Microsoft To Be Fined E500M By European Union? 1029
An anonymous reader writes "According to a Reuters story, the European Commission is in the process of fining Microsoft 497 million Euros ($613 million). The most important reason for the fine was the refusal by Microsoft to share more information about its products with competitors. Mario Monti, the EU competition commissioner, decided to impose the fine after talks with Microsoft broke down last week." The last estimate was a mere 100 million Euros, and it's noted: "If the full European Commission backs the fine as expected on Wednesday it would exceed the 462 million euro penalty imposed on Hoffman-La Roche AG in 2001 for being ringleader of a vitamin cartel."
Nice to see some backbone (Score:4, Insightful)
At this rate.... (Score:2, Insightful)
Change (Score:2, Insightful)
Re:just curious (Score:3, Insightful)
Re:Fines are nice, (Score:3, Insightful)
Sigh.... (Score:5, Insightful)
Where does this money go? (Score:5, Insightful)
And he'd be right about WMD (Score:3, Insightful)
Re:Peering into my crystal ball... (Score:3, Insightful)
As for the verdict, having things go through courts all over the nation has good and bad consequences. Sure, the fine is a Good Thing because Microsoft deserves to be fined, since they ripped people off and have engaged in unfair, illegal competitive practices, and W's administration did not allow them to be brought to justice. But Microsoft, at the same time, is using international courts in its assault against Lindows (aka Lin----), which I would say is a Bad Thing.
It's not about putting them out of business. (Score:5, Insightful)
If Microsoft doesn't change its practices, we can see more fines such as this. Eventually, Microsoft will change.
Re:At this rate.... (Score:5, Insightful)
It is one thing to aim for fairness, it is another thing to just be blinded by hate.
Re:just curious (Score:5, Insightful)
Yes. And also give up what 30-40% of their bottom-line.. Which is a LOT more than that puny fee.
but who would be more injured by such a move, MS or the EU?
Microsoft would be killed by it. Several hundred million europeans would be forced to switch OS and application software.
That'd get the Linux ball rolling, and how!
Re:just curious (Score:5, Insightful)
Re:Yay! Tax rebates! (Score:2, Insightful)
I would prefer that we spend it on Space exploration, or even better, fund Open Source development to the tune of 500M euros... that would give some nice returns for the planet.
To be fair though, it should probably be spent on the 10 ex-soviet (and other) countries that are joining the EU in May... perhaps a moving in present (50Million euros investment in the infrastructure of each country would go a long way since their average income is relatively low).
Re:Peering into my crystal ball... (Score:2, Insightful)
I don't see where the parent likens Bush to Hitler. Just because Bush isn't as bad as Hitler was, doesn't mean that Bush is a good president. Your argument is fallacious at best.
The real penalty (Score:4, Insightful)
Why can't I post with named character entities? (Score:0, Insightful)
Y'know, people should normally be able to write: "€" and get a real euro symbol, instead of having to using "E".
But it doesn't seem to work on /.
Does anyone know why all named character entities seem to get stripped out when I submit /. articles (using "HTML Formatted", of course).
Inapproriate? Hardly. (Score:5, Insightful)
I'm sorry, but if you trade into the EU, then you are expected to obey the laws of that market. Doesn't matter where the head office is. I'd have thought that Bill would employ lawyers with a clue - at least enough of a clue not to make a stupid statement like this.
Re:Drop in the bucket (Score:5, Insightful)
Well, yes, and it's probably intended to be. Traffic tickets are not intended to end life as you know it, nor would a regulatory fine be intended to put a company out of business. Monopoly or not, it would not be in the EU's best interests for Microsoft to suddenly go belly up, or to abandon the European market because it's become unprofitable, thereby leaving all those currently using MS software in the lurch, support-wise, and out of all their license money that's guaranteed them future upgrades.
The "slap on the wrist" analogy is often used to show that a penalty is too light, but in fact the whole point of a slap on the wrist is to get your attention and change your way of thinking and acting. Traffic tickets do not usually bankrupt anybody but hopefully they will get you to follow the law. They are an annoyance and one that most people would rather not deal with. And the only real way you eliminate the risk of receiving one is by obeying the law.
So if this is seen as a traffic ticket, good. The penalty will have done its job.
613 Million is a joke to Microsoft (Score:3, Insightful)
Re:Still chump change (Score:2, Insightful)
Re:The problem with Antitrust (Score:1, Insightful)
Re:Nice to see some backbone (Score:1, Insightful)
Don't kid yourself -- Microsoft would much rather pay a E500M fine than have their monopolistic tactics curtailed. And this crap about removing Media Player? - blah, nobody will care.
Re:Backtracking (Score:5, Insightful)
For being a monopoly. Or rather, using their monopoly position to leverage themselves against competitors.
Spending millions of dollars to develop IE which was then distributed free with Windows pushed Netscape out of the browser business fast.
Now they're trying to do the same with AIM, Real, iTunes, well, you name it!
Doing that kind of stuff is not legal in the USA, nor is it legal in any western country. And for good reason: Monopoly practices are bad for everybody except the monopolist.
It's damaging to the economy. It's damaging for consumers.
Or to put it another way: Capitalism is it's own worst enemy.
(and that was pretty much agreed upon until certain politicans realized that big businesses had bigger pockets for campaign spending)
Cash Stream for EU (Score:1, Insightful)
Re:The problem with Antitrust (Score:3, Insightful)
Given that it takes over the MIME type for (amongst other things) PNG images when it installs on Windows, and their implementation is more broken than IE's implementation, I'd consider it "horrible stuff".
Who'd get the money? (Score:3, Insightful)
Think of it as affirmative action for European tech companies that were kept down by "the man." This could help equalize the playing field again!
Re:Sigh.... (Score:5, Insightful)
Well, actually governments are already dictating to motor companies how they should design and manufacture their cars (by enforcing safety and emission standards). In a similar manner they also dictate to electronic companies how they should design and manufacture their appliances (once again, by enforcing standards), and the list of the things they are dictating to construction companies is endless. So... what is so strange, actually, in government-enforced standards in computing? I think it is inevitable, sooner or later. The old joke "what if Microsoft build cars" [brocku.ca] has a grain of truth in it. Unlike cars, there are no mandatory crash tests for software. And it shows.
Re:Drop in the bucket (Score:2, Insightful)
Very true. However traffic tickets also work because they accumulate. Lots of people shrug at the first one, and only get worked up (usually about 'government thieves' rather than their own law breaking) when they get their nth ticket.
What I'm trying to say is: a) the more important part is still the rest of the verdict and b) how soon could a simmilar fine be impossed if MS continues to break rules (which they'll undoubtbly do)? If it's next year, the fine seems usable. If it is in 10 years, not so much.
historically speaking (Score:4, Insightful)
You're missing the point (Score:5, Insightful)
It's not chump change. It's a small but significant dent, which they've unceremoniously been given in spite of Ballmer's best efforts to talk the authorities down last week.
It's also widely rumoured to be accompanied by (a) a compulsion to ship a version of Windows with Media Player completely stripped out, in order to remove the artificial dominance Microsoft has secured over the multimedia world, and (b) heavy penalty conditions if Microsoft gets up to this stuff again, so lengthy court action can be replaced by abruptly hitting them when they're down. These are, for now, only rumours, since the ruling won't be made public until later this week. However, no-one's jumping up and down denying them, and it's well known that all the European parties and Microsoft have seen that ruling. Draw any conclusions from that you like, or wait to see for sure mid-week.
At any rate, this isn't meant to kill Microsoft. It's meant to make them behave, and to reopen competition in the marketplace for the benefit of the public. In that respect, it seems fairly well judged, assuming the above rumours are reasonably accurate.
other options (Score:5, Insightful)
Fines are a weak response, as it has been stated over again, this is piss in a pond to the likes of Microsoft.
On the other hand, the European Commission has the power under Article 81 and 82 of the EC Treaty (which where anti-competitive behaviour is prohibited) to impose structural remedies: to insist upon corporate re-organisation or say an order to disclose information or to unbundle software. This would be a far more appropriate remedy that would actually be economically useful rather than a bit more cash in the bank for EU.
If the commission really has spine, it will seek this type of remedy rather than the easy way out. It may in fact seek a combination of fines and structural remedy, so we'll just have to wait and see.
Re:just curious (Score:3, Insightful)
The European market is about the same size as the US one at least in terms of overall size. So they are not just going to say bye to that...
but who would be more injured by such a move, MS or the EU?
Microsoft. By a loooooong way.
Re:Peering into my crystal ball... (Score:2, Insightful)
Lets flesh this out (Score:3, Insightful)
In your normal business environment, people compete for your business. They advertise, market, and change prices in order to try to do better than their competitors.
The problem is a monopoly by definition has no competitors. Lets say you have a company which has agressively marketed RAM chips. You cut costs and make deals. This drives all the competitors out of the market and they close their doors. You now have a natural monopoly. This sometimes happens, and the government has to recognize it. If you are a natural monopoly, you fall under new rules because you have no competition.
For example, as a monopoly, say you go to some PC manufacturer and demand they have to pay twice what they pay now? As a monopoly, the PC manufacturer has no recourse and you are now bullying them. Not fair, and illegal as a monopoly. If you had competition, and you did that to someone, the PC manufacturer would laugh their ass off and switch to another RAM provider. This is one example of general "price fixing."
There are other examples, but that's the general idea. Competition means you have to fight to keep your customers. A monopoly means you can bully your customers in a way that's not fair to them. In general, competition is good because competition is the check against unfairness. This is why there is lots of talk about mergers and huge conglomerates who have too much control. Too much control is generally BAD, because the more control you have, the more prices you can fix. Most companies do more convoluted price fixing of sorts these days because that makes it harder to get caught.
Something else that Microsoft did is give away their IE browser for free. Netscape had a browser which eventually cost money and people had to buy. IE stepped in and leveraged their current monopoly by giving away IE. They made huge amounts of money on the OS and office, but made IE attractive by making it free. This is like owning all the oil in the world and giving away a free car when someone buys enough of your oil. The oil may be marked up astronomically, but hey, free car! This will drive the competition for cars into the gutter as their cars still require oil.
Note its also illegal in the US for companies to work together directly to fix prices.
Thus ends the lesson.
If they could charge more, why aren't they? (Score:3, Insightful)
Monopolies charge what the market will bear. This fine doesn't impact what the market will bear, so it shouldn't affect prices. Monopolies set prices at the level where any increase in price would decrease profits. They have no incentive to set it lower, and it would be stupid to set it higher (as it would decrease profits).
Think of it from the other perspective. If a company received a sudden windfall of money, would you expect them to reduce prices? No, they would take the windfall and maximize profit with current prices. Giving the windfall a negative value doesn't change anything but the level of profit. The company will still set prices and production so as to maximize profit.
Re:Oh, please... (Score:5, Insightful)
That's quite a logical leap in four years. It's possible that Iraq developed the aforementioned weapons in four years, but based on what the troops found in the country, such a program would be in its infancy at best.
Re:Typical Europeans (Score:1, Insightful)
I'm guessing you've never heard of Gottlieb Daimler nor Karl Bens, eh?
"Death to all" mindset. (Score:1, Insightful)
It is one thing to aim for fairness, it is another thing to just be blinded by hate.
Yeah really. To think that the only punishment for any crime or even mere infringement is so... hmmm, what's the word I'm looking for... so islamic.
Hey, they broke the law.. (Score:3, Insightful)
Something tells me that the fine was worth it to them, an 'acceptable loss' to hold on to the market.
This field is not so young. (Score:1, Insightful)
Re:Peering into my crystal ball... (Score:5, Insightful)
Only another 82 fines like this ... (Score:2, Insightful)
$50b / $613m ~= 82, or 1.2% of their on-hand CASH.
The price of doing business (Score:5, Insightful)
They have $50 Billion dollars in cash. 1% of one's cash reserves (never mind revenues) is simply not a punishment.
Imagine being taxed one percent of your life savings for a license to break all the laws you like. That sounds like a pretty sweet deal to me.
The problem with fines is that business already thinks in terms of money. Punishments for breaking the law are intended to deter behaviour. Fines are instead framed by the company as just the cost of doing business.
Re:Oh, please... (Score:0, Insightful)
I can't understand all the people who oppose the war because - the weapon programs we're only in their infancy - or he was only TRYING to aquire WMD.
I own a home. I destroy hornets nests BEFORE they are complete. I don't wait for the buggers to finish first!
Oh well, if only the US would stand down would we have peace in our times.
Oversimplification and exaggeration (Score:3, Insightful)
I'm not saying that fully open file formats wouldn't help - just that they are not necessarily the central issue.
Having MS release their file formats (and Client-Server communication protocols) as an open standard would restore the Free Market
Not really. For example, MS could safely release all of the WMP codecs and formats and still crush the "free market" in players by distributing a free player tied to its OS - that's why WMP is still an issue on the table with the EU folk.
Closed formats are one piece in a big puzzle. There are many other possibilities for MS to abuse.
Having MS release their file formats (and Client-Server communication protocols) as an open standard would restore the Free Market.
To a certain extent, they have.
In reality, there won't be big changes in the desktop market until Linux (or someone else) steps in with a significantly better, polished product, or until some government royally tromps MS with a motion intended to bust. I don't see the US doing the busting (economically unsound), and the EU likely realizes that serious action has a good chance of sparking a trade war.
Even if MS halted all "bad behavior", their monopoly would continue for some time. As such, we'll have to wait for the slow progress of open software OS's to bash things back open.
Re:True enough but this is a traffic ticket to B.G (Score:4, Insightful)
Yes, this is exactly the problem. Where I live, there is a suburb that has repeatedly dumped raw sewage into the river that runs through the city rather than send it to a waste processing facility because the EPA fine is less than the cost of the treatment. There is no incentive for the city to stop doing this as long as it costs less.
The same analogy applies to Microsoft. If they make more by squeezing out the competition unfairly than they lose in fines, it's still a net gain for them overall and the next time around, there's fewer players to have to squeeze out. It's a win-win for them and a lose for everyone else (except the custodians of the fine money, it seems).
Comment removed (Score:3, Insightful)
Doubt it (Score:4, Insightful)
I'm pretty sure that would be a violation of international law. I don't believe there's anything in international law that allows governments to seize copyrights as remediation in lieu of fines. I'm also pretty sure that MS made it so that no one who participates in Shared Source can do anything worth a damn for similar reasons as you outline.
Silence (Score:4, Insightful)
Re:This is not courage, it is GREED (Score:1, Insightful)
Re:It's not about putting them out of business. (Score:4, Insightful)
OK, but do we really want to give politicians, that most organized cadre of criminals, the idea that they can raise funds by fining companines?
You can't put a company in jail, so how else do you make it behave except to take the one thing (money) that matters to the company? Microsoft has been publicly wrist-slapped in the past with no apparent result. I still prefer the rule of our elected officials to the rule of our unelected corporate overlords.
How will this help? (Score:2, Insightful)
What should REALLY happen to Microsoft:
1: The company should be split into two, one that sells Windows, and one that sells all of the Applications and addons like Office, IE, Windows Media, MicroTunes, etc. These companies should have no financial relationship with each other except:
2: The OS company should be forced to lower their prices by however much the App company charges for the unbundled pieces. For example, if the App company charges $19.95 for Windows Media, Windows itself should get cheaper by that amount. Think what that would mean for IE! If the App company wants anyone to buy their browser over free options like Mozilla, it really needs to be better than Mozilla. Wow. Competition based on merit....
3: The App company should have to freely publish their file formats. When everyone who has a word processor or spreadsheet application can easily read and write the Office formats, users won't be forced to use Microsoft products if they don't want to. If the products REALLY ARE better, people will use them, but not because they have to.
None of these thing should be objectionable to Microsoft if they actually have the best products and can legitimately compete on the basis of merit.
I know, it'll never happen.
-John
Re:Peering into my crystal ball... (Score:3, Insightful)
Re:-1, Self-flagellating (Score:2, Insightful)
No one is coming to YOU personally for help for anything. You have no power. Your "don't come to us" really means "don't come to the powerful folks in my country's government who probably won't even talk to me if they saw me in the street".
Please go back to your troll-cave.
Thanks.
Bye bye.
Alternatives (Score:2, Insightful)
Re:US money - Europe (Score:2, Insightful)
It's only fair that they should obey the local laws.
Think of it this way - if you are a worker (selling your labor) in a foreign country, you should still obey that country's laws. And if you park illegally on your neighbour's lawn, you will be fined.
Re:Peering into my crystal ball... (Score:5, Insightful)
Even if so-and-so did something really wrong decades ago, how does that apply to any of us living today anyway? Most Americans disagree on tons of issues... and the same applies to Europeans. Generalizing the will of either "side" into what dumb politicians say is unfair to both.
How about we just talk about our common interests like computers instead of showing too much misplaced nationalistic pride?
Re:US money - Europe (Score:3, Insightful)
I can see that the Anti MS sentiment is strong enough for everyone to overlook this, but doesn't it seem a bit unfortunate for half a billion US dollars to fly off to fill some European government treasury?
Microsoft have been abusing their monopoly for years to the detriment of European citizens. Those "half billion US dollars" don't all come from the USA you know. Next time you see a "Windows worm estimated to have caused XXX kajillion dollars in damages", please remember that those worms don't just affect USA companies. Next time you see Microsoft kill competition by bundling applications with their operating system (virus scanners next, right?), remember that some of those companies were European.
Re:Peering into my crystal ball... (Score:3, Insightful)
Re:Drop in the bucket (Score:3, Insightful)
It is also very much about customer perception. If Microsoft have to pay a fine that is higher than what most companies could have afforded, they will realize that Microsoft is not sent by God, and will be much more aware of Microsoft strong arming tactics when and where they show up.
This could be much more costly to Microsoft than the fine itself. Especially now when Linux starts to emerge as a vialble alternative in many situations.
Re:Peering into my crystal ball... (Score:2, Insightful)
Re:Peering into my crystal ball... (Score:2, Insightful)
Some more info on Bush's ideals and vision for 'world leadership': http://www.newamericancentury.org/ [newamericancentury.org].
Re:Peering into my crystal ball... (Score:1, Insightful)
Re:Peering into my crystal ball... (Score:3, Insightful)
Nope. These are hardly Hitler's worst evils. Any way you spin it, comparing Bush with Hitler is obviously preposterous. It should only take a few minutes of thought and use of common knowledge to notice the gigantic differences between the two men. I'm sure you're smart and educated enough to know them already, but just aren't bothering to seriously think about the issue. I would be insulting your intelligence if I took the time to enumerate them for you. I encourage you to just think of 5 ways in which Hitler is worse than Bush. After this, can you really come back after that and tell me again that they're comparable?
Don't get me wrong, I strongly oppose Bush myself. But extreme comparisons like this only serve to discredit those who oppose Bush for sensible policy reasons.
Comment removed (Score:2, Insightful)
Re:Oh, please... (Score:5, Insightful)
Bush had different policy goals. He wanted to invade and occupy iraq and was not content to merely contain saddam. His motivations were complex (oil, his father, biblical prophecy, US hegemony etc) but he knew from day one that he wanted to control iraq totally and absolutely. He too accomplished what he wanted even though it cost lots of money and lots of lives.
In the end both Clinton and Bush were looking out for their own interests. The interests of the Iraqis was and remains totally irrelevent.
If Bush had stood up before 9/11 and said "The US will use it's wealth, power and military might to end opression in the world and to destroy all dictators" I would be lining up to give him money and support. If he had said "we will deliver democracy to everybody and free everybody from the chains of opression and bondage no matter what it costs in lives and money" I would walk around my town begging people to vote for him.
He didn't say that because that's never been his goal. He will not lift a finger to deliver freedom to chechnians, palestenians, africans, tibetians, chinese, and the tens of millions of people suffering all over the world because they don't have something he wants.
I am still waiting for somebody (anybody) to explain to me why the Iraqi people deserved socialism more then any other people on the planet. Why they had to be delivered from evil first. It seems to me that your average north korean is and has been much more opressed. The average chechnians is much poorer, the average east timorese has suffered much more death and bloodshed, the average tibetians much more misery and ethnic cleansing. Too bad none of them have oil, too bad the bible makes no mention of them, too bad none of their leaders tried to kill his father.
Re:Oh, please... (Score:2, Insightful)
yeah (Score:2, Insightful)
It's always so cool to see how the USA condemns countries with WMD, after they delivered the means to these countries to develop them in the first place.
Or how they invade and sanction countries that have WMD - while having WMD themselves, ofcourse, exept Isreal, Pakistan and India. But only when it suits them, ofcourse, because let's not forget they DID imose sanctions on the latter two, untill they did the bidding of Bush and his cronies.
Or the USA much uplifting struggle for freedom and democracy in the world, while supporting ruthless dictators and human-rights-abusing monarchies...as long as it is to the economic and political benefit of the USA, of course.
Re:Peering into my crystal ball... (Score:1, Insightful)
Now if you take into consideration the EU's budget on Free healthcare on top of the military I am sure you get vastly different numbers.
If I was you I would be ashamed to mention the astronomical amount of money the US spends on it's military when you have to pay to be seen by a doctor. I know I would.