EU Takes a Bite of Microsoft

The European Union will have the pound of flesh, thank you. And could you serve it raw, please? After all, everyone should enjoy Microsoft (Nasdaq: MSFT  ) a la tartare, right? Sure, it's fun to see the IT industry's hubristic Goliath take a few lumps now and then, but the EU's squabble with the Microsoft over something as trivial as the packaging of media-player software still seems petty and misguided.

As you may recall, these two economic superpowers have been locked in a five-year antitrust battle. In the abstract, the issue was whether Microsoft abuses its monopoly on the market for operating systems by competing unfairly against other software firms.

In fact, everything seems to boil down to media-player software. The EU maintains that Microsoft's mere bundling of its Windows Media Player together with the Windows OS constitutes abusive monopolistic behavior. In response, the firm had offered to include with the OS a separate disc containing rival media applications, such as Apple's (Nasdaq: AAPL  ) iTunes and QuickTime, RealNetworks' (Nasdaq: RNWK  ) RealRhapsody, and Roxio's (Nasdaq: ROXI  ) Napster -- which was recently rumored to be in cahoots with Microsoft.

The EU responded that it would be too much to ask Europeans to use a separate install disk. (My own thoughts on that matter are summed up by a favorite quip from Dr. Evil: "Boo-friggity-hoo.")

The official ruling is still under wraps, but widely leaked details report the levying of a $100 million to $1 billion fine on Microsoft, and an order to sell two separate versions of its OS, one without Media Player.

It gets even sillier. According to sources quoted by TheNew York Times, the commission will order that Microsoft "must not do anything which would make a bundled version of Windows more attractive to PC makers than an unbundled one." Presumably, that would forbid everything from a price break to a little sticker saying "Windows Media Player Included: Save Yourself the Download Time."

In the end, neither remedy will put much hurt on the company's beefy bottom line. Hopefully, Microsoft will just put this issue to rest and move on.

What do you think of the issue? Discuss it in the Fool's Microsoft discussion board.

Fool contributor Seth Jayson thinks the EU could spend its resources on bigger issues. He owns no stake in any company mentioned above. View his Fool profile here.