In the European Union's first financial penalty against a company for defying
antitrust orders, EU
regulators fined Microsoft
Corp. 280.5 million euros ($358.3 million) and indicated the company's problems in Europe could get worse.
Regulators also vowed to impose higher penalties if the company doesn't cooperate with their 2004 order to end anticompetitive business practices. Rival companies, meanwhile, are preparing to add arguments to their complaint alleging unfair practices in Microsoft's next versions of its Windows computer operating system and Office software suite, and the EU is promising to monitor those products closely.
Ms. Kroes said the company has been producing higher quality
technical information since April -- a change she attributed to disciplinary hearings regulators held in Brussels in March. The Redmond, Wash., company has until July 18 to hand in the last of its revamped manual. Ms. Kroes said she will reserve judgment on the new material until her technical advisers have tested it. The commission recently adopted guidelines that would let it mete out higher fines after July 31 if it finds Microsoft's response inadequate.
Microsoft is working under court order on a similar project with the U.S. Department of Justice, which in 2002 settled its
antitrust case against Microsoft without leveling fines. The department is using the EU format for the technical manual, with modifications.
Microsoft isn't out of the woods on another matter: the licensing and royalty terms it will offer rivals to use its technical manual. Regulators have said they will level fines against the company if it finds the licenses are too restrictive. The EU decision could further embolden other U.S. companies to vent their antitrust gripes in Europe, Mr. Di Bona said. "It creates a temptation for people to use the EU as a legal venue to challenge Microsoft," he said.
Already, an industry group that includes International Business Machines Corp., Sun Microsystems Inc. and Adobe Systems Inc. is preparing to update by the end of the summer a formal complaint it filed in February that alleged Microsoft plans to install features in its next version of Windows, dubbed Vista, and in Office 2007 that will hobble competitors.
Among the group of rivals' concerns is that new encryption software Microsoft may install in Vista could make Word documents hard to read by people using IBM or Sun's word-processing software.