Linked by Thom Holwerda on Mon 17th Sep 2007 15:17 UTC, submitted by Rahul
Legal Microsoft suffered a stunning defeat on Monday when a European Union court backed a European Commission ruling that the US software giant illegally abused its market power to crush competitors. The European Union's second-highest court dismissed the company's appeal on all substantive points of the 2004 antitrustruling. The court said Microsoft, the world's largest software maker, was unjustified in tying new applications to its Windows operating system in a way that harmed consumer choice. The verdict, which may be appealed only on points of law and not of fact, could force Microsoft to change its business practices.
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RE[7]: APIs
by SReilly on Tue 18th Sep 2007 22:46 UTC in reply to "RE[6]: APIs"
SReilly
Member since:
2006-12-28

The EC guy wants to bring about what he considers to be a level playing field for competition. He explicitly states that he measures whether the competition playing field is level by measuring marketshare. His theory is one of two things (or both):
1.) If there is a dominant player, then it means that the playing field is not level.
2.) The surest way to bring about a level playing field is to ensure that there's no dominant player.

First of all, it a she, not a he. ;-p

Secondly, if you actually read everything that Ms. Kroes has been saying about this case from the beginning, you will understand that the context is all wrong.

Ms, Kroes does not want to beat MS down because they have 95% market share, she wants to remove that market share because it was obtained via illegal means. If you read up on your governments own economic history, you will find many parallels that obviously have nothing to do with either European or US views on socialism.

Sure, MS took alot away from greedy Unix providers (although there where many DOS publishers at the time) but once MS got a foot hold with Windows, anybody else was specifically disallowed to compete. (By the way, MS ripped off CP/M for DOS, originally developed in the eastern European block during Communism ;-p)

Just take BeOS as an example. OEMs where specifically told to not provide duel boot systems, with both Windows and BeOS installed, or they would lose out on partnership re bait deals. Next, lets look at personal Bill Gates emails leaked on the internet speaking of him wanting to obfuscated the ACPI specifications so that Linux could not use them.

Are you are trying to some how tell me, against all evidence, that MS is not in anyway guilty of abusing they're market position? Certainly not by avoiding the point and definitely not by arguing about something that the US has allot more of then you seem to know about,i.e. socialism. Just check out all the US trade unions that are currently lobbying you government.

Reply Parent Score: 3

RE[8]: APIs
by MollyC on Wed 19th Sep 2007 20:54 in reply to "RE[7]: APIs"
MollyC Member since:
2006-07-04

The US/MS trial specifically said that MS did not obtain "monopoly" through illegal means. And the EC "trial" didn't address that issue at all.

As for your examples, like BeOS, you say that MS told OEMs that if they allow dual-boot then they would lose out on obtaining Windows at the discounted OEM price (i.e. a price below the normal OEM price). This is standard business practice; providing special deals to those that use your products to the exclusion of competing products. It only became "illegal" in Microsoft's case, because a judge ruled years later that Microsoft had a monopoly at that time years before

Which is another problem I have with antitrust law:
ex post facto rulings and retroactive punishment. It should be that a judge/government must make an official declaration that a product has a "monopoly" in a particular market and THEN the company that makes the product can change its practices accordingly, and be punished if they do not. As it is, a company must second guess everything they do on the *chance* that a judge *might* someday in the future rule that they had a monopoly at some time in the past. That is utter BS. Microsoft's OEM deals were standard deals, fully legal by anyone that doesn't have a "monopoly", and the deals were made at a time before Microsoft was declared to have a "monopoly". Sorry, I do NOT consider that to be evil by any stretch of the imagination.

Now, I've heard it argued that Microsoft should have known that they had a monopoly before any official declaration. There are some problems with that theory:
1. OS/2 Warp was still a competitor, was being heavily advertised by IBM, and was being shipped on IBM PCs. So there was a valid competitor to Windows at the time.

2. Microsoft had invested $150 million into Apple, a company that was on the ropes at the time, and *many* said that Microsoft did that to keep competition alive so as not to run afoul of antitrust law. If so, then they took explicit steps NOT to become a monopoly. They didn't realize that a judge would rule that Macs didn't even compete with Windows computers (which went against conventional wisdom, otherwise, why the endless debates about Mac vs Windows if they aren't competitors at all?). Judge Jackson narrowed Windows market to "desktop OSes on Intel-compatible CPUs" as a way to eliminate Macs from consideration, and make it easier to declare Windows to have a monopoly.

Back to my previous point, no matter what anyone tells me, I say that before a company can be punished for abusing its monopoly status, the government must officially rule that the product in question has monopoly status, and can only punish a company for actions taken after that point. That is only fair, and it's so simple that a 5-year old would understand it. A company must know exactly when the rules that it is being held to have changed; until that time, a company should do what it would normally do; you can't run a company by second-guessing everything you do.

You guys talk of "Microsoft broke the law" all the time, without admitting that the rules changed behind Microsoft's back because nobody told them they were a monopoly. (Sorry, I'm using the slashdot posting technique of repeating myself over and over. ;) )

Here's another point, and this I got from an arstechnica post:
http://episteme.arstechnica.com/eve/forums/a/tpc/f/174096756/m/2910...
"It sometimes seems that the thinking here is: once you are declared a monopoly, all the rules change. So far, so good ... but wait, where is the rulebook that you must switch to once you have been declared a monopoly? Where can you find the definitive list of 'things I can do, things I can't do' in the Rulebook For Declared Monopolists? How does a declared monopolist change status and become a declared not-monopolist again?

This rulebook seems missing, so anyone can come to the argument and say 'they are a monopolist, therefor what they did was bad and they should be punished'. Dang. No way to refute that!"


What he's saying is that even after being declared a monopoly, there is no rulebook that says what you can and can't do, and the EU has been playing that game to a tee. During Vista's development, Microsoft continually kept the EC aprised as to what they were doing, asking whether it ran afoul of EC law. The EC kept saying, "It's not up to us to tell you if these features are illegal, it's up to you to comply with our law" which is another way of saying, "That's for us to know and you to find out". The EU has never provided a rulebook for Microsoft to follow, which allows the EC to make any ruling it wishes and justify it by saying "The rules are different for you because you are a monopoly!" That is more BS.

You know why MS and the US DOJ have such an amicable relationship now? Because the result of the MS/DOJ trial was a settlement that included explicit rules, regulations, and internal and external oversight committees. Microsoft doesn't do anything without getting OKs from its internal and then the external oversight committees. Which is why the DOJ has sided with MS regarding Google's complaints; because Goolge complained about actions that the oversight committees already OKed. This is why, even though the oversight is scheduled to end in Nov 2007, Microsoft asked that certain portions of the settelment be extended to 2012, and potentially beyond. Because they like having clear rules.

The EU, on the other hand, doesn't want any clear rules, so they can maintain the ability to punish Microsoft after the fact, and at their whim, leveling fines, not so much to enrich the EU's coffers but to look tough to the public.


Finally, Judge Jackson's monopoly ruling is no longer valid today. Windows does not have a monopoly on "desktop OSes for intel-compatible CPUs". First, Dell ships Linux PCs. Second, HP ships Linux PCs. Third Lenovo (sp) as delclared they will ship Linux desktops. And finally, Jackson cleverly narrowed Windows market so as to rule out the Mac, but guess what, today OSX is a "desktop OS that runs on intel-compatible CPUs". So from where I sit, today there is no monopoly (not the one that Jackson declared), so there should be no special rules for Microsoft anymore (which is one reason that the MS/DOJ settlement was scheduled to end in Nov rather than being open-ended, because things DO change over time).

The EC woman, on the other hand, says she will consider that things have changed, only by Microsoft losing marketshare. Even if every OEM sold Linux PCs and Jobs let every OEM sell OSX computers, if Microsoft didn't lose marketshare the EC would still consider MS to have a monopoly. And that is the definition of "lame".

Edited 2007-09-19 21:14

Reply Parent Score: 2