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Antitrust regulators back European Commission's ruling on Microsoft

The ruling could be made public by the end of the month

By Paul Meller
March 15, 2004 12:00 PM ET

IDG News Service - Antitrust regulators from the 15 European Union countries have unanimously backed the European Commission's ruling against Microsoft Corp., a commission spokeswoman said.
The advisory committee meeting of the 15 national regulators broke up early today, spokeswoman Amelia Torres said.
"The meeting is over. The member states have unanimously backed the commission's draft decision," she said.
In less than two weeks, barring a last-minute settlement, the commission will declare Microsoft an abusive monopolist, impose a fine of $100 million to $1 billion and order the company to make fundamental changes to the way it sells software in Europe.
Microsoft gave no reaction to the advisory committee result. Spokesman Tom Brookes said the company is still pursuing a settlement.
Computer industry analysts said the most important aspect of a ruling against Microsoft would concern how the company sells its music- and video-playing software program, Media Player.
The commission is expected to demand that the company sell two versions of its Windows operating system to PC manufacturers, one with Media Player bundled, and one with the program stripped out.
The commission believes that by bundling Media Player into Windows, Microsoft is abusing the dominance of the operating system, which sits on more than 95% of PCs in the world, to the detriment of competitors such as RealNetworks Inc. and Apple Computer Inc.'s QuickTime.
"Media Player is an integral part in Microsoft's longer-term strategy for Windows," Goldman Sachs & Co. said in a recent research note to investors, adding that it's likely to resist removing Media Player from Windows. Microsoft "may refuse to settle [this issue], electing to challenge this in court," the brokerage said.
An appeal of a negative ruling to the European Court of First Instance in Luxembourg would take at least three years to conclude. In the meantime, the court may turn down Microsoft's certain request to suspend the remedies until after the appeal, forcing the company to change the way it does business in Europe almost immediately.

Microsoft doesn't break out sales figures for each region in which it operates, but analysts believe the EU accounts for just under 30% of the roughly $10 billion in annual revenue the company generates from Windows worldwide.
Microsoft lawyers in the past have said that any remedy imposed on its operations in Europe might be extended to all Windows programs in all regions of the world, including the U.S. But recent developments have led some analysts to believe that a ruling against Microsoft in Europe could be limited to that region only.
Dan Kusnetzky, an analyst at research firm IDC, said that in recent weeks

Reprinted with permission from Story copyright 2014 International Data Group. All rights reserved.
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