In the latest development of a four-year investigation, European Union antitrust regulators are charging Microsoft (NASDAQ:MSFT) with monopolistic abuses. As the probe winds down, the world's largest software maker faces a large fine, and may also have to give up some trade secrets to its rivals.
EU officials say Microsoft is "leveraging its overwhelmingly dominant position from the PC into low-end servers." Because the company won't disclose information related to how its servers and PCs communicate with rival servers, "an overwhelming majority" of buyers surveyed by the commission said they artificially alter their choice in favor of Microsoft products. The proposed remedy is to force the software king to reveal the interface information so that rival vendors such as Sun Microsystems (NASDAQ:SUNW) and Oracle (NASDAQ:ORCL) are able to compete on a level playing field.
Another issue is Microsoft's practice of bundling Windows Media Player with its dominant operating system software (Windows XP, Windows 2000, etc.). Media Player allows users to listen to music or watch video, and competes with products offered by Real Networks (NASDAQ:RNWK) and Apple (NASDAQ:AAPL). The EU says the fact Media Player is already installed on the vast majority of PCs "weakens competition on the merits, stifles product innovation, and ultimately reduces consumer choice." The remedy would force Mr. Softie to either offer its operating system software without Media Player or to include competitors' versions along with its own.
The EU commission, which says Microsoft's abuses have continued during its investigation, is giving the company one last chance to respond to the charges before it concludes the probe and levies punishment.
