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03.29.2004
Originally featured on BroadcastEngineering.com
Windows Media technology gets global setback

The 15-nation European Union’s ruling against Microsoft last week could seriously inhibit the computer giant from making its Windows Media Player the global standard for the consumer playback of electronic media on personal computers.

If ultimately successful, the union could also undercut Microsoft’s efforts to establish its Windows Media 9 technology as a computing global broadcast standard. Microsoft could no longer claim that it possesses a ubiquitous media player in use throughout the world.

In a ruling that found Microsoft is abusing it status as a “near monopoly,” the EU went far beyond a $603 million fine and any restrictions imposed in the U.S. case against the software maker. It ordered Microsoft within 90 days to offer a version of Windows with its media playing software stripped out.

The commission also gave the company 120 days to disclose the necessary information about Windows to rival makers of computer server software to allow them to design products that work as easily with Windows as Microsoft’s own server software does.

The finding threatens the way Microsoft does business in the European Union, a $3 billion market that is soon to include 25 countries. It puts Microsoft on notice that future attempts to add features to Windows could be legally challenged in Europe if the additions put rival products at a competitive disadvantage.

The ruling is intended to ensure that “anyone who develops new software has a fair opportunity to compete in the marketplace,” EU competition commissioner Mario Monti said in Brussels.

EU officials hope to establish what has eluded Microsoft’s competitors in the U.S. for more than a decade. That is a binding legal precedent to limit the company’s practice of constantly incorporating new applications such as the Media Player into the Windows operating system, then capitalizing on Windows’ nearly universal distribution to overwhelm rival products.

The ruling comes as Microsoft is working on technology that goes beyond simply playing music and videos in its operating system. It has already demonstrated new 3D software that makes it easier to store, catalog and retrieve audio and video clips in Longhorn, the code name for the next version of Windows. Combined with Media Player — either packaged with Longhorn or offered separately — the next generation software could give Microsoft a decisive edge over RealNetworks, Apple Computer and other competitors.

Before the EU, Microsoft said removing the Media Player from Windows would harm the operating system’s internal workings, disabling 20 related functions. The EU disagreed.

The practice of “tying” is what the EU called Microsoft’s practice of bundling its media playing software in Windows.

Vowing to appeal the order, Microsoft now faces the prospect that at least in Europe it cannot add features to future versions of Windows. The fight moves to the European Court of First Instance in Luxembourg, where appeals to such commission decisions are filed. Resolution of the case could take five years.

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