Microsoft has been the subject of high-profile ongoing antitrust investigations and actions from both U.S. and E.C. authorities. The E.C. has investigated Microsoft for violations of its policies in at least ten separate antitrust actions stretching from 1993 to 2009 resulting in the company being fined over $2 billion, among various other remedies along the way. The FTC and DOJ have each investigated the company once, beginning in 1998 and leading to a single settlement in 2001 requiring limited sharing of intellectual property and unbundling of certain software products.
The Company
Microsoft's website states: "Founded in 1975, Microsoft (Nasdaq "MSFT") is the worldwide leader in software, services, and solutions that help people and businesses realize their full potential." Microsoft, headquartered in Washington state, was founded by Paul Allen and the sometime world's richest man, Bill Gates. The company develops a wide range of products and services relating to computing and entertainment. The company has produced such iconic products as DOS, Windows, Internet Explorer, MS Office products, and the Xbox gaming system. The company has created one of the world's best-known and most valuable brands, and even its critics would agree, has had an enormous influence on the path of development of computing and entertainment.
Antitrust action timeline
The E.C.'s website (with links to original documents included) states:
"The case originated with a December 1998 complaint from Sun Microsystems alleging that Microsoft was refusing to supply it with interoperability information necessary to interoperate with Microsoft’s dominant PC operating system. In February 2000, following information obtained from the market, the Commission broadened the scope of its investigation to examine Microsoft’s conduct with regard to its Windows Media Player product (see IP/00/141).
On 1 August 2000, on the basis of an initial investigation, the Commission sent Microsoft a Statement of Objections alleging that Microsoft was denying to disclose interface information which rival work group server operating system vendors needed to interoperate with Microsoft’s dominant Windows PC operating system (see IP/00/906).
On 30 August 2001, the Commission sent Microsoft a second Statement of Objections. This: (i) confirmed and expanded the interoperability objections of the first Statement of Objections, in particular by taking into account Microsoft’s recently released Windows 2000 generation of PC and server operating systems; and (ii) alleged that Microsoft had engaged in anti-competitive tying of its Windows Media Player product with its Windows PC operating system (see IP/01/1232).
On 6 August 2003, on the basis of additional evidence that the Commission had gathered, a third Statement of Objections confirming both the interoperability and tying objections of the second Statement of Objections was sent to Microsoft (see IP/03/1150).
Microsoft provided responses to each Statement of Objections. In addition, following the third Statement of Objections, Microsoft requested an Oral Hearing. This was held on 12-14 November 2003.
Following an extensive analysis of the evidence on the file, the Commission concluded its investigation on 24 March 2004 by way of a Decision (“the Decision”) (see IP/04/382 and MEMO/04/70).
This Decision found that Microsoft had abused its dominant position in the PC operating system market by:
- refusing to supply competitors in the work group server operating system market interface information necessary for their products to interoperate with Windows, and hence to compete viably in the market. The Decision ordered Microsoft to disclose, within 120 days, complete and accurate interface information which would allow rival vendors to interoperate with Windows, and to make that information available on reasonable terms;
- harming competition through the tying of its separate Windows Media Player product with its Windows PC operating system. The Decision ordered Microsoft to provide, within 90 days, a version of Windows which did not include Windows Media Player.
See a summary of the Decision. The full text of the Decision is available in English and French in the case page."
In May 2008, the E.C. announced its intention to investigate Microsoft's foray into open-source software. Eight months later, the E.C. announced it would investigate the bundling of Internet Explorer with Windows operating systems from Microsoft, saying "Microsoft's tying of Internet Explorer to the Windows operating system harms competition between web browsers, undermines product innovation and ultimately reduces consumer choice."
Microsoft responded by agreeing not to bundle Internet Explorer with Windows 7 E, the European version of Windows 7. On December 16, 2009, the European Union agreed to allow Microsoft to release Windows 7 E in Europe on the condition that it have a screen letting users choose one of twelve popular browsers listed in random order.
Sources:
Summary of the EC's investigation of Microsoft (1998-2003) from the EC website
Ex-Judge in Microsoft/EU Case Surprised at Fine by David Lawsky, Reuters. 22 May 2008.
Antitrust: Commission confirms sending a Statement of Objections to Microsoft on the tying of Internet Explorer to Windows from the E.C. 'Europa' site.
EU Says to Study Microsoft's Open-Source Step Reuters. 22 May 2008.
European version of Windows 7 will not include browser by Bobbie Johnson of guardian.co.uk. 12 June 2009.
In May 2008, the E.C. announced its intention to investigate Microsoft's foray into open-source software. Eight months later, the E.C. announced it would investigate the bundling of Internet Explorer with Windows operating systems from Microsoft, saying "Microsoft's tying of Internet Explorer to the Windows operating system harms competition between web browsers, undermines product innovation and ultimately reduces consumer choice."
Microsoft responded by agreeing not to bundle Internet Explorer with Windows 7 E, the European version of Windows 7. On December 16, 2009, the European Union agreed to allow Microsoft to release Windows 7 E in Europe on the condition that it have a screen letting users choose one of twelve popular browsers listed in random order.
Sources:
Summary of the EC's investigation of Microsoft (1998-2003) from the EC website
Ex-Judge in Microsoft/EU Case Surprised at Fine by David Lawsky, Reuters. 22 May 2008.
Antitrust: Commission confirms sending a Statement of Objections to Microsoft on the tying of Internet Explorer to Windows from the E.C. 'Europa' site.
EU Says to Study Microsoft's Open-Source Step Reuters. 22 May 2008.
European version of Windows 7 will not include browser by Bobbie Johnson of guardian.co.uk. 12 June 2009.
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