EU Fines for Microsoft Approved, Off the Record

mattaw writes "The Register is carrying a report that all 25 member states of the EU have found Microsoft guilty of non-compliance, off the record. Microsoft is in line for a fine of $2.51 million per day backdated to December 15th 2004 for failing to meet the terms of the EU commission's ruling."

Comments

so?

[geekylinuxkid]

It doesn't really mean all that much. Microsoft will do some kind of wheeling and dealing efforts to 1) lower the fine and 2) establish an even stronger marketshare in the EU such as giving away windows/office/etc to schools, businesses, etc. Sadly, in the end it all works out for redmond.

Re:so?

[Anonymous Coward]

I'm wondering what they should really be doing, besides forcing Microsoft to stop doing business in member states as long as they remain noncompliant, perhaps.

To my mind: enforcing their judgement. MS, along with most American corps basically get to play Cartman in real life. They break every moral, ethical and legal code but when it comes time to pay the piper, a few well placed bribes or a just suggestion that perhaps at some point in the future they might throw a few jobs into someone's constituency and they get off with a pat on the head and a lollipop.

The EU thing has been going on a really long time. I believe that even after they were found to be in violation, they continued with business as usual for over a year while the EU postured with a bunch of empty threats culminating in the "daily fine" threat. Since then, MS has been given ANOTHER eight months or so to get their house in order. If they had done so at any point during that time (eg: after continuing their predatory and arrogant behaviour for an additional two years AFTER being found guilty) they would have STILL gotten their lollipop.

I think that fines are the only stick you've got to use on a corporation. What else would you suggest: throw all the employees and shareholders in jail or just give them a lollipop and ask them to play nice?

Re:so?

[MrFlannel]

Your current computers don't cease to exist (or run, on windows) when you tell them they are no longer allowed to do business.

It will simply force MS to rethink their compliance, or face a whole continent migrating to other operating systems.

Re:so?

[Meltir]

I'm wondering what they should really be doing, besides forcing Microsoft to stop doing business in member states as long as they remain noncompliant, perhaps.

And thats exactly what this is all about.

They cant really force anybody to stop using microsofts products, and they cant force microsoft to completly stop selling their products.

So they gave microsoft some time to prepare documentation that would be available to competitors. For a fee. With no recommendation to give it away, or how much to charge for it. And to this today - microsoft has not yet complied, and are still working on documentation for an OS that was written a couple of years ago.

Every developer worth their money has pre-project documentation, code documentation, end user documentation (for things such as api's and libraries). This has been a standard in the industry for decades. And - most of windows is documented in such a way if said libraries and api's were ever intended to be used by someone out of microsoft. And yet - the others werent, as i seems.

The inner workings of windows and their internall protocols are a mystery even to them.

Thats the only thing that could justify getting a 300 person team for over a year of time.

AND NOT COMPLETING THE TASK!

This only says about the quality of the code - or the obfuscation that they used to actually throw competitors off track.

I remember when the ruling became a very public thing over here at slashdot. Everyone agreed that it was the only thing that the EC could do, and that decision was just.

And now that the fines accumulated to a spectacular (even for microsoft this is a big bag of money which they will have to explain to their shareholders) 1 billion USD, everyone is beggining to feel sorry for them ?!


Sorry - as far as i know they didnt comply, had well over a years time and are still arguing about their case.

I have no sympathy for them. Not that i ever did - but feel free to point out the weeks spots in my understanding of this case.

Disclamer: i am a linux user.

Re:so?

[timeOday]

And that's probably why they levy fines instead of just taking away Microsoft's license to do business. The point of the fines is (ostensibly) not to collect cash, but to force them to change their ways so competitors have a more level playing field. In this case, I believe it's the market for media players in question, and Microsoft was supposed to separate out Windows Media Player. It may sound like a small thing, but with the rise of pay-to-play video on the web, content delivery could easily be one of the biggest markets on the Internet within just a few years.

Similarly, I thought splitting MS Office from MS Windows seemed reasonable. The point being, not to shut anything down, just to require Microsoft to expose their roadmap and APIs enough for other companies to get in the game. Yes, I can see why Microsoft would kick and scream and drag their feet on that. Having a lock on 95% of the market is pretty awesome, just look at their financial reports for the last 15 or so years in a row. But their dominance is not good for the market; not just for competitors, but for consumers (which in this case is mainly other businesses outside the computer industry).

Re:so?

[Ohreally_factor]

No, the non-compliance wasn't about Windows Media Player so much as it was interoperability with other networking software.

MS's attempts at compliance were deemed inadequate even though they protested that it was "too hard" to comply to the degree that the EU wanted. We'll see if it was $1,000,000,000+ too hard.

This fine is more like a contempt of court charge, and doesn't let MS off the hook. They're still expected to comply.

Re:Is it really fair?

[rolfwind]

1. The fine has to be big enough to sway the company receiving it. A billion dollar fine would be overkill for most companies, but MS isn't most companies. Consider that they made much more than this from the European Market in the meantime.

2. And also to be fair, from what I have seen, MS has been bobbing and weaving like an aging boxer to avoid most of the spirit of the rulings. The commission gave them, up to now, 1.5 years to comply. And the company has been dragging its feet in every direction. This didn't come out of the blue.

3. If you think this is harsh, consider that an American judge had ordered to split the company up completely.

BTW, I am not for the commission completely (as I am not pro-EU, the EU tries to get into every aspect of European life which I abhor) but MS doesn't have to do business in Europe. I don't know if this will finally pass but it just has the balls to do what the US Justice Department was too corrupt (from up top) to finish.

Re:Will this really make a difference?

[Salsaman]

judgements like this are the reason windows sells for $300-400 instead of 50-100

Nope. I think you have it the wrong way round. The fact that Microsoft is an (illegally maintained) monopoly, is what *allows* them to sell an operating system for 300 - 400 instead of a more reasonable 50 - 100.

Re:Microsoft doesn't pay anything...

[mdfst13]

"Microsoft, being at the top of the OS market, will simply add the costs of the fines to the price they charge for their OS."

That's not how monopoly pricing works; that's how a perfectly competitive market works. In a perfectly competitive market, adding to the costs increases the price because the price is driven down to the cost (the supply curve). In a monopoly, adding to the costs has zero effect, because price is determined by *demand*. I.e. they sell the OS for the most that they can get already. If they could sell it for more, they already would.

With monopolies, prices are chosen because an increase in price reduces the quantity of sales such that total revenue drops. Similarly, a decrease in price reduces revenue by more than the increased quantity of sales, so that total revenue drops. This fine does not affect that calculation in any way. Therefore, for them to increase prices, they would either have to accept lower revenue or they would have had to have been underpricing their product. I.e. charging less than the market would bear.

Re:So that's...

[Xtifr]

> "what's to stop Microsoft from just saying they aren't going to pay"

My god, did you really just say that? And you even got an "insightful" mod--that's just sad! Microsoft has billions and billions invested in Europe. They have money in European banks, they own property, etc. They don't have the option of refusing to pay! The European governments can, if they want, just take the money! Bam, done! Heck, a billion dollars probably wouldn't even put a noticable dent in their European assets.

And anyway, Microsoft isn't going to fight over what amounts to a slap on the wrist. At least, not if it looks like they're risking losing even more. Even with this fine, Europe is still an incredible, unbelievable source of profit to Microsoft. Collectively, the second largest economy in the world, IIRC. There's no way they're going risk all that money just for this tiny little fine that is more-or-less the equivalent, to them, of some change found under the cushions, to you and me.

FYI: It's mainly about network protocols

[Moraelin]

In this case, I believe it's the market for media players in question, and Microsoft was supposed to separate out Windows Media Player. It may sound like a small thing

Actually, it sounds like a small thing because that's not the whole thing, and it's the least of the non-compliance problems too. MS was basically ordered there to _also_ sell a version without it, which isn't even much of a punishment when they can keep selling the version _with_ Media Player too.

The current fighting is over the other, and more important part there, namely APIs and protocols. MS has been given a list of stuff it must provide adequate documentation for, and to everyone. That's all.

Basically what the EU is saying is "wtf? A situation where only Windows workstations can talk to a Windows server is a recipe for a monopoly. Do be so kind and provide the documentation for those protocols." It's just telling MS that its products should compete with others on their merits, not on being the only thing that can interoperate with their other products. It shouldn't be years of guesswork and reverse engineering just to get a Linux or Solaris box to talk to a Windows server.

And MS so far has been playing hardball and turning it into a media battle. It started by pulling stunts like selling some libraries and docs preferentially and putting some stupid conditions on getting them. (E.g., literally, you can't use them in an OSS product. Literally.) Then it offered a bunch of undocumented and incomplete implementation code. (The EU says: sorry guys, we asked for protocol documentation. Be so kind and provide the docs.) And so on. And, again, it's been busy astroturfing and turning it into a media posing contest.

And IMHO the court has played pretty nice so far. Even the fine is "backdated" and thus so large, because, seriously that was the final date at which MS was ordered to provide those docs. At some point, after giving MS ample time and letting them delay for years, the court basically said, "No, this is final. At date X you must provide those docs or pay a fine per day." It still gave MS more timeouts even after that, and a chance to not pay those fines, but under the explicit condition that, seriously, if MS still doesn't comply than the original date still stands.

Basically, seriously, if I did half that shit in a court of law, I'd be in contempt and probably facing some quality time behind bars. I'm not anti-MS or anything, but at some point a court of law must be able to enforce compliance or it becomes just a joke. You can't allow someone to basically just refuse to obey for years.