Microsoft claims Breakthrough in EU Hearings

Apr 1, 2006 16:37 IST

Microsoft said on Friday it has made a " breakthrough" in its long-running antitrust battle with the European Commission, saying it had finally perceived what the competition regulator wanted the software group to do to evade the menace of penalties of up to €2m ($2.4m) a day. The company was optimistic it could stave off considerable heavy fines as it entered the final day of hearings with European regulators.

Microsoft said on Friday it has made a

According to the officials of Microsoft the group’s optimism was the result of a discussion between its software engineers and Professor Neil Barrett, the British computer scientist who acts as the Commission’s technical adviser on the case, during Thursday’s first day of hearings in Brussels.

Brad Smith, the group’s general counsel, said, "I believe that we have had a breakthrough," adding that "I only wish we could have had that kind of dialogue sooner." He said that the group had at last been given the "specificity and clarity that we need in order to work in a constructive way".

However, company’s opponents said the group’s statement could mean it was machinating a back down to avoid the threat of fresh financial penalties. They also emphasized that the Commission’s ruling clearly narrated Microsoft’s obligations, and that Microsoft should have acted in accordance with it more than two years ago. Both the sides had agreed a template setting out what steps Microsoft had to take to move into compliance with the March 2004 decision.

Packed with more than a hundred lawyers and officials, the hearing is the company’s last chance to guard itself before the EU decides whether to levy €2m (£1.4m) a day penalties, imposed after it found the software giant guilty of anti-competitive behavior.

Large number of lawyers who attended the hearing on behalf of Microsoft’s rivals brushed-off talk of a breakthrough. A lawyer said, "It would indeed be a breakthrough if they complied with the March 2004 decision. The decision is very clear. They have known perfectly well what they have to do to comply ever since."

The main cause of the dispute is the accusation that Microsoft has not drawn up "complete and accurate" technical documentation that would allow competitor software developers to design server software that runs smoothly with Windows operating system.

Contrary to this Microsoft claims it has offered full disclosure, although group has so far drawn up about 12,500 pages of documentation but the Commission and a neutral trustee in the case called its documentation "totally useless". EU spokesman Jonathan Todd said the company still had not shared satisfactory technical information with rivals so that they could make software compatible with Microsoft’s Windows computer operating system.

The European Commission has already penalized Microsoft and is threatening more, backdated to December 15, if the company does not release adequate data that would enable other software developers to create software compatible with its Windows operating system.