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Microsoft fined $731m by EU

Old 03-06-13, 07:09 AM
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Microsoft fined $731m by EU

http://www.bbc.co.uk/news/technology-21684329


Microsoft has been fined 561 million euros ($731m; 484m) for failing to promote a range of web browsers, rather than just Internet Explorer program, to users in the European Union (EU).

It introduced a Browser Choice Screen pop-up in March 2010 as part of a settlement following an earlier EU competition investigation.

But the US company dropped the feature in a Windows 7 update in February 2011.

Microsoft said the omission had been the result of a "technical error".

But competition commissioner Joaquin Almunia said the action was unprecedented, adding he wanted to deter any company from the "temptation" of reneging on such a promise.

In theory the watchdog could have fined the firm 10% of its global annual revenue, which would have totalled $7.4bn based on its 2012 report.

"We take full responsibility for the technical error that caused this problem and have apologised for it," a spokesman for Microsoft said following the announcement.

"We provided the Commission with a complete and candid assessment of the situation, and we have taken steps to strengthen our software development and other processes to help avoid this mistake - or anything similar - in the future."

One lawyer said the ruling was also intended to send out a message to others.

"The European Commission is sending a firm signal in this first case of its type that it will not tolerate failure by a company to comply with the commitments it gave to settle an antitrust infringement procedure," said Tony Woodgate from Simmons & Simmons.

"These 'commitments decisions' are currently the European Commission's favoured mechanism to close abuse of dominance proceedings, saving enforcement resource and allowing for a speedy resolution."

Browser 'oversight'
The case dates back to 2007 when Opera - a Norwegian web-browser maker - complained Microsoft was stifling competition on PCs by bundling Internet Explorer with its operating system.

Microsoft initially argued that the move benefited users, but after the European Commission issued a preliminary report suggesting the firm had abused its position, the company agreed to offer a choice of browser until at least 2014 to avoid risking a fine.

However, this option was missing from its Windows 7 Service Pack 1 released in 2011 and it continued to be absent for 14 months.

During that time, Microsoft reported it was still complying with the agreement.

After the EU was alerted to the problem, it contacted Microsoft, which subsequently issued an apology suggesting its engineers had accidentally missed the issue.

It also acted to restore the facility. But the move was not enough to prevent an eight-month follow-up investigation by the commission into what punishment was needed.

Warning to others
At a press conference in Brussels, Mr Almunia said Microsoft's lack of compliance represented a "serious breach" and was the first time a firm had failed to meet such a commitment.

He explained that he preferred negotiated settlements, rather than extended legal battles, when tackling competition complaints in the fast moving IT sector.

But he added that Microsoft's willingness to co-operate with the EU's subsequent investigation had acted as a mitigating factor when determining the level of the fine.

"I hope this will make companies think twice before they ever thinking of breaching their international obligations," said the commissioner.

Microsoft's chief executive Steve Ballmer and the former head of its Windows division Steven Sinofsky have already had their most recent bonuses docked, in part because of the browser affair.

Opera told the BBC it was "happy to see that the Commission is enforcing compliance with the commitment, which is critical to ensuring a genuine choice among web browsers for consumers".

However, one industry watcher suggested there were still unresolved issues,

"While it's highly likely that it was a technical mistake that broke the browser choice facility the fact that it remained broken for 14 months raises significant questions about Microsoft's ability and willingness to comply with the voluntary agreement with the EU," said Chris Green, principal analyst at the consultants Davies Murphy Group Europe.

"At the same time the situation also raises concerns over the EU's ability to actually monitor the outcomes of antitrust agreements."



Can someone explain to me how MSFT gets fined for this (I understand this is because of an old case) but Apple has no problem bundling Safari with its OS X and iOS? Until recently, you couldn't even get another browser on iOS much less an prompted option to.

Anyone know enough of European law to exlpain the difference?
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Old 03-06-13, 07:59 AM
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Re: Microsoft fined $731m by EU

That's a pretty huge screwup by someone at Microsoft, given they had agreed to do it until 2014.

The initial ruling that prompted them to do so is garbage though.

This is the part I find the most shocking:
In theory the watchdog could have fined the firm 10% of its global annual revenue
Do they submit to this authority in order to sell in Europe?

Originally Posted by Venusian View Post
Can someone explain to me how MSFT gets fined for this (I understand this is because of an old case) but Apple has no problem bundling Safari with its OS X and iOS?
If I had to guess, I would say market share.
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Old 03-06-13, 08:04 AM
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Re: Microsoft fined $731m by EU

Yeah, when Microsoft was pulling their shenanigans, they controlled like 96% of the desktop market. And IE is STILL the worst browser out there.
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Old 03-06-13, 08:59 AM
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Re: Microsoft fined $731m by EU

Originally Posted by Venusian View Post
http://www.bbc.co.uk/news/technology-21684329







Can someone explain to me how MSFT gets fined for this (I understand this is because of an old case) but Apple has no problem bundling Safari with its OS X and iOS? Until recently, you couldn't even get another browser on iOS much less an prompted option to.

Anyone know enough of European law to exlpain the difference?
Microsoft is judged to be big and evil, while Apple is small, fluffy, and nice, like a lion and a housecat. Just go with it, don't let facts get in the way of important determinations of monopoly.

Anybody who really hates IE can still use it to download another browser, even without a popup "choice" window. So the customer who doesn't want to use IE isn't really severely impacted. I've listened to the "IE is terrible" crowd, tried Firefox and Chrome, didn't see a lot of difference, and went back to IE.

Given that all the browsers are free, what are the real damages of not "selling" an alternative browser. I think it is just a matter of much Europeans hate Microsoft.
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Old 03-06-13, 09:11 AM
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Re: Microsoft fined $731m by EU

Originally Posted by Venusian View Post
http://www.bbc.co.uk/news/technology-21684329

Can someone explain to me how MSFT gets fined for this (I understand this is because of an old case) but Apple has no problem bundling Safari with its OS X and iOS? Until recently, you couldn't even get another browser on iOS much less an prompted option to.

Anyone know enough of European law to exlpain the difference?
It has been a long time, but I think part of the objection at the time was how MSIE was baked into the OS, not just a stand alone browser that was included with the OS. You couldn't even actually remove it or operate the system without it. That, and their stellar market share at the time.
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Old 03-06-13, 09:13 AM
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Re: Microsoft fined $731m by EU

It's all about market share. As big as Apple is, it doesn't have a majority of the smartphone market share. I don't think it even has a plurality any more. That means that in the eyes of competition (antitrust) law, Apple is not in a position to force consumers into Safari the way Microsoft, with its dominant Windows market share, was in a position to force consumers into IE.
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Old 03-06-13, 11:50 AM
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Re: Microsoft fined $731m by EU

They do some really good things with their laws over there (like punishing large corporations who bury little guys with legal paperwork, etc.), but I thought this one was crap long ago. Where there are multiple free options, I don't see where a company should have to essentially promote other products than their own. There may be an instance in which they should, but not in web browsers, imo.
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Old 03-06-13, 01:54 PM
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Re: Microsoft fined $731m by EU

Originally Posted by OldDude View Post
Microsoft is judged to be big and evil, while Apple is small, fluffy, and nice, like a lion and a housecat. Just go with it, don't let facts get in the way of important determinations of monopoly.

Anybody who really hates IE can still use it to download another browser, even without a popup "choice" window. So the customer who doesn't want to use IE isn't really severely impacted. I've listened to the "IE is terrible" crowd, tried Firefox and Chrome, didn't see a lot of difference, and went back to IE.

Given that all the browsers are free, what are the real damages of not "selling" an alternative browser. I think it is just a matter of much Europeans hate Microsoft.
Or looking at the case from a 1997 perspective when Apple was near the brink of death. Does Apple have anywhere near the monopoly power as MS? Not even fucking close.
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Old 03-06-13, 01:56 PM
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Re: Microsoft fined $731m by EU

Originally Posted by JasonF View Post
It's all about market share. As big as Apple is, it doesn't have a majority of the smartphone market share. I don't think it even has a plurality any more. That means that in the eyes of competition (antitrust) law, Apple is not in a position to force consumers into Safari the way Microsoft, with its dominant Windows market share, was in a position to force consumers into IE.
Not only did MS force consumers into using IE, they forced nearly EVERY PC manufacturer into making Windows the default OS. Any PC manufacturer that wanted to include a Linux option met the hellfire of MS attorneys.
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Old 03-06-13, 02:05 PM
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Re: Microsoft fined $731m by EU

Originally Posted by kvrdave View Post
They do some really good things with their laws over there (like punishing large corporations who bury little guys with legal paperwork, etc.), but I thought this one was crap long ago. Where there are multiple free options, I don't see where a company should have to essentially promote other products than their own. There may be an instance in which they should, but not in web browsers, imo.
Yup

Originally Posted by CRM114 View Post
Not only did MS force consumers into using IE, they forced nearly EVERY PC manufacturer into making Windows the default OS. Any PC manufacturer that wanted to include a Linux option met the hellfire of MS attorneys.
No one forced you to use IE. I haven't used it for years.

The ruling essentially says "people are to stupid to do a quick search or ask someone knowledgable. So we will make MS tell them they don't have to use IE".

What's next a pop up that says "your computer came with Windows 8. However we know your too dumb to realize there are other OS's. Have you ever heard of Apple?"
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Old 03-06-13, 02:11 PM
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Re: Microsoft fined $731m by EU

Yes, the general populace does not understand basic computer concepts - even to this day. What's your point?
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Old 03-06-13, 02:51 PM
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Re: Microsoft fined $731m by EU

Perhaps the EU should focus on Apple for their closed system where every App for the iPad has to be purchase from Apple.
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Old 03-06-13, 03:09 PM
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Re: Microsoft fined $731m by EU

Originally Posted by WCChiCubsFan View Post
Perhaps the EU should focus on Apple for their closed system where every App for the iPad has to be purchase from Apple.
Apple's system stifles innovation because of all the craziness you have to go through to get your app certified. But as long as it isn't stifling competition, I guess it is legal
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Old 03-06-13, 03:26 PM
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Re: Microsoft fined $731m by EU

Craziness? Submitting it to Apple and waiting for approval? How does that stifle innovation? That's a pretty comical statement given the explosion of innovative iOS apps hitting the marketplace on a daily basis.

Besides that, if the iOS platform controlled 96% of the market, you might have an argument.
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Old 03-06-13, 03:36 PM
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Re: Microsoft fined $731m by EU

The idea is that Microsoft is essentially forcing you to buy IE even if all you want is Windows. That's a concept know in antitrust/competition law as tying.

Wikipedia has some information on tying in general and with regard to Microsoft in particular.

http://en.wikipedia.org/wiki/Tying_(commerce)
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Old 03-06-13, 03:38 PM
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Re: Microsoft fined $731m by EU

Originally Posted by CRM114 View Post
Yes, the general populace does not understand basic computer concepts - even to this day. What's your point?
You can't make a law against stupidity. And trying to is....stupid and does a a true dis-service to the poplulence its trying to protect.

"I don't have to think for myself, I don't have to the learn the very basics of anything, someone will look after me."
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Old 03-06-13, 03:43 PM
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Re: Microsoft fined $731m by EU

funny I first heard of this yesterday from a guy who happened to be a legal rep from Microsoft
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Old 03-06-13, 04:11 PM
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Re: Microsoft fined $731m by EU

Originally Posted by CRM114
Any PC manufacturer that wanted to include a Linux option met the hellfire of MS attorneys.
Not sure if this is true. While the linux pc market is small, plenty buy linux servers. Dell offers linux PCs.
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Old 03-06-13, 04:17 PM
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Re: Microsoft fined $731m by EU

Originally Posted by CRM114 View Post
Yeah, when Microsoft was pulling their shenanigans, they controlled like 96% of the desktop market. And IE is STILL the worst browser out there.
I'm with you on that. I don't care about customization and specifics. Give me a browser that doesn't crash, doesn't lose my printer, etc and I'm there. IE does not perform.

If Microsoft wants people to use IE, make it good. If windows came without IE, and I knew it was a solid browser, I go and download it.

It took a minute to install Google Chrome and I like it. Because it's stable.
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Old 03-06-13, 04:31 PM
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Re: Microsoft fined $731m by EU

Originally Posted by CRM114 View Post
Craziness? Submitting it to Apple and waiting for approval? How does that stifle innovation? That's a pretty comical statement given the explosion of innovative iOS apps hitting the marketplace on a daily basis.

Besides that, if the iOS platform controlled 96% of the market, you might have an argument.
Apple routinely discriminate against apps that compete against their own software and services.
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Old 03-06-13, 05:18 PM
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Re: Microsoft fined $731m by EU

Originally Posted by wmansir View Post
Apple routinely discriminate against apps that compete against their own software and services.
Discriminate how? I'm not saying they don't, just curious what you mean by it.
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Old 03-06-13, 05:22 PM
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Re: Microsoft fined $731m by EU

Originally Posted by Ranger View Post
Not sure if this is true. While the linux pc market is small, plenty buy linux servers. Dell offers linux PCs.
It was sort of true (google Windows refunds), but it's no longer true.
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Old 03-06-13, 07:46 PM
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Re: Microsoft fined $731m by EU

Originally Posted by CRM114 View Post
Craziness? Submitting it to Apple and waiting for approval? How does that stifle innovation? That's a pretty comical statement given the explosion of innovative iOS apps hitting the marketplace on a daily basis.

Besides that, if the iOS platform controlled 96% of the market, you might have an argument.
Apple has specific rules about a lot of stuff for apps. And worse they aren't all published. They will randomly refuse an app for seemingly random reasons
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Old 03-06-13, 07:48 PM
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Re: Microsoft fined $731m by EU

Originally Posted by Tracer Bullet View Post
Discriminate how? I'm not saying they don't, just curious what you mean by it.
it took them years to allow a different browser than safari. They repeatedly blocked Google Voice because they saw it as competition. They don't allow apps to render html on their own (this may have changed recently, I haven't kept up)
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Old 03-06-13, 07:55 PM
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Re: Microsoft fined $731m by EU

Fine the everloving shit out those lying, cheating Microsoft bastards!
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