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Microsoft fine further weakens U.S.-Europe relations

It took Mario Monti five years to prepare his antitrust case against Microsoft. It'll take the European Union another five years to collect the fine it levied against the software maker this week.

That's how long Microsoft's chief counsel predicts that the appeals process in this case will take. By then, Windows will have a whole new look, and bundled media players will sound like a quaint idea from the old days.

Still, the 497.2 million euro fine -- which converted to $604.80 million today, but has been reported to be as high as $613 million -- is an outrageously severe penalty that sends a chilling message to American companies that do business in Europe: The EU will tolerate anticompetitive practices from its own, as evidenced by the state subsidies that provide Airbus with an artificial advantage over Boeing, but it will punish outsiders guilty of lesser offenses.

Concessions rebuffed

The surprising thing about this case is that Microsoft was willing to make major concessions to appease Monti and his team. The Seattle Times quoted Microsoft lead attorney Brad Smith as saying that, during negotiations, Microsoft offered to ship rival media players with Windows -- in both the European and U.S. markets. Since Microsoft's media player appeared to be a key element of the investigation, why did the EU spurn that offer?

While it doesn't look as though the EU sanctions will change Microsoft's plans for the Longhorn version of Windows, other technology companies could get caught in the crossfire, since this case is likely to touch off an ugly trade standoff that will exacerbate the already-strained relations between the United States and much of Europe.

Meanwhile, Microsoft lost another battle in court. Over the objections of Redmond and others, a federal judge ruled that lawyers for Oracle can take a look at its rivals' sensitive corporate data. The federal government says that Oracle can only use the information to defend itself in the PeopleSoft takeover case, not to gain a competitive advantage. In a related development, the Brooklyn Bridge is up for sale to anyone who believes that Oracle won't abuse access to those documents.

Talking about speech

At the VSLive conference on Wednesday, Microsoft chairman and chief software architect Bill Gates officially launched the company's new speech recognition software, Speech Server 2004. Gates said that the product will be converged with its mobile technologies and with the Visual Studio development environment. He also provided some details for Visual Studio 2005, which is about a year away from release, but will be available for preview soon in prerelease form.

Management software is another product set that Microsoft has been talking a lot about lately. At the recent Microsoft Management Summit, the software maker announced that it will develop MOM Express 2005, a streamlined version of Microsoft Operations Manager, its server management product. Now, it appears that its desktop management technology will get the "light" treatment as well.

SMS 'lite' likely

In an interview with, Microsoft vice president Kirill Tatarinov said that his company will develop a more-simplified version of Systems Management Server that targets "IT generalists." The current version of SMS, Microsoft admits, requires the skills of hard-core SMS pros.

This week, Microsoft got jilted by longtime partner Hewlett-Packard, which cut a major deal with open source heavyweight Novell to distribute Linux on HP hardware. HP officials tried to play down the notion that the deal will hurt Microsoft's bottom line, but one analyst said that it could force Microsoft to lower the price of Windows to stay competitive.


It's official: EU fines Microsoft $611 million

Oracle allowed to view rivals' sensitive data

Gates adds his voice to speech, developer message

SMS for the enterprise outpost

HP move could change Microsoft strategy

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