The Commission on Wednesday (27 February) imposed a new record fine of 899 million euros on Microsoft for abusing its dominant position, raising the bill charged to the Redmond software giant thus far to almost 1.7 billion euros.
Competition Commissioner Neelie Kroes has decided once more to act against Microsoft because of the “unreasonable” fees imposed by the company between 2004 and 2007 on its software licenses and for the release of information on its products. Brussels had specifically asked Microsoft to provide technical information to its competitors in order to allow them to build compatible software.
Microsoft had demanded a royalty rate of 3.87% on product revenues for patent licenses and of 2.98% for information licenses. Despite the first Commission decision of March 2004, Microsoft kept prices unmodified until 21 May 2007 when they were reduced. However, the Commission considers that the Redmond company has only been in line with its demands since 22 October 2007, when it set the price for access to interoperability information at a flat fee of €10,000.
“The Commission’s fine is a reasonable response to a series of quite unreasonable actions,” commented Commissioner Kroes recalling “Microsoft’s record of non-compliance”. Indeed, with the fine received in 2006, the IT giant has been the first company in 50 years to be fined for not abiding to a Commission decision. In this particular case, Brussels is condemning the insufficient information provided by Microsoft to competitors in order to close the gap opened by the first Commission decision of 2004.
In addition, Kroes stressed that there are two ongoing investigations to verify anti-competitive practices carried out by Microsoft in other markets. “These investigations are separate and continuing,” said the Commissioner at a press conference in Brussels.
And problems are probably not over for the US software giant. Last January, the Commission decided to open two antitrust enquiries to verify the interoperability of core Microsoft products, including Office Suite, and the legality of bundling the browser Internet Explorer to the Windows operating system.