Hardware Geeks

Today the EU has levied a new fine against Microsoft, and this time it is a big one. 1.3 billion is the fine amount and it is the largest ever fine against a single company, and double the amount Microsoft was fined by the EU in March 2004. It is also the first time the EU has fined a company for not obeying an antitrust order.

Microsoft has already said that these fines are about past issues that have been resolved, and the EU agrees saying these fines are for practices prior to October 22nd 2007, three years after Microsoft was ordered to change their ways.

The fines are over the way Microsoft charged software developers who wanted to make their products compatible with the Windows Operating system.

Prior to March 2007 Microsoft charged software developers a royalty rate of 3.87% for patents on a licensed products revenue, and companies who were seeking highly secret information according to Microsoft were charged 2.98% on their products revenue.

The EU said those rates were unfair and Microsoft lowered their rates in the EU 2 months later, to 0.7% and 0.5% respectfully and left the global rates the same. The EU still didn’t like that change and Microsoft again changed the rates in October 2007 when Microsoft changed the royalty fee to a flat $14,000 and an optional worldwide patent license at 0.4%.

Some Microsoft enthusiast who I have talked to today, believe the EU is abusing their power.
“I have very little respect for the EU and I am not just saying that because I like Microsoft, I say it as a Swiss national” said a Microsoft MVP who wished to remain anonymous.

“It’s their OS, if they want to reduce their competitiveness by over charging developers and pushing them away from the Windows platform, it’s really their choice. The lack of understanding from the EU is not going to help the developers at all.” said Paul White a British Citizen who works for the University of Manchester.

Josh from WindowsConnected.com on the other hand thinks the fine seems like some random number the EU pulled out of the hat and wonders what made them come up with that number.

I personally think, if Microsoft took 3 years to change their ways that sure they should have been fined, but I do believe 1.3 billion is excessive and if Microsoft were a European company the fine would have been much less. But Microsoft did drag their feet on the issue and I guess the EU wasn’t having any of it, but at the same time Microsoft needs to protect their intellectual property.

I spoke with Mary J Foley about the issue and I was surprised to find out from her that the EU only fined Microsoft 60% of what they legally are allowed to fine them.

Some US law makers were angry at the EU when they fined Microsoft 613 million 3 years ago, there will probably be some more angry ones after today.

At the start of trading on Wall Street today, Microsoft Stock imediately dropped 21 cents. As of 9:08 am, the Microsoft stock price was $28.38.

What do you think about the fine?

Post Tags: microsoft  fines  eu  patents  windows 

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