to innocents.
Thanks to Ashcroft, the DoJ has lost all their credibility with me. If they say it's bad, well, it must be WONDERFUL.
I'd love to hear their positions on this, and a variety of other issues; can we get a DoJ interview?
Should we have broken up Ma Bell? Standard Oil? American Tobacco?
What's your position on mandatory prayer in school... how about illegal search and seizure--an idea that was ahead of its time?
pb Reply or e-mail; don't vaguely moderate.
Patty Murray's statement can be found at Murray Statement on EU Ruling Against Microsoft. Here are her contact information: http://murray.senate.gov/contact/
Fining Microsoft sounds fine but it's the wrong tool for several reasons. First, it will force Microsoft to raise prices in other ways, so the fine is a hidden tax on consumers. Second, it does not change the underlying problem, which is that Microsoft have been allowed over the last decade to establish a position from which they can control prices in a market almost devoid of real competition. Third, the timing is poor, since the EU and US are on the edge of a trade war, and the US will certainly use this as an excuse to raise barriers on EU businesses. Lastly, Microsoft will appeal and this will take years, during which there will be much argument and hostility, with no positive changes to show for it.
I don't believe for a second that Microsoft will take this fine as a warning that merits a change in behaviour. They will simply spin it into an advantage, one way or another.
What needs to be done is establish and enforce international free-competition standards via the WTO. Then, if a US company is found to be breaking these, the problem can be addressed to the right place, namely the US government.
The EU could achieve much more in the arena of competition by correcting the injustices of the patent system (which turns it into a tool for market control by large businesses), and by mandating the use of OSS licenses in all software that is developed for the EU bodies themselves.
Ceci n'est pas une signature
This just gets to me... US judicial bodies, not a political party, a president, or something *commenting* on
Vote democrat, 5.85 billion people in the world would do so if they could!!!
Hardly surprising, giving R. Hewitt Pate was one of the men who imposed MS's wristslap by the DoJ. I wonder if there might be a conflict of interest here.
Note : Allowing your senior DoJ / government lawyers *cough, Ashcroft* to be in hock to major corporations might not be a very wise idea.
"Imposing antitrust liability on the basis of product enhancements and imposing 'code removal' remedies may produce unintended consequences," Pate said. "Sound antitrust policy must avoid chilling innovation and competition even by 'dominant' companies. A contrary approach risks protecting competitors, not competition, in ways that may ultimately harm innovation and the consumers that benefit from it."
IMO , this is a very sticky subject. For instance - what if a TV manufacturer couldn't sell remotes? What if MacDonalds Couldn't sell french fries or sodas? I know that's a little silly but it is still similar.
On one hand M$ should be able to 'innovate' and add new features users want, on the other, they ARE a convicted monopoly and should not be allowed to use that position illegaly (unless of course I bought the stock at the right time). Microsoft, however, has become a victim of their own tactics.
By that I mean, that Microsoft as essentially muscled windows into what many consider is a 'staple' product (/. users excepted of course), now they may have to live with the fact that they may not forcibly bundle certain 'features' within the OS. An OS may go the route of a commodity (and in this day and age probably should, although I would probably be against any law that forces commodity pricing for windows), making MS compete in the open market, and on the basis of quality for all of Windows 'Features'.
Nevertheless, maybe we should have a definition of what an OS is, and what must be sold seperately.
It is sad to see that excellent decisions in other countries highlight the corruption of my US goverment. As a minnesotan, I say put Ventura in as president and we can eliminate corruption once and for all.
There is or can be built a machine that can simulate any physical object. -Church-Turing principle
From Groklaw :
.
Washington State's Senator Murray Asks Bush to "Engage" the EU
"'This ruling is yet another example of the EU assaulting a successful American industry and policies that support our economic growth,' said U.S. Senator Patty Murray, a Democrat from Microsoft's home state, Washington. . .
"Murray called on the Bush administration to 'engage' the EU in settling the case. 'The EU has now directly attacked the authority of the United States and our economy in general,' she said in a statement. 'American jobs and economic interests are threatened,' she said."
Um. "Engage"? She doesn't mean sending in troops or anything, does she?
Joke.
Wait a sec. Who assaulted who? Isn't the issue whether Microsoft broke the law over there? If they did, does she suggest it shouldn't matter, because they simultaneously give Americans jobs? The article points out that corporations that do sufficient business in Europe are subject to their laws, something they could avoid by not doing business there. They could also avoid consequences by not breaking any laws. I believe that would entail reading them
...of how government is tied to big busness regardless of political affiliation. In other words, the US system is corrupt. But then again, so is about every other nation on this planet.
Human nature never ceases to amaze me. Even under large orginizations called countries, corruption can and WILL take place.
Life is not for the lazy.
Why not an injunction instead of a fine? Removing less than a billion dollars from Microsoft's $50 billion in cash isn't going cause Microsoft to do anything differently. At most it will be a embarrassing publicity problem.
The EU's goal is to provide a competitive environment where other companies will have chance. This can only be done my making Microsoft compete fairly, which means forcing a change in their corporate behavior. This won't happen by confiscating 2% of their yearly revenues.
Microsoft has shown multiples time that it is unwilling to do business on a level playing field. So instead of a fine, how about immediately imposing an injunction on Microsoft making it illegal to sell their products in Europe until they comply with the EU's terms. I think this is the only way to get them to change their corporate behavior.
---- It won't be as bad as you fear or as good as you hope, but it will take twice as long as you plan.
It is unfortunate... unfortunate that the DOJ didn't do thier jobs properly the first FOUR times, allowing this company to continue to behave in an anticompetitive and illegal manner with nothing more than a wink and a nudge.
Why can't I get away with abusive and immoral practices for 25 years, leading to nothing but becoming the richest man, and company, in the world? Am I not rich enough? Is my industry not new enough to be beyond the law?
While limited one of many particular aspects of Microsoft's behavior, I applaud the EU's ruling. If anything it was too limited in scope... hopefully other cases will follow. Let's see, there is DrDos, BeOS, Word compatibility, IE, per-cpu licensing, OS only licensing, No naked licensing...
The ______ Agenda
My understanding of US government is somewhat lacking, but what does this have to do with the DoJ? MS broke EU rules, and the EU has made a decision based on that (right or wrong). It probably does have something to do with whatever department(s) handle foreign trade and relations, but what way is that the business of the DoJ?
$500 million is enormous to most companies, but it's 1/80th of the CASH that MS has in the bank. Not 1/80 of the company's total value, 1/80th of the amount that they can write a check for. Most companies would give far more than 1/80th of their cash if it meant that was the cost of maintaining a monopoly. From a cost/benefit standpoint, MS is getting off easy. That's why certain European countries have started making traffic fines a percentage of a person's income, rather than a flat rate for everyone. $150 will make me think twice about speeding, but it's the price of lunch for a millionaire. It's the same for MS. Let me ask you this. Let's say you lie, cheat, and defraud people in a completely illegal manner for years until you've become the richest man in the world. You have $40 billion in the bank. The fine for having done all of that is $500 million. Do you think that's excessive? You get to keep the other $39.5 BILLION that you extorted from people. In the world of individuals (as opposed to corporations), thieves, extorters, and embezzlers don't get to keep what they've stolen. But MS does. At least 79/80ths of it. Peanuts my friend, peanuts.
If you mod me down, I shall become less powerful than you could possibly imagine.
How much can a change in the political administration of a country influence its Justice ? In theory very little. The independence of these powers is essential to a democracy. In practice, the US DoJ changed from prosecuting a monopolist corporation (with B. Clinton) to: first letting go, and now publically defend, the same monopolist (with the current administration, which shall go unnamed ;-). Quite a change, quite a change ...
According to Assistant Attorney General Hewitt Pate, the fine 'may send the wrong message about antitrust enforcement priorities'.
You mean something like the EU pursues antitrust violators while the US doesn't?
I Am My Own Worst Enemy
What it shows me is that the EU cannot be bought as easily as the US can.
A slightly more cynical wording: It shows that the EU cannot be bought by a US company as easily as the US DOJ/presidency can.
Firstly, the ruling is about MS being a monopolist and locking out competitor products from Windows by virtue of the very deep integration of WMP within Windows. This affects commercial products like RealPlayer and some OSS players that exist for or have been ported to Windows - nothing to do with Linux.
Secondly, this decision slows down MS's plans of dominating the market with licensed DRM software, for which WMP is the "Trojan Horse" transport. This aspect of the EU decision is what really hurts MS, especially if they are forced to license the APIs for those DRM formats.
However, DRM will affect Windows users first because it will be the codecs inside Windows that get altered or replaced, over a period of time, to stop the playing of "unlicensed" media. Linux users might end up not being able to play DRM media but they'll still be able to play the standard non-DRM formats like MP3, MPEG, etc.
It would be really nice to hear from a Windows user exactly how he or she feels about having his/her rights to fair use curtailed by Microsoft, the RIAA, etc. because I have never seen a Windows user ever respond to that question.
Windows users need to remember that a major reason a lot of people use Linux is because they intend to maintain their rights to have full and complete control over the software their machines run - this has always been a core philosophy of Unix that has been carried across into Linux by the Open Source movement.
Whether MS is fined or not, whether MS exists or not, is of no importance to the majority of the Linux community.
Unfortunately, it's the poor thinking by the Windows community that will allow DRM to get pushed through that will affect everyone's rights to fair use.
I've said this before and I'll say it again - if the EU decision holds back DRM in any way, then it's a good decision. End of story.
Gentoo Linux - another day, another USE flag.
Instead of which, the little Commissars of Brussels royally screwed up by allowing MS to levy a fee for their interface specs. Which guarantees that Open Source software won't be able to use them.
Do you realize what it means?
Ii means that in one fell swoop, the Commissars kicked OSS competitiors out of MS pathway in the file and print server business. If it has been the result of bribery, I'd say "kudos to the bastards". But here, the incompetent Brussels morons apparently wanted to promote competition in this field. Unfortunately, as good carreer bureaucrats, they completely ignored the technical and market environment and used ideologically tainted views instead of reality as a decision basis. Whatever the intent, here is the result: Samba will be unable to develop new versions to follow MS changes without paying. Which they can't. So Samba will become incompatible and irrelevant. Linux will not be able to interface with future Windows 200x servers. The lock-out will be complete.
To paraphrase Linus, the destruction of Samba will be "a completely unintentional side effect". Nevertheless, that's what the Brussels Buffoons achieved. Which was to be expected, since after all, they are bureaucrats, not techies.
Heck, paying $600M for this result is a piffle. MS would gladly have payed ten times that to kill Samba, only people would have cried foul. But I'm sure Balmer is giggling right now: "Hey Bill, look at that, the Linux crowd is cheering 'cuz we have to pay the equivalent of 3 weeks of revenue!" - "Yes, Steve, little do the fools realize that we just completely won."
Once again, EU snatches defeat from the jaws of victory. And there was much rejoicing (in megacorp orations' board rooms).
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Unfortunately Linux, and *nix in general, appears to have placed importance on an SMB network, the only alternatives such as NFS are still orientated around networking computers rather than users.
OSS should present and push a simple and credible alternative standard for user orientated networking, get it standardised, and evangelize to the user community the advantages of not having a networked locked into proprietry standards (as if those compelled to upgrade thier NT servers are not allready aware!). MS should be forced to comply by user demand.
BTW, interesting that one of the few viable alternatives to SMB (as far as integrating on windows is concerned) is Novells stuff, I wonder what thier approach to the problem will be?
And if you thought that was boring you obviously havn't read my Journal ;-)
MS is also engaging in blatant hypocrisy. On one hand, they argued that since they had already had an anti-trust case in the US which they lost that the EU had no reason or right to extend the penalties beyond what was already done. They were already and ONLY bound by the US decision. On the other hand, after losing (or suffering a setback in) the Lindows case in the US (IIRC) they are now jurisdiction shopping across the globe because the US courts did not rule in their favor. Go figure...
putting the 'B' in LGBTQ+
Don't like RealPlayer? Fine don't use it, but then go find an Open Source or commercial media player that does not dictate what you can and cannot run on your PC - because that's precisely what WMP is starting to do now and will do more and more in the future.
In that way, you'll preserve your freedoms a while longer... and while you're at it, ditch IE and get Mozilla.
Gentoo Linux - another day, another USE flag.
So let me get this straight:
1. Microsoft has to pay pocket cash to pay the fine.
2. Microsoft can't bundle Windows Media Player.
3. Microsoft can now lock out all open-source projects trying to attain API compatibility. Good-bye WINE, Samba, et al.
Forgive me, but any EU decision which ends up doing significant damage to the free software movement and does minimal damage to Microsoft can't really be considered a "win" for the consumer.
That's not to mention that, compared to the DoJ ruling, this does NOTHING to reign in their monopolist tendencies. If the DoJ was a slap on the wrist, this was a loving pat on the rump. At least the DoJ got Microsoft to stop abusing OEMs who tried to give choice - all the EU ruling did was protect Real and get some money from a US corporation. If this was a big win for the EU, I can only imagine what a big defeat would be.
-Erwos
Plausible conjecture should not be misrepresented as proof positive.
In "The Age" article at http://www.theage.com.au/articles/2004/03/25/10799 39782633.html
the former head of antitrust in the DOJ under Clinton disagrees with the current head of antitrust.
"But Douglas Melamed, chief of the DoJ's antitrust division in the Clinton administration, said the EU's order made perfect sense.
"The commission did nothing that strikes me as outrageous or foolish," he said. The fine was appropriate; a good deterrent that "enables you to focus yourself on deterring wrongful conduct rather than trying to regulate it after you find it.""
The opposing reactions of the two heads of antitrust lends strong credence to the theory that Bush's election did lead to a dramatic change in the DOJ antitrust operations and was the reason why stronger action against MS was dropped.
Also, Senate Republican leader Bill Frist has hinted at sanctions and a trade war with the EU over Microsoft. According to the article in "The Age" he is quoted as saying:
"I fear that the US and the EU are heading towards a new trade war and that the commission's ruling against Microsoft is the first shot." and
"If the US Government does not make a clear and strong objection to the EU actions, we will lose influence and credibility for years to come, to the detriment of the US economy and US consumers,"
So I guess now support for MS has become intertwined with patriotism and national pride. Yay. I guess for all your Americans out there, remember, according to your beloved Republican Senate leader, the reputation of the US as a nation is now intertwined with that of MS...
``The European Commission's order for Microsoft Corp. to ship a version of Windows without the Windows Media Player could stifle innovation and help Microsoft's rivals instead of promoting fair competition, the U.S. Department of Justice's antitrust chief said Wednesday.''
Well, yes and no. Disallowing MicroSoft from bundling their apps with the OS gives competing OS and application vendors a competitive advantage. However, this _promotes_ rather than stifles competition, because, as it stands, MicroSoft pulls all the strings. I agree that assymetric measures like this should be avoided, but the system is out of balance and won't function properly until we rebalance it somehow.
I see it as a punishment; in principle, you are allowed to bundle anything with anything you please, but if you use bundling as a weapon to push competitors out of the market, the court can forbid it.
Earlier, I objected that bundling is a service to the consumer and should therefore not be limited, but I realize there is a solution: if MicroSoft can't bundle, a third party still can. They could then select the things to bundle from every product on the market, and given enough bundlers, every software gets a fair chance; at least, theoretically.
Please correct me if I got my facts wrong.
That is just plain wrong.
Samba team managed to remain interoperable through, what, Win 3.11 even, definitly Windows 95, 98, 98SE, ME, and NT 3.5, 2k, and XP series, without any acess to documentation, beyond what was freely available.
On what basis does making Microsoft make more information available to some other people make it more difficult for the Samba team to continue to do what they do, for future versions of Windows?
In short, Samba exists without Microsoft assistance. Forcing Microsoft to help a third party doesn't make it more difficult for Samba, at all.
(As an aside, given that the EU was only looking at Media players, I think that the API's will only be for Media playing interfaces - thus I don't think that, say, the printing subsystem, will bo covered in all this.)
Oh, and Samba doesn't _use_ any Windows API's. It uses the SMB protocol, and I've not seen anyone claim that Microsoft's protocols will have to be opened - the equivelent here would be the protocols that cover WMP to server negotiations, I think.
So, unless you want to point me to something I must have missed, I can't agree with you.
Even though MS, sitting on US$6e10 cash can easily afford the penalty, I'd say to the EU:
[I'm a US citizen and I don't think the EU decision is at all out of line. The US DOJ action does not seemed to have increased Microsoft's competition on the Windows desktop or innovation in general by one iota. But we're still getting charged.]
"Provided by the management for your protection."
It goes into EU general funds - the same as money paid in by member states. If we assume that it's divided in the same proportions as all EU spending, then the majority of it will likely go to agricultural subsidies.
++ Say to Elrond "Hello.".
Elrond says "No.". Elrond gives you some lunch.
I've said it before. It's been modded as flamebait before. I'll say it again and it's not a flame.
Anti-trust is DEAD under this administration. It wasn't kicking so strong under Clinton either, but it was alive. Remember the MS suit that was tossed out as soon as the Bush team took office?
the major advances in civilization are processes which all but wreck the societies in which they occur - A.N. White
EU judgement:
Ok, so the DoJ doesn't like the way things went down. Neither do I, perhaps for differant reasons.
I think that in fining MS and then telling them to release the API's, with the ability to charge for said access to the API's, the EU did nothing. Thats right, they made a lot of noise, but in the end they did nothing. Unless you consider forcing MS to open a new market and give some of the profit to the EU courts as something to be proud of.
Consider: EU court system charges MS a fine. Why does the EU government get this money? Was MS competing with the EU government? Does anybody believe the majority of this money will end up in the hands of the companies MS was charged with pushing out of the market? So free check for the EU courts. Next the EU courts tell MS that they have to allow others to use their API's, but MS is allowed to charge a royalty. In other words, thanks for the cash, here's a slap on the wrist and a way to make the money back.
So in the end, the companies that MS has forced out of business are still out of business, the API's they wouldn't release before are now released, but still unavailable to those that cannot afford them, and...?
Maybe next time they will consider not bribing themselves and actually making a decision that will actually help the situation, rather than simply making it look as if they had.
Taking money away from MS won't do a thing towards getting them to compete equally. Opening closed standards and imposing financial monitoring would only be a start to forcing free competition, but it would go a lot further than forcing MS to sell access to (some of) the API's.
In the end I think the EU courts basically took a bribe to look the other way. Except where they had the power to really do somehting ere, they were actually the ones that offered and received the bribe, they just made sure the money was coming out of someone elses pocket.
Amount of Fine:As to the arguments about the amount of the fine, it doesn't matter to MS as long as the amount doesn't affect operating costs. The money will be made back simply by not offering as many special deals on software. MS doesn't even have to raise the retail prices, just the wholesale ones (ie, the real price we pay everywhere but Amazon and BestBuy who carge retail and tell us we're getting a deal).
OSS:
No effect. Samba (as an example) hasn't needed the API's this long, and as far as I know they really don't need the Media Player API's. Just a guess.
Whee signature.
You're correct, BiggerIsBetter, but keep in mind that most companies have a lot of Windows server. They see the cost going up, as well as security and reliability problems, so they want to deploy Linux without too much trouble. That's where Samba comes in. Samba allows drop-in replacement of Windows servers. It represents one of the main Linux opportunities that open the door to OSS in corporate and small business shops. Remove Samba and all these Windows shops are effectively trapped into MS forever.
Do you see why Samba is so important and why removing its threat is such a victory for MS?
Optimistic people think that Samba will continue reverse engineering new MS protocols. But the conjunction of patented protocols and for-pay-only specs makes this a shaky proposal from a legal perspective. I doubt Samba can afford long, protracted legal fights. So this stupid EU ruling might well be the weapon that will keep future versions of Samba from being compatible with new Windows protocols.
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