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Microsoft faces questions on handwriting software in EU

European Competition Commissioner Neelie Kroes has written to Microsoft Corp.’s Chief Executive Steve Ballmer about how wrapping search and security features into Windows Vista may prevent consumers from using rival firms' products.”There's been a formal exchange of correspondence between Kroes and Ballmer,” Philip Lowe, the top civil servant in the commission's competition department, said in an interview yesterday in Washington where he is attending a conference. „I can't exclude the fact that there are other issues that have been raised, including this one, between the teams.” Microsoft, which is under regulatory scrutiny around the world, plans to release Vista to corporate customers in November and to retail stores in January. The first new version of Windows for personal computers since 2001 is also attracting complaints in the US. The US and the EU haven't identified the companies that have complained.The European Commission, the EU's antitrust arm in Brussels, levied a record fine of € 497 million ($631 million) against Microsoft, the world's largest software maker, in March 2004 for abusing its dominance in Windows to prevent rivals from developing products in network servers and audio-visual software.

Microsoft began selling Windows XP Tablet Edition in 2002 with features that allowed customers to take notes on the screen of touch-sensitive laptop computer. The software could then convert those notes into text or save an image of the notes. With Vista, Microsoft has ceased selling a Tablet Edition and will instead include those features in four of the five versions of Vista planned for sale. The commission has said it expects the Redmond, Washington-based company to respect the principles established by the March 2004 decision when designing and implementing Vista. Defying those standards would prompt the commission „to intervene again,” Lowe said. Microsoft, whose software runs on more than 90% of the world's PCs, said last week that it may delay the release of Vista in Europe if regulators demand changes. Lowe said the commission wants to identify areas „where we can hopefully influence Vista before it's launched.”

„We don't in principle see that the issues we've raised require any delay in shipment,” he said. „Some of the adjustments could in principle be done later, possibly after the product has been released.” Erich Andersen, Microsoft's general counsel for Europe, said yesterday the company wants to introduce Vista „in a fully lawful manner.” Lowe said Microsoft has asked for „further guidance” on the commission's concerns. „If there's anything that needs to be clarified, we'll clarify it,” he said. The company is appealing the EU's order to license information about Windows to rivals and to sell a version of Windows without media player functions. The EU fined Microsoft € 280.5 million in July for not providing rivals with „complete and accurate” information. The commission has threatened to impose daily fines of as much as € 3 million if the company doesn't comply. (Bloomberg)