EU and Microsoft go head-to-head again
Microsoft has been under investigation for tying the browser to Windows for a year. Paul O' Driscoll/Bloomberg
Monday January 19 2009
Microsoft Corp. is facing charges by the European Union that it illegally ties its Internet Explorer browser to its Windows operating system, opening a new front in the long-running legal battle between the two.
The European Commission, the EU’s antitrust authority, said in a statement today that it sent official charges, known as a statement of objections, to Microsoft Jan. 15. The company may be harming consumer choice and product innovation by including its browser with Windows, the EU said.
“For Microsoft, this opens up another chapter of legal drama that will go on for years,” Sid Parakh, an analyst at McAdams Wright Ragen in Seattle, said in an interview today. He recommends buying the stock.
Microsoft, the world’s largest software maker, has been under investigation for tying the browser to Windows for a year. The initial findings will add to years of antitrust wrangling between Microsoft and the commission, which previously ruled the company illegally withheld network data from rivals and bundled a media player with Windows. The commission imposed a record fine of a €497 million in that case.
Redmond, Washington-based Microsoft is studying the finding and plans to respond within two months, the company said today in a statement.
“We are committed to conducting our business in full compliance with European law,” the company said.
Microsoft rose 47 cents, or 2.4 percent, to $19.71 at 4 p.m. New York time on the Nasdaq Stock Market.
Charges
The charges are preliminary and Microsoft can ask for an oral hearing, the EU said. There is no timeframe for a final decision. Companies can be fined up to 10 percent of annual sales for violating EU antitrust rules. Microsoft had revenue of $60 billion in its latest fiscal year.
The commission said tying Explorer to Windows “distorts competition” and gives Microsoft an “artificial distribution advantage which other web browsers are unable to match.”
The EU regulators began the probe following a complaint from rival browser maker Opera Software ASA, based in Oslo. Opera said Microsoft uses its dominant position to prevent consumers from trying Internet browsers made by competitors. (Bloomberg)
