European regulators have begun two new antitrust probes into Microsoft's business practices: one will explore whether Microsoft illegally bundles Internet Explorer (IE) with Windows, while the other investigates whether Microsoft has properly revealed interoperability information for Office file formats, unspecified server products, and the .NET Framework. The announcement, which came less than four months after a court decision strongly upheld sanctions from an earlier European investigation, underscores that antitrust litigation will be a chronic problem, particularly in Europe, as long as Microsoft maintains its dominant market share in OSs and productivity applications.

Complaints from ECIS, Opera

On Jan. 14, 2008, the European Commission (EC), which oversees antitrust and fair competition enforcement for the European Union (EU), announced that it had initiated two formal investigations against Microsoft.

Interoperability. One investigation responds to complaints by the European Committee for Interoperable Systems (ECIS), a trade group that includes Microsoft competitors Adobe, Corel, IBM, Linspire, Nokia, Opera, Oracle, RealNetworks, Red Hat, and Sun Microsystems. The ECIS first complained in Feb. 2006 that Microsoft's insistence on using proprietary file formats in Office, rather than the royalty-free OpenDocument format, was hampering interoperability between Office and other productivity products. Since then, Microsoft has introduced a new file format, Open Office XML, in Office 2007, and has attempted to get that format accepted as a standard by various bodies. (So far, Ecma has approved it, but the International Standards Organization, or ISO, has not.) The EC says it will investigate whether Open Office XML is sufficiently interoperable with competitors' products. The EC is also investigating interoperability concerns with other unnamed Microsoft server products and with the .NET Framework.

Browser tying. The other investigation is a response to a Dec. 2007 complaint by Norway-based browser developer Opera. Opera's complaint, made public on Dec. 13, alleged that Microsoft illegally tied IE to Windows in order to use its market power in desktop OSs to dominate the market for Web browsers. Opera also argued that, once Microsoft had achieved dominant market share with IE, it refused to support certain published Web standards. Because it is expensive for site designers to support multiple sets of standards, they tended to design their sites for IE, further squeezing out other Web browsers, Opera alleged.

In its complaint, Opera asked the EC to force Microsoft to sell Windows without IE and to force IE to follow "fundamental and open Web standards accepted by the Web-authoring communities." Microsoft responded several days later by announcing that the current build of IE 8, the next version of IE, passes the Acid2 Browser Test, a set of tests used to validate browsers' compliance with various widely accepted (but not necessarily "standard") technologies. However, this announcement was not enough to stave off the EC's investigation of Opera's complaints. The EC also said it is investigating the possibility that Microsoft tied other formerly separate products, such as desktop search and Windows Live online services, to Windows.

Both investigations draw on the precedent set by a Mar. 2004 ruling by the EC, which ordered Microsoft to disclose certain information that would make it easier to design non-Windows servers (such as the open source Samba file-and-print server) that could interoperate with Windows servers and clients, and ordered Microsoft to sell a version of Windows without the Windows Media Player. Microsoft appealed that ruling, but the European Court of First Instance denied that appeal on nearly all grounds in Sept. 2007, and Microsoft quickly complied with the interoperability portion of the ruling. (Microsoft had already released versions of Windows without the Media Player.)

While the outcome of these latest investigations is far from certain, they could move much more quickly than the last one, as the EC will not have to investigate or prove certain facts, such as that Microsoft holds a dominant position in desktop OSs. More generally, the EC has put Microsoft on notice that it will be monitoring possible anticompetitive behavior across all its product lines, and that the end of the last investigation was not necessarily the end of Microsoft's antitrust woes.

Resources

The EC's announcement of its new investigations can be found at europa.eu/rapid/pressReleasesAction.do?reference=MEMO/08/19&format=HTML&aged=0&language=EN&guiLanguage=en.

The Court of First Instance's denial of Microsoft's appeal was covered in "EU Appeal Fails and Other Legal News" on page 27 of the Oct. 2007 Update.

The ISO's initial rejection of Open Office XML as a standard is covered in "Office XML Loses Initial ISO Vote" on page 14 of the Oct. 2007 Update.

The Acid2 Browser Test can be found at www.webstandards.org/action/acid2.