Despite Compliance, Microsoft Not Giving Up the Fight

Microsoft Corp. on Wednesday said it will take immediate steps to provide secret server communications protocols to competitors and to provide a version of Windows without an integrated media player, in compliance with the decision of the European Competition Commission, upheld by the European Union’s Court of First Instance.

Nevertheless, the company is keeping its options open on whether it files an appeal with the European Court of Justice, something it can do any time in the next two months. If Microsoft does appeal and wins its request for a delay in implementing the Commission’s remedies, the company would then be able to withdraw its protocol licensing program and the stripped-down version of Windows.

Microsoft’s first step will be to publish a Web site on Wednesday offering competitors access to communications protocols specified by the Commission. Microsoft has already done something similar to comply with a 2002 U.S. antitrust decision—it offers Windows client protocols for license under the Microsoft Communications Protocol Program (MCPP). These protocols are available for worldwide license, so that European companies already have access.

The Commission’s decision adds another category of protocols for license: Windows server protocols. “Under the Commission’s decision, we are obligated to make those protocols available for license, so that they can be implemented in competing server software,” Microsoft General Legal Counsel Brad Smith told eWEEK.com at a Wednesday press conference.

Read more here on Microsoft’s decision to comply with the EU remedies.

He said the new protocols will be made available through a subpage of the existing MCPP site or on a separate site. “As with the U.S. consent decree, there will be a number of steps companies will need to go through to license these protocols,” Smith said. Microsoft will apply its experience with the U.S. program—which has 20 licensees—to the European program, he said.

Microsoft will also begin distributing a version of Windows without an integrated media player to EU PC manufacturers. Using this software, manufacturers could choose to offer PCs without any media player, or possibly incorporate media players from competitors such as Apple Computer Inc. or RealNetworks Inc. “We have a timetable agreed upon with the European Commission. We will complete the final stages of testing, then it will be made available to manufacturers in January,” Smith said. After that it will filter through the rest of the distribution channel, and “retailers should have it by February,” he said.

Smith said Microsoft doesn’t yet have any projections on the degree to which unbundled versions of Windows will penetrate the market, but the company—and some analysts—are skeptical that it will see much demand. “Only time will tell whether there is significant consumer demand for this product,” he said.

Microsoft still believes it has a strong chance of ultimately winning its case—a process that could take four or five years—pointing out that CFI President Bo Vesterdorf agreed with many of Microsoft’s arguments. Until the wider case is decided, no legal precedent has been set that affects Windows, Smith said.

For more on Judge Vesterdorf’s decision, read “Judge: Why Microsoft Lost.”

“Today’s decision doesn’t in itself create such a precedent,” Smith said. “On the contrary, the court acknowledges that there are not one but four substantial arguments we have raised on the merits [of the case], any one of which could enable us to prevail. I’m not suggesting victory is guaranteed for anyone, [but] these factors give us cause for optimism.”

Even as it is moving forward with compliance, Microsoft is also “moving forward with the litigation, with the goal … of persuading the court that at the end of the day, on its merits, this is a case that should come down on our side,” he said.

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