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EU Hits Microsoft with Record Fine | |
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| Time: 06:41 EST/11:41 GMT | News Source: eWeek | Posted By: Kenneth van Surksum | ||
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The European Commission fined Microsoft a record 899 million euros ($1.35 billion) on Wednesday for defying sanctions imposed on the software giant for antitrust violations, far exceeding the original penalty. | ||
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| #1 By 28801 (65.90.202.10) at 2/27/2008 7:02:20 AM |
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EU: “Microsoft, the secret technology that you have developed must be made available to anyone who wants to compete with you. You may charge these competitors for this technology, but only what we tell you to charge.”
Enough already! The US government should get involved here. This is bordering on persecution. In my world, I would pull out of that market and tell the EU to stick it. (I guess that’s why I don’t have my own world) |
| #2 By 52115 (66.181.69.210) at 2/27/2008 7:47:17 AM |
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But, if you want to compete in a global business, then you have to conform with the laws of other countries, etc.
Just because something is written in stone here in the US, it has no merit in EU, etc. |
| #3 By 22601 (99.230.135.69) at 2/27/2008 7:57:47 AM |
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I think that it has gotten to the point that MS should should walk away from the EU, stop selling its products there, stop supporting its products there, forcing EU governments, companies, and citizens to switch to something else, like Linux. There is no point in operating in the EU if the EU just confiscates its income.
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| #4 By 2231 (72.5.151.4) at 2/27/2008 8:35:08 AM |
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This should come as no surprise for MS. The EU has always said that if you want to play on their playground then you have to play by their rules.
Microsoft ultimately has 2 options after paying the fine, leave the EU or comply with the law. This post was edited by schwit on Wednesday, February 27, 2008 at 08:36. |
| #5 By 15406 (216.191.227.68) at 2/27/2008 9:03:47 AM |
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Oh geez, somebody called the wahmbulance. MS, acting like it's above the law as usual, gets slapped down and all the fanboys can do is whine about how hard-done by MS is. If MS doesn't want to get slapped by the EU's antitrust gang, perhaps MS should stop its constant, on-going antitrust violations.
#1: The US should get involved here? And do what? #2: Word. #3: Yep, that'll show the EU who's boss. Now, what to tell the shareholders about those missing billions of revenue... #4: What you say seems so obvious, but for some reason others have a hard time comprehending a world where MS doesn't dictate to everyone else but instead has someone dictating to MS. |
| #6 By 89249 (64.207.240.90) at 2/27/2008 10:11:21 AM |
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Its too bad the EU is so anti-successful business.
The fact that a government thinks it should force one company to work with another for any reason is quite funny and is exactly what the EU has been pushing for. Mind you, latch will surely disagree, Microsoft does provide methods for anybody to work with nearly all of their software. The problem became that some other companies wanted more access and decided to use the Government to put a gun to MS's head to force them to do it. MS owns its property and should never be told what they are supposed to do with it. Unfortunately this is the market you have to work with in the EU (and obviously the reason their economies are so... shakey). MS will probably just laugh off the fine and pay it. At some point though they may run MS off. Quite frankly the fact that there isn't a decent alternative for businesses outside of MS software is not Microsofts fault. We're nearly 20 years into the Linux & 7 years into Open Office revolution and it still has get to gain anything resembling a foothold on the market. |
| #7 By 2201 (212.117.228.133) at 2/27/2008 10:20:31 AM |
| #6 actually the reason why there isn't a decent alternative for businesses outside of MS's software IS partly Microsoft's fault, established by the antitrust ruling inside the US itself. So lets not pretend that Microsoft is completely innocent here. It's amazing at how some posters seem to think that MS is hard done by, when they've already been proved to hold back competition. Maybe it's the fact that the US authorities haven't been seen to show their teeth with the rulings while the EU shows everyone how it's done. |
| #8 By 89249 (64.207.240.90) at 2/27/2008 10:28:43 AM |
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#7 I find the anti-trust laws to be based off of economic ignorance. Every business who has entered into a contract with Microsoft and every consumer who has ever purchased their product chose to do so w/o being forced. There have always been alternatives. Those alternatives have just never, even now after all of these years, be better than MS software.
Today, just like in 1995 every business who sells a computer can choose what Operating system or software to use. Nobody has ever had a gun put to their head to purchase MS products or contract to sell MS products. Its amazing how some posters seem to think Microsoft has godlike powers forcing everybody in our economy to do their bidding. The only entity that has such powers is Government. This post was edited by MrHumpty on Wednesday, February 27, 2008 at 10:29. |
| #9 By 15406 (216.191.227.68) at 2/27/2008 10:33:29 AM |
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#6: Its too bad the EU is so anti-successful business.
You're right. I can't think of a single successful business in all the EU. And the way the EU Commission is going after all those other companies for their egregious and regular antitrust violations speaks volumes. The fact that a government thinks it should force one company to work with another for any reason is quite funny and is exactly what the EU has been pushing for. Just the other day they order Franz's Meat market to better interoperate with Himmel's Mens Wear. Maybe, just maybe, they see MS as a dominant monopolist that has already been convicted of abusing its position, and perhaps they see that MS has been withholding interoperability information so that its competitors were at a disadvantage compared to MS own offerings, thereby reinforcing the MS lock-in and excluding serious competition which would benefit everyone (except Microsoft). Unfortunately this is the market you have to work with in the EU (and obviously the reason their economies are so... shakey). MS will probably just laugh off the fine and pay it. At some point though they may run MS off. Run MS off? You make that sound like a bad thing. Quite frankly the fact that there isn't a decent alternative for businesses outside of MS software is not Microsofts fault. We're nearly 20 years into the Linux & 7 years into Open Office revolution and it still has get to gain anything resembling a foothold on the market. As #7 has already informed you of, MS is most certainly a large part of the problem with lack of viable alternatives. See, that's why antitrust law is so important. You have behemoths like MS stifling any competition, and using their monopoly to control the entire landscape. Then they have fanboys like you saying that poor MS isn't to blame for the lack of competition. #7: DING! DING! DING! We have a winner! |
| #10 By 7746 (77.248.64.129) at 2/27/2008 12:00:16 PM |
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EU citizens already paid up for that 1.3 billion for the standard rate change policy of 1 dollar = 1 euro. Or even worse, as most official licenses fee or software fee are double or more of that asked in the US. On top of this they mostly have reduced support options and even functionality in some of their products. Or did you think that exactly the same support-options and product-features are available in a Swedish Vista Ultimate vs the US Vista Ultimate.. think again since it ain't so.
The EU is a 480 million citizen market, almost twice that of the US. Ignorant to think MS will ever ignore or leave this market. |
| #11 By 3653 (65.80.181.153) at 2/27/2008 12:12:17 PM |
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Lets review...
EU says MSFT must license PATENTS x/y/z, but we won't tell you how much to charge. MSFT gives access to PATENTS x/y/z for 2.98% to 3.87% of revenues. EU immediately responds: "make it cheaper, but we wont tell you how much cheaper". 2 months later: MSFT gives access to PATENTS x/y/z for 0.5% to 0.7% of revenues "make it cheaper, but again we wont tell you how much cheaper" MSFT gives access to protocols for $14,900 or a worldwide license for 0.4% of revenue Its time for the US to start applying some equal tariffs to a few random successful EU companies. Lets start with Siemens and see what happens. Oh, and before those with no business understanding (latch&2sugars) get too excited... remember that according to you... MSFT has a windows monopoly. So, by the very definition of monopoly... MSFT will simply raise the price of Windows for European customers. IOW, the EU just successfully taxed their own people. This post was edited by mooresa56 on Wednesday, February 27, 2008 at 12:15. |
| #12 By 28801 (65.90.202.10) at 2/27/2008 12:37:34 PM |
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Mr. Latch has a borderline successful coffee business. One day he develops a method of roasting beans that makes his coffee the beverage of choice for Canadian losers everywhere. Mr. Latch decides to go global and establishes a very successful overseas market. One day the EU steps in and tells Mr. Latch that he must share his top secret roasting method with his competitors but that he may charge them for it. Mr. Latch grudgingly complies and gives up his secret methods to café de France for a nominal fee. Months Later the EU fines Mr. Latch for charging too much for his roasting methods.
Ultimately Latch’s coffee is driven out of business because there is no longer anything special about his product. After spending months in a mental institution, Mr. Latch decides to continue to serve coffee at some of Canada’s finer diners. #10: Cry me a river. US citizens have been subsidizing the world’s pharmaceutical research for decades. |
| #13 By 3653 (65.80.181.153) at 2/27/2008 12:47:24 PM |
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xavalon - "Ignorant to think MS will ever ignore or leave this market"
You're right, that MS will never leave the EU. But that won't stop your own government from making the situation worse for YOU, via proxy (MSFT, or some other company). At the end of the day, its just another tax. And EU folks are surely smart enough to realize that those taxes aren't ultimately paid by Bill Gates. They will trickle right down to the retail price, as they should. |
| #14 By 3746 (72.12.161.38) at 2/27/2008 2:30:21 PM |
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#11
Great overview of what happened. The EU has gone too far this time IMHO. I am not weeping for MS they got plenty of cash and in the end they will just pass the cost onto consumers like the others have said. #9 I love how one one hand the open source fan boys say that Linux is better then MS products but will turn around and say there is no viable alternatives. I mean either Linux is all that or it isn't. If it is that great then there are viable alternatives and people should and could be running it. You can't have it both ways. |
| #15 By 2201 (78.32.103.51) at 2/27/2008 4:02:26 PM |
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#11 "Oh, and before those with no business understanding (latch&2sugars) get too excited... remember that according to you... MSFT has a windows monopoly. So, by the very definition of monopoly... MSFT will simply raise the price of Windows for European customers. IOW, the EU just successfully taxed their own people."
The price of Windows in the EU is already scandalous actually (compared to the US), showing a classic example of little competition. Exchange rates certainitely can't be blamed here. |
| #16 By 89249 (64.207.240.90) at 2/27/2008 4:20:41 PM |
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#15
The price of Windows is increased for a number of reasons. Obviously first is the strength of the Euro to the Dollar atm. Second is almost as significant is the extra cost of doing business in the EU. Increased labor costs, taxes, import/export costs really do make a big difference. And obviously paying fines until the end of time figures in there too :) If "little competition" would cause them to increase rates... Why haven't they increased their prices in the US AT ALL in a long time. I've been paying the same amount for Windows Server for as long as I can remember (NT4 I think was about on par). They haven't increased those costs with inflation even over the past decade. Simple fact is it costs more to do business there than in the US and the consumer pays everything that a Corporation does. Microsoft won't pay that fine. You, me, and anybody else who buys a Microsoft Product will. |
| #17 By 20505 (216.102.144.11) at 2/27/2008 6:29:18 PM |
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A question to the overseas gents on this forum.
Don't the EU countries get essentially "raped" on all overseas tech goods? A quick browse of Trusted Reviews shows that Europeans seem to pay 20-25% more on just about any tech good originating from the far east or the US. What's with that? |
| #18 By 86292 (193.129.71.197) at 2/28/2008 4:52:48 AM |
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#17 - Yes, we do get ripped off by foreign companies here in the EU. Adobe is one of the worst: their products cost around 100% more here than in the USA. MS also charge more; Apple charge more too, but they are more like 20-50% more expensive. It's not just the US that charges more though. Wii points cost more money per point here than in either Japan or the USA.
Regarding the fine: yes it is huge. Microsoft have no choice but to pay it though; the alternative would be commercial suicide. As #10 says, there is a 480 million person market here and the EU's combined GDP is greater than the USA's and growing as eastern European countries come on board. Some numpty claimed the economies of the EU countries were shaky. This is a grossly stupid claim. The Euro is rock solid whilst the US dollar's value has fallen through the floor. The EU is the biggest, most stable, market in the world: Microsoft cannot walk away from that. |
| #19 By 89249 (64.207.240.90) at 2/28/2008 8:50:48 AM |
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#18 Sorry David but many EU contries have slower real gdp growth and higher fluxuations/actual unemployment rates. Most of the few actually looking great are on the verge of serious slow down due to financial market problems and increased welfare state commitments.
Also the Dollar being weak against the Euro is very, very, VERY bad for the EU. One of the largest consumers of EU's products is the United States. Just like Canada you will find that your companies that derive a large portion of their revenues/profits from the United States are going to be getting squeezed bad over this time. Currencies are something very few people understand... hell I don't understand it that well. But my Dad who's been involved in trading currencies since I was a young pup will tell you... Canadians and Europeans that think this is a great thing are in for a big surprise. |
| #20 By 3653 (65.80.181.153) at 2/28/2008 1:14:19 PM |
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DavidArno, you had me right up to the point you fell into crazy with that last paragraph. The last sentence is correct, but the rest is, as you all say it... rubbish.
MrHumpty has a more accurate take. The dollar/EU ratio is very bad for Europe. Asians are investing in Asia and the US... and Americans are investing in America and Asia. The Europeans are being killed on the international stage, from disinterest. Simply put, the price is too high to invest there. No forum comment would be complete w/o a little anecdotal evidence... and in that spirit... When's the last time you heard of a company's HQ being relocated to anywhere in the EU? Ever ask yourself why? |
| #21 By 28801 (65.90.202.10) at 2/28/2008 3:16:20 PM |
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I think we are overdue for an automobile metaphor.
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| #22 By 89249 (64.207.240.90) at 2/28/2008 4:19:55 PM |
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#18 Dave I never mentioned your first paragraph. So here it goes. The reason you are being "ripped off" is the protectionist stance the EU takes to imports/exports.
Its done under the guise that they are "protecting the consumers" but it really does nothing of the sort. By creating extra burdens on importers into your country other than regular market forces they are protecting internal companies. Believe it or not that is exactly what the MS Anti-Competitive Lawsuit is about. Ask anybody who is actually familier with the arguments and documents involved in the case. It was never proven that Microsoft's actions hurt the consumer. It was proven that it hurt the companies. The very same has been historically proven about the case against Standard Oil. Standard Oil brought about a 70% reduction in price in kerosene (spellcheck) to the consumer while still enjoying a healthy profit. And trust me the EU isn't the only entity guilty of such poor practices. The United States has been paying much more for Sugar for years because the Southern congressmen place large tariffs on sugar imports to protect Sugar Beat farmers. |
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