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Deadline Looming for Microsoft in Antitrust Case
gaijincory writes "The International Herald Tribune reminds us that the end of the month is Microsoft's deadline to comply with the European Commission's antitrust ruling. The fine for non-compliance? A cool $5 million per day."
Microsoft has an average daily global sales revenue of $100 million. $5 million is about 5% of their global sales. Their profit margins far exceed 5%, therefore they could continue to pay their daily fine to the E.U. and still make a profit every day.
Also, the E.U. already fined them about $600 million in addition to the prospective daily fine. Thats the same as about four months worth of the daily $5 million fine.
As for the EU's inability to get their member states to vote favorably on the Constitution, many believe this has more to do with Europeans' sentiments about their national leaders which are pushing the Constitution through.
Have you tried reading the draft constitution? Seriously, they need to scrap it and start again. Not because it's bad but because it's barely comprehensible. You can pick bits and pieces you like or dislike and try to sell it on that but trying to sell the thing as a whole is impossible - anyone who pays attention will say "no" simply because they don't understand what they're being asked to agree to.
You might want to do a little reading before spouting off. EU law supercedes the law of member states when the 2 come into conflict. The recent developments in the IR35 debacle in the UK are a fine example.
This is why, as per the article you mention above, there is a lot of dissent among member states about what the constitution is, they are agreeing to that law for themselves.
Further, my understanding is that the policies with regard to monopolies and competition have already been agreed upon, hence, the 'European competition regulator' whose existence is made possible by The Treaty Establishing The European Community, article 81, at least I think it is 81. Either way, there is a list of what is already in play from that treaty with respect to fair competition here.
Take a glance at The EU online, and I would strongly suggest you do a modicum of research before spurting disinformation presented as fact.
People like you piss me off.
Obviously this is up for amendment at any time, but "Although the amount of fine should act as a sufficient deterrent to firms, it may not under any circumstances exceed 10% of their worldwide turnover."
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Sigh, no one ever bothers to read the news:
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http://seattlepi.nwsource.com/business/182966_msf
All those years of paying for growth with new shares is coming back to bite Microsoft. Although the insiders look like they will be able to cash out and leave others holding the bag.
This fine would be major. MS has been cutting a billion or so each quarter over the past year just to meet street numbers and keep the stock from tanking.
The fine is 5% of their global sales, not EU sales. How much does their activities in EU account for?
I don't know, but it may make doing business in EU a cost, or a non/low-profit activity whose sole purpose is to maintain the world dominance.
Staying in EU may then only be motivated by the domino theory: If one country shifts to the "evil" side (that is whatever is oposed to Microsoft) then others will follow.
The alternative for Microsoft is to pass on the bill to the customers increasing the incensitive to using something more economically viable.
The fine mentioned by the EU is up to 5% of Microsoft's worldwide sales (the absolute maximum according to EU law is 10%). As they currently make about 100 million a day, that translates to about 5 million. I expect that more than 5% of their worldwide sales come from the EU, so they probably make more than 5 million a day in Europe.
This is mentioned briefly in the article. Compliance requires basically two things: distribute Windows without the Media Player and document the API or protocols used in some server products so that competitors can create products that can talk to Microsoft's products.
Personally, I am more interested in the second requirement as it could be beneficial to Linux and free/open source software. I also heard that the EU is not happy with the way Microsoft handled that part (restrictive licensing for the documentation) so there is hope that they will force Microsoft to be more open.
-Raphaël
Monopolies are bad for consumers, so the rules change when you're a monopoly.
If I make 1% of all cars on the road, and decide to 'bundle' the cars with a certain roadmap, that's OK. Other mapmakers can still compete, consumers still have choice, that choice allows them to exert pressure on the mapmakers to improve their product. This is how capitalism is supposed to work: consumers vote with their wallets to make producers compete.
If I make 90% of all cars on the road and do the same bundling, other mapmakers are effectively excluded from the market. Consumers no longer have any choice, therefore no way to exert pressure on the mapmaker to improve the product.
As an example, plot the 'growth' in IE. During BrowserWar1 (IE vs Netscape) IE improved in leaps and bounds. Then it was mostly dormant for a few years (except for patches). Now, with BrowserWar2 (IE vs Firefox) IE is being improved again (IE7 is being released with tabbed browsing).
competition = choice = power for consumers = better products
monopoly = no choice = powerless consumers = stagnation
In Denmark they have threathened to fire 800 employees at Navision if software patents are not legalized in Europe.
8 hours x (3000 + (2000 x 34) + 1000) = $576,000
I can't even see how you got $65,400.
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Actually you are wrong. I do not know the exact figure but Microsoft does have $40-$50 Billion in cash.
The term you are looking for is Market Capitalization which is the value of outstanding shares of Microsoft multiplied by the current stock value. Current MSFT has a MarketCap of $278.5 Billion. Change in the Market cap is caused by change in M$ stock price. Investors cause the change, not the other way around. i.e. If investors are pleased with MSFT they bid the stock price up which raises the MarketCap; if investors are unhappy with MSFT the stock price goes down lowering the MarketCap.
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