Victory for European Commission

Court Rejects Microsoft Antitrust Appeal

Microsoft has lost its appeal against an EU antitrust order. The European Commission was correct in claiming the US software giant had abused its monopoly position, the court found.

Microsoft, the US software giant led by Bill Gates (shown here in a 2001 file photo), has lost its appeal against an EU antitrust decision.

A European Union court has dismissed Microsoft's appeal against an EU antitrust order. The decision marks a key victory for the European Commission, which regulates competition, against the US software giant.

The EU Court of First Instance in Luxembourg Monday dismissed Microsoft's appeal against the antitrust order, ruling against the US company in both parts of the case.

The European Commission's landmark 2004 decision ordered Microsoft to share communications code regarding server protocols with its competitors -- thereby allowing rivals' office servers to work seamlessly with Microsoft's Windows operating system -- and sell a copy of Windows without the Media Player multimedia software.

The court said that the European Commission was right in concluding that Microsoft was guilty of abusing its monopoly. The company is accused of trying to exploit its dominance of the desktop computer market to break into the server software market.

The bundling of Media Player with Windows also damaged rivals, the court said. "The court observes that it is beyond dispute that in consequence of the tying consumers are unable to acquire the Windows operating system without simultaneously acquiring Windows Media Player," it said. The fact that the price of the player was included in the Windows' price and that customers were not forced to use it are both irrelevant, the court said.

The court also upheld a €497 million ($613 million) fine against the company -- the largest ever levied by EU regulators. However, the court overturned the regulators' decision to appoint a monitoring trustee to check if Microsoft had complied with the ruling. The court also ordered Microsoft to pay most of the costs -- including those of some of Microsoft's business rivals which had supported the Commission's case.

The European Commission reacted to the news by saying it welcomed the court's decision, without going into further details. Microsoft has two months to appeal the decision to the EU's highest court, the European Court of Justice.

dgs/ap/reuters