EC promises Microsoft anti-trust fight will continue

The European Commission has said it will pursue its anti-trust case against Microsoft despite the loss of two of the Commission's principal supporters from the IT industry.

On Monday, Microsoft said it had reached separate settlements with Novell and the Computer and Communications Industry Association (CCIA), resulting in their withdrawal from the Commission's ongoing litigation.

In March, the European Competition Commission fined Microsoft a record 497 million euros for abusing its dominant market position in operating systems. The Commission also ordered Microsoft to ship a version of Windows without bundled media players and to license protocols that would allow competitors to integrate their servers with Microsoft desktop systems.

Microsoft is challenging the rulings, while the Commission is fighting to see its remedies implemented immediately - avoiding a possible delay of several years while the larger legal battle plays itself out. In an appeals hearing at the end of August at the EU's Court of First Instance (CFI), Novell and the CCIA were, with RealNetworks, two of the most dogged supporters of the Commission's case. Microsoft previously reached settlements with Sun and AOL.

With their withdrawal from the proceedings, RealNetworks is the only significant industry backer for the Commission. On Monday, following its announcement of the two settlements, Microsoft general counsel Brad Smith told the New York Times that there is now "clearly less need" for the Commission to press on with its case.

The Commission responded harshly, saying the actions of Novell and the CCIA are irrelevant, and that its aim is not to uphold the interests of Microsoft's competitors, but those of consumers, by ensuring competition.

The settlements "don't change any elements of Microsoft's conduct in the market," said Commission spokeswoman Amelia Torres, in a statement, and they "do not alter the necessity for immediate implementation of the remedies in order to restore effective competition".

A decision by the CFI is due this month, but whatever the result an appeal is likely. The appeal will be heard by the EU's highest court, the European Court of Justice (ECJ). If the ECJ also denies Microsoft's appeal, Microsoft has said it is prepared to carry out the remedies, which include selling a version of Windows XP without requiring manufacturers to use a particular media player.

The commission is to continue a separate investigation into Windows XP, which was sparked by a complaint by the CCIA. RealNetworks said it will continue supporting the Commission's case, and said it isn't in settlement talks with Microsoft. Novell said that although it has dropped litigation regarding its operating system, NetWare, it will continue to pursue Microsoft in a competition case involving Novell's WordPerfect word processor.

On Tuesday, Nokia quit the CCIA, saying it disagreed with the way the group settled its differences with Microsoft. Nokia has been one of Microsoft's most entrenched competitors, because of its significant stake in Symbian, which makes the most popular smartphone operating system. Microsoft makes a Windows CE-based smartphone operating system.

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Copyright © 2004 IDG Communications, Inc.

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