European regulators have announced that they are fining Microsoft 561 million Euros, which works out at around $732 million US dollars at today’s exchange rate, for breaking an antitrust agreement.
The agreement was originally made in 2009 between Microsoft and the EU regulators. Microsoft has been fined because they failed to make the browser choice screen that they had agreed on available with Windows 7 Service Pack 1 from May 2011 until July 2012.
Background of the Antitrust Agreement
The 2009 agreement was a significant milestone in the ongoing efforts to ensure fair competition within the software industry. At the heart of the issue was Microsoft’s practice of bundling its Internet Explorer browser with its Windows operating system. This bundling was seen as giving Microsoft an unfair advantage over other web browsers, which led to the antitrust investigation by the European Commission.
To resolve the issue, Microsoft agreed to provide a “browser choice” screen to Windows users in Europe. This screen was intended to allow users to select from a list of competing web browsers, thereby promoting competition and giving consumers more freedom of choice. The agreement was legally binding, and Microsoft was expected to adhere strictly to its terms.
Details of the Non-Compliance
Despite the clear terms of the agreement, Microsoft failed to include the browser choice screen in Windows 7 Service Pack 1 from May 2011 until July 2012. This omission affected millions of users who were not presented with the option to choose an alternative browser, thereby undermining the spirit of the agreement.
Commission Vice President in charge of competition policy Joaquín Almunia said: “In 2009, we closed our investigation about a suspected abuse of dominant position by Microsoft due to the tying of Internet Explorer to Windows by accepting commitments offered by the company. Legally binding commitments reached in antitrust decisions play a very important role in our enforcement policy because they allow for rapid solutions to competition problems. Of course, such decisions require strict compliance. A failure to comply is a very serious infringement that must be sanctioned accordingly.”
The fine of 561 million Euros is one of the largest ever imposed by the European Commission for non-compliance with an antitrust agreement. It serves as a stern reminder to all companies about the importance of adhering to legally binding commitments. The European Commission’s decision underscores its commitment to maintaining a competitive market environment and ensuring that no company can gain an unfair advantage through non-compliance.
The impact of this fine on Microsoft is significant, not just financially but also in terms of its reputation. It highlights the importance of corporate accountability and the need for companies to follow through on their commitments. For consumers, the enforcement of such agreements is crucial as it ensures that they have access to a variety of choices and are not limited by the monopolistic practices of a single company.
You can find out more information about the fine over at the European regulators website.
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