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Microsoft continues battle v EU Commission in court

Written by: Staff
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LUXEMBOURG, Apr 25 : Microsoft faces questioning from judges on Tuesday about its contention that a landmark European Commission antitrust decision denied the software giant's right to compete and innovate.

A special 13-judge panel at Europe's second-highest court, the Court of First Instance, is expected to decide whether the Commission was right to find the software giant abused its near monopoly to elbow out competitors.

A ruling against the Commission could curtail its power as Europe's top competition watchdog and allow Microsoft to pursue the business practices that have helped it become a household name around the world.

The Commission's decision said Microsoft behaved unfairly in bundling its Windows operating system -- used by 95 percent of the world's PCs -- with its own media player software, thus killing consumer's incentive to buy other player software.

Microsoft argued that consumers had benefited from the improved operating system in which the media player was part of a natural evolution and that in contrast to the Commission's predictions; competition in the industry was thriving.

But on Monday, Microsoft's rivals presented memos swapped between the company's top brass including Bill Gates, which, they said, showed it planned to shoot down the then top media player provider, RealNetworks, in the same way it demolished former internet browser provider Netscape.

''(RealNetworks) is like Netscape. The only difference is we have a chance to start this battle earlier in the game,'' one executive is cited as saying in a memo sent after a meeting with Gates and others.

A U.S. court ruled in 2001 that Microsoft's bundling of its own Internet Explorer browser was illegal.

The memos overshadowed the rehearsed presentations, drowned in technical detail, of the Commission and Microsoft, both of whom called each others' arguments flawed and speculative.

On Tuesday, the judges will have an opportunity to ask all involved questions.

On Wednesday and Thursday judges will look into a part of the Commission's decision dealing with what it says is Microsoft's failure to give information that would help rivals create software able to run with Windows as smoothly as Microsoft's own software.

Here, Microsoft will argue that it has given plenty of server software information away and that providing more would infringe its intellectual property rights on innovations that it has worked long and hard to develop.

A decision in the case is not expected for months, possibly a year.

The Commission's power as Europe's premier competition regulator has already suffered three court reversals in smaller cases. Another defeat would be a huge blow to its prestige.

But if the Commission wins, it will take more action.

Competition Commissioner Neelie Kroes has already written to Microsoft Chief Executive Steve Ballmer seeking information about the company's forthcoming new Windows version, Vista.

Reuters

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