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Microsoft agrees to comply with EU antitrust decision

The US software giant Microsoft agreed to fully comply with an antitrust decision by the European Union in 2004, the European Commission announced on Monday.

“I want to report to you today that Microsoft has finally agreed to comply with its obligations under the 2004 commission decision,” EU Competition Commissioner Neelie Kroes told reporters on Monday. Microsoft will now take the necessary steps to comply with its obligations under the commission’s 2004 decision regarding work group server operating systems and make available to “open source” software developers the interoperability information, the commission said in a statement. The interoperability information will allow software developers to make their programs work smoothly with Microsoft’s Windows operating system.

In its 2004 decision, the EU’s antitrust watchdog ordered Microsoft to supply competitors in the work group server operating system market with interface information necessary for their products to communicate with its Windows operating system and untie Windows from its own Media Player product. The commission also fined Microsoft a record €497 million (about $686 million) for the company’s abuses of market power. Microsoft’s concession came after the European Court of First Instance, the EU’s second-highest court, upheld the commission’s decision last month, a heavy blow to the software giant’s long-time defiance. During the three-year legal battle, Microsoft released a Windows version without Media Player on the European market in 2005. But the European Commission found this also failed to disclose the interoperability information and issued a new fine of €280.5 million (about $398.3 million) in 2006.

Earlier this year, the commission warned Microsoft of further penalties of up to €3 million (about $4.2 million) per day over its unreasonable pricing of the interoperability information. The commission said Microsoft finally agreed to comply with three substantial changes.
First, “open source” software developers will be able to access and use the interoperability information.
Second, the royalties payable for this information will be reduced to a nominal one-off payment of €10,000.
Third, the royalties for a worldwide license including patents will be reduced from 5.95% to 0.4% - less than 7% of the royalties originally claimed.

In these agreements between third party developers and Microsoft, Microsoft will guarantee the completeness and accuracy of the information provided. “As of today, the major issues concerning compliance have been resolved,” Kroes said. But she warned the commission will remain vigilant to ensure that Microsoft continues to respect its compliance obligations and does not engage in other anti-competitive behavior. (