Europe’s Technology Problem: The EC

European Competition Commissioner Neelie Kroes is touring the United States this week. Her visit comes during a nasty spat between the commission and Microsoft that could seriously hurt technology businesses and consumers.

Microsoft is planning to launch its new operating system, Windows Vista, in November for corporate clients and in January for consumers. Before launching in Europe, it hopes the EC will explain if there is anything in its software to which the commission seriously objects. Normally, a corporation shouldn’t have to get permission from a government body in order to launch a product, but in this case, Microsoft and the EC have a history that changes the norm.

In March 2004, the EC ruled that in addition to paying a record fine of 497 million euros (US$632 million), Microsoft had to sell a copy of Windows without Media Player software and hand over the specifics of its Windows server technology to rivals. Both these mandates were meant to correct Microsoft’s allegedly harmful market power.

The company appealed the decision, and in July, the commission slapped Microsoft with an additional fine of 280.5 million euros ($356.9 million) for supposedly not complying with its orders. Given this history, it isn’t hard to see why Microsoft would want to know in advance of its next product if the commission has problems with it. Unfortunately for everyone except EC bureaucrats, an answer will not arrive in the near future.


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