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."
Drop in the bucket (Score:5, Interesting)
The fine amounts to slightly more than one percent of Microsoft's roughly $53 billion cash on hand and did not impress analysts and critics.
"This is a traffic ticket for Microsoft," said Thomas Vinje of Clifford Chance, who represents Microsoft critics.
Neil Macehiter, an analyst with London-based technology research firm Ovum, said even a $3 billion fine would have been "an irritant to Microsoft but certainly wouldn't break the bank."
Fines are nice, (Score:3, Interesting)
Doubtful.
just curious (Score:4, Interesting)
or is there some international law that says MS MUST comply?
not a troll, just some questions, as IANAL.
Yay! (Score:4, Interesting)
It almost restores your faith in humanity. Almost.
Re:E500M (Score:5, Interesting)
"This, Windows 98 Super Ultra Deluxe Supremely Cool Second Edition is valued at 250 Million Euros, and thus for our settlement... we give you two copies... enjoy"
Course... that assumes the EU agrees to such terms.
The real question is ... (Score:5, Interesting)
With $53 billion in the coffers, $613 million is a big ol' slap on the wrist.
The problem with Antitrust (Score:5, Interesting)
In other words, the actual software that these laws protects is horrible stuff like RealOne and Quicktime. Open source projects can't afford to license things. I'll be even more impressed than I already am if Mplayer and the like can continue their higher quality in the face of such crappy capitalistic laws.
Re:just curious (Score:3, Interesting)
What about the problem !!! (Score:3, Interesting)
Woo Hoo!!! (Score:2, Interesting)
Pfft, yea right. Like the corperations would ever let that happen.
Check out this Reuters Article. I'm sure you can find it online, it was sent to me via 'business watch'...
If you don't want to read it, here it is in a nutshell: There are seveal processes that exist that will keep the verdict in the court system for up to 7 years before any payout has to occur. By then? Who knows...
March 22, 2004 13:26:00 (ET)
By David Lawsky
BRUSSELS, March 22 (Reuters) -- Microsoft (MSFT,Trade) will win one thing after it loses a landmark EU antitrust case this week -- months and possibly years before it must do what the European Union executive orders, experts said on Monday.
The European Commission is scheduled to rule on Wednesday that Microsoft is an abusive monopolist which used the power of its dominant Windows operating system to damage competitors.
As soon as the ruling is issued, the U.S. software giant will go to court and be assured of months of delay.
Microsoft will be ordered to pay a fine of hundreds of millions of euros, the topic of an advisory committee of EU member states on Monday.
The Commission will order the company to sell a version of its operating system without Windows Media Player and to encourage computers makers to provide other audiovisual software.
And it must license information at a reasonable rate to make the low-level servers of rivals, used for printing and file services, more compatible with Windows desktop machines.
But as Microsoft General Counsel Brad Smith said last week soon after settlement negotiations ended in failure: "Today is just another step in what could be a long process."
Microsoft has always made maximum use of courts to assert its rights and this will be no exception, experts say.
"There are enormous possibilities open to Microsoft to buy time," said David Wood, an antitrust lawyer for Howrey Simon.
The company will appeal the Commission ruling and ask the Court of First Instance to suspend remedies until the underlying case is decided. Until the court decides that first question the remedies are suspended.
BACK BURNER
"If they lose the application to suspend they can appeal that to the European Court of Justice. During that period -- the better part of a year -- it is likely the substantive case will be put on the back burner," Wood said.
The court case itself could take two or three years and an appeal will take an equal amount of time.
The Commission is expected to argue such a long delay will make its remedies irrelevant, because the market will have moved on and it will be too late to stop damage to other companies and to consumers.
Microsoft is expected to argue that if it is forced to carry out the remedies ordered by the Commission it cannot undo them and will suffer irreparable harm.
Some cases move on fast track, if one party agrees to narrow the issues and the Commission agrees to suspend the remedies. But that would pose no advantage for Microsoft.
"Microsoft clearly wants to have the issues examined as fully as possible. This seems to make it unlikely that they would wish to use the fast-track procedure," Wood said.
The worst case for Microsoft is that the remedies would begin to bite once an appeals court ruled they may not be suspended, which could take seven months or more.
The best case is that the remedies would be suspended until the case is finished, which could be seven years or more.
Even if the issues are suspended, the Commission is expected to move full steam ahead on two other investigations of Microsoft for business practices similar to those that got it in trouble this time.
And although the remedies may be suspended, the precedent set by the Commission in labelling Microsoft for its abuse of dominance will not disappear.
"You can expect the Commission to apply the precedent they have in their own decision in comparable cases regardless of whether the court delays the entry into force of their remedies," said Sven Voelcker, an antitrust lawyer with Wilmer, Cutler and Pickering in Brussels.
Re:Nice to see some backbone (Score:4, Interesting)
Compared with the terms of the USDOJ settlement, this is nice to see. Could have the punishment here been harsher? Certainly. Should have it been harsher? Possibly. Is a 500m euro file harsher punishment than a US settlement that allows donations of a monopoly's product in partial lieu of payments? Definitely.
This money ain't gettin' paid. (Score:2, Interesting)
Along the way they'll pay off European business leaders and politicians to continually pressure the courts and the judges.
And, of course, Microsoft could be banking on something that seems to be ever-so-close to happening: the complete dissolution of the EU. Then there will be no one to pay.
Re:Nice to see some backbone (Score:5, Interesting)
Seems to me Microsoft might as well start playing hardball here - Drop the price of an Xbox to $0, offer tracks on the new music service for $0.50, charge $10 or give away copies of Enterprise Architect, take a few high profile clients and offer huge discounts for OS and Office site licenses.
If they don't, they will be accused of being monopolists anyway, leading to more and more fines, (just where does the money from fines go?) and more bad publicity. Since there is now a populist appeal to going after the company, they might as well create counter sentiment buy really becoming popular with consumers.
Microsoft doesn't have a business problem - it has a political problem. Anti-trust cases are inherently political, so we shall see if they learn to play that game. I still don't believe Microsoft is any more of a monopoly than Intel, but Intel knows how to play the game.
Re:Peering into my crystal ball... (Score:4, Interesting)
Windows source code as an asset (Score:5, Interesting)
Microsoft traditionally outsources most of their development, so there is no reason to think that the new company couldn't continue development. Possibly with the same Indian developers as are working on the Microsoft code
Maybe they will even open source it to fix the bugs
What will the EU do with 500M E$ (Score:1, Interesting)
Re:Typical Europeans (Score:3, Interesting)
- All your BMW and Mercedes cars
- The jet engines from your aircraft (invented by Sir Frank Whittle in Britain in 1945)
You seem to be under the misguided impression that Britain actually enjoys being part of Europe.
Last time there was a poll on the matter (by The Sun), the majority of people in the UK wanted to be part of the US more than they wanted to be part of Europe.
Re:Drop in the bucket (Score:4, Interesting)
You must not drive around Seattle much. =)
However, this analogy is rather apt; in (Montana I believe) the cops are allowed to collect speeding tickets on the spot in the form of cash. People have taken to keeping a fifty on the dash so that they can speed through the state, and just pay the fine if they get caught (I don't blame them).
This settlement amounts to the same thing - as long as you have the cash, keep doing what you've been doing.
True enough but this is a traffic ticket to B.Gate (Score:4, Interesting)
A fine should at least make it unprofitable for me to commit the crime again. If I stole 1 million and was fined 1000 then that is not exactly going to stop me is it? So how much did MS make by violating the law? More then 500 million? Then they ain't gonna stop.
Re:just curious (Score:1, Interesting)
A suggestion in that case: Germany, UK, France, Italy and Spain each chip in one billion euro, and with that money they buy Apple Computer. MacOS X is ported to x86 within 6 months and made open source. Lets say 200 million tax payers, that makes about 25 Euro per tax payer. Alternatively, IBM gets a contract to make LOTS of 970s, and Apple provides every government agency in Europe with eMacs at cost. I guess you could build 20 million identical eMacs at $300 each easily if you leave out everything that is non-essential.
Bye bye, Microsoft. Bye, bye, Intel.
Re:It's not about putting them out of business. (Score:1, Interesting)
If I remember my history class correctly, that was fairly common practice back in Rome, to fund the government by liquidating rich people...
Re:Inapproriate? Hardly. (Score:3, Interesting)
In the real world, companies have to operate under the laws of every country they operate in. If you open up a Saudi Arabian branch of your company, you can't make advertisements there with scantily-clad women, and complain when the Religious Police shut down your operations there that these ads are allowed in the US.
What happens to the cash??!! (Score:5, Interesting)
This is where the real damage to MS could occur, if the penalty cash is dished out to the right FLOSS projects that threatens MS directly.
Proposed split based on what I think would help FLOSS and hurt MS:
50million for the Linux Kernel to get their security certifications finished for govt usage, driver improvements to the kernel, SE-Linux integration, whatever else Linus wants
50million for Apache Webserver, Tomcat, and other Apache-based projects that really eat into IIS market share
25million for OpenOffice with a focus on compatibility with MS Office.
25million for GNOME & KDE, split evenly on whatever they want, but with a preference on creating a Win2k-style desktop emulator so the riff-raff can change their screensavers like before
10million for plug-ins/features into Eclipse IDE that help emulate the best features of Visual Studio, and better integration of non-Java languages like Perl, PHP, C#/Mono, etc
10million on Bitkeeper replacement and/or Subversion to get great source code control mgmt, tied into Eclipse IDE enhancements above
10million on modeling tools for code or databases like SQL Navigator, or Rational Rose
10million for PHP on whatever they think they need
10million for Wine to get us closer to running lots of apps on non-MS Operating systems
10Million for ***BSD Flavors [Just because they have created so much with so little
10million for RMS and GNU with the promise he wont complain about everyone else's cash allotment
AND
25million for an investment fund that donates 50% of the yearly profits as grants to future promising FLOSS projects
Comment removed (Score:5, Interesting)
Re:Peering into my crystal ball... (Score:5, Interesting)
CORRECTION: Once you include the cost for Iraq, the US military budget is greater than all the worlds military budgets combined. [cdi.org] The USA=$399 Billion plus the $75 to $100 billion in Iraq is to be determined; versus the rest of the world with at $463 billion.
US money - Europe (Score:3, Interesting)
We have pretty significant trade deficits already.
from http://money.cnn.com/2003/02/20/news/economy/trad
"Exports to Western Europe slipped to the lowest level since 1997"
"On an individual country basis, the U.S. trade deficit with Germany set a record in December at $4.1 billion, fueled by a record $6.3 billion in imports"
some relevant quotes from 2002 (Score:2, Interesting)
Every time MS has to pay out... (Score:3, Interesting)
Well, chump change adds up.
Add this money to the payouts that have come before it, and the ones that will come in the future.
Re:Drop in the bucket (Score:3, Interesting)
And the real number is more like 100billion, which would be a reasonable fine, they simple lose the profit they made breaking the law. Having already spent some of their illgotten gains is their own problem. Now 100billion of course wouldn't bankrupt microsoft who already has something to the tune of 80billion in cash reserves. But it would cause them to have to restructure and liquidate assets, it would be a blow to their buisness but not a death blow. A mere 600mil isn't even a sneeze.
If I make $10/minute, and save 10minutes by speeding to work, that's $100. Now lets say I get a ticket everyday for $50 (this is showing a concept, dont' pull out the anal details like the time it takes to get the ticket). I'm still profiting by $50/day by breaking the law. As long as I come out ahead, why the hell would I stop?
This is more like a tax than a fine, the EU is saying they want a cut.
Re:What happens to the cash??!! (Score:2, Interesting)
Re:Peering into my crystal ball... (Score:2, Interesting)
Europe could have just as well been Mars to most people back then.
This is probably going to sound trollish but, most Americans still have the mindset that "These people can't take care of themselves, so we have to do it for them." They've been given little reason to think otherwise.
Jaysyn
Re:What happens to the cash??!! (Score:2, Interesting)
Samba needs 25 million for compatibility testing, tight integration with OpenLDAP, a nice hand-holding GUI install, slick GUI to manage users, groups, printers, etc like Win2K networks, and Active Directory replacement (hence the OpenLDAP integration request).
Re:Oh, please... (Score:1, Interesting)