March 24, 2004 5:48 PM PST

U.S. politicos fire at EU's Microsoft ruling

U.S. politicians lashed out Wednesday at the European Union's decision to seek sanctions against Microsoft, asking regulators in Brussels to reconsider their decision to levy an unprecedented fine of $613 million.

In a letter to European Competition Commissioner Mario Monti, 10 members of the House International Relations Committee said the federal litigation against Microsoft had resolved outstanding antitrust problems and jointly cautioned that it was of the "utmost importance" that the U.S. continue to take the lead in overseeing American companies' business practices.

The letter, signed by five Democrats and five Republicans, noted that "this case involves a U.S. company, that the complaining parties in the E.U. were primarily U.S. companies and that all of the relevant design decisions occurred in the United States." The signers included Robert Wexler, D-Fl., Dan Burton, R-Ind., Adam Schiff, D-Calif., and Steve Chabot, R-Ohio.

A 2002 settlement that arose out of the U.S. Justice Department's antitrust pursuit of Microsoft "established a comprehensive regulatory scheme that not only resolved past conduct, but also created a detailed compliance structure to address future competitive concerns that might arise," the letter said. "This regulatory scheme insures that Microsoft can continue to add new features into its products but allows both users and computer manufacturers to hide these additional features and use competing products instead."

Early Wednesday, the European Union ruled that Microsoft had failed to provide to rivals information they needed to compete fairly in the market and that the company has been offering Windows on the condition that it come bundled with Windows Media Player, stifling competition. The penalties levied include a requirement that Microsoft not give computer manufacturers discounts based on buying Windows along with Microsoft's Windows Media player.



The European Union's sanctions against Microsoft are:

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The House members pointed to a 1991 antitrust cooperation agreement, which the Clinton administration renewed in 1998. "We hope that the outcome of the commission's investigation does not devalue the U.S. Department of Justice's prior settlement with Microsoft and that it respects the principles of international cooperation set forth the in comity agreement," the letter said.

While strongly worded by normal political standards, the letter itself did not explicitly ask that Europe back down. But in an accompanying statement, Reps. Wexler and Peter King, R-NY, went further in their criticism. "It is imperative that we maintain America's competitiveness," King said. "Today's ruling undermines the U.S.-E.U. comity agreement and will deter U.S. companies from participating in European markets. The E.U. should reconsider its ruling."

This is not the first time that the U.S. and the Europeans have clashed over antitrust enforcement. Hostilities erupted after the European Union vetoed the proposed General Electric-Honeywell merger, which U.S. regulators had already approved. President George W. Bush publicly criticized the veto, which was widely viewed as a protectionist move designed to help European competitors such as Airbus and Lufthansa at the expense of U.S. firms.

In addition, U.S. officials sometimes view Europeans as unabashed fans of big government. In November 2001, William Kolasky, deputy assistant attorney general at the time, complained in a speech that the "European Union comes from a more statist tradition that places greater confidence in the utility of governmental intervention in markets."

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Too Harsh a decision
With the proliferation of IT in every walk of our lifes, it is imperative that we have a seemless integration between different software components and that entails that companies continue to bundle products and add values to their products. That benefits customers like me. And these days we have a choice either to go open source or go with proprierty products. It all boils down to their percieved values across the board. The customers have a choice. For example I use all three major media players in my pc. I think EU decision in that direction is too harsh. What they should make sure is that Microsoft opens its products which by the way have started doing in different forms through the provision of some underlying windows code. In the end the decision helps competitors and miserably fails customers.
Posted by (1 comment )
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US politicians are god?
The US politicians should learn to accept that there are other opinions in the world except theirs. If they really believe in freedom, then they should.
Microsoft is a convicted monopolist, even by US courts, and it is not because the US courts didn't have the guts to take the proper decision, others shouldn't.
Let's be honest, what results do I see, as a consumer, from the settlement? IE can be hidden, but it is still there, and it has proven this in a lot of occasions. And that is only one example.
Posted by Steven N (487 comments )
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Steven is right!
US don't care if MS screws people. When the judge told MS they were in trouble and that a board needed to be setup to over see them. I thought great then she told MS they get to pick the members that's like a joke.

only thing the DOJ vs MS settlement prove is a waste of taxpayers money. Hide IE that's a joke you need IE for window updates! So what's the point of hidding it? Unless you never plan to update Windows?

EU at least got the guts to stick to their guns.
Posted by Randall_Lind (7 comments )
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RE:US politicians are god?
Accepting someone else's opinion and belief in freedom doesn't bar them from criticizing an opinion that they don't agree with.


I find it funny that the entire EU investigation was prompted by U.S companies, and according to an article at TheRegister <a class="jive-link-external" href="http://www.theregister.com/content/4/36520.html" target="_newWindow">http://www.theregister.com/content/4/36520.html</a>
the EU's so called punishment isn't much of a punishment.
Posted by unknown unknown (1951 comments )
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Europe's cold war with the US
This ruling is just another step in Europe's cold war against the US. (I'm a Dutch tech journalist and former political science student. I have seen this brewing since the mid-nineties and decided to move to the US around 2000.)
In 2000 the EU adopted the Lisbon strategy. Europe was supposed to become the most succesfull and socially progressive economic block in the world. In other words, Europe was going to beat the United States economically. They were going to prove that their corporatist/socialist economic and political model is superior to that of the US. This was at the height of the dotcom boom. EU bureaucrats believed Europe would lead the mobile internet wave and overtake the US. Hence the UMTS disaster.
Since 2000 and the adoption of the euro everything has been going horribly wrong for Europe, politically and economically. More and more Europe is trying to abuse the concept of 'international law' to get its way. EU-commissioner Pascal Lamy has used the WTO to start trade wars that hurt companies on both sides of the Atlantic - but help French interests like Airbus (against Boeing) and the French farmers. Now Europe is using anti-competition law to break the back of a company that has become a symbol of American power and succes. That's what this ruling is about.
The case itself is bogus; Microsoft has plenty of competition in different areas and should have the right to bundle if that's their strategy. There are certainly signs that bundling benefits the consumer. Why should something like search not be an integral part of an operating system? Should European bureaucrats be allowed to prevent Microsoft from integrating search into the next version of Windows just because it could hurt poor Google - also made in the US?
Microsoft should just refuse to play along and stop delivering to Europe.
Posted by modifiedcontent (4 comments )
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Maybe if the US had any BALLS it would be different
I think that the EU was entirely to lienient against Monopoly Soft.
We Broke up Standard oil for putting up stations and underselling the others. We Broke up AT&#38;T because they could charge, and werem anything THEY wanted. Neither of these companies was inovationg or doing anything.
Monopoly Soft Is exactly the same. They charge what they want and they never allow anything NEW unless they own it. They copy from anyone else and undersell it till the competition is gone. And what do we do. Well The US Government in it;s great and glorious way decided to help make them even a BIGGER Monopoly. They forced them to give away 100 million dollars worth of their inflated, insecure and over blown software to education so that Kids would grow up and BUY MORE..
For a Guy that started by staeling a Public Domain Operating system and calling it his own, Then stealing the windowing from Apple and forcing the better windowing that was in GEM into bancruptsy and adopting it and ..... What have they done for anyone. They made IBM drop OS/2 which was better and more secure. Now they are FUNDING and helping SCO try to stop LINUX so they will remain the ONLY CHOICE.
And What did we do about it.
NOT A DAMN THING and I HOPE the stupid Senators that wish to ***** get stuck with it at re election. Our school systems are paying BILLIONS for this BS they CALL JUSTICE..
Pardon Me But I think they should have made them go away.
I am sure everyone is aware that Monopoly Soft even coerced the Government to let them Copyright the word "Windows".. So Every Time you say this about the "Windows" in your house or Car you need to say "copyright Monopoly Soft"...
To Bad our Republican Judges are so wimpy.
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