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Thursday, March 4, 2004

EU order may specify two versions of Windows

By PAUL GEITNER
THE ASSOCIATED PRESS

BRUSSELS, Belgium -- Going beyond Microsoft Corp.'s settlement of U.S. antitrust charges, the European Union wants to force the software giant to offer computer makers a version of Windows without any multimedia program to give rival companies a better chance at getting their products on consumers' desktops, sources said yesterday.

Such an order -- expected this month barring a last-minute settlement -- would be sure to be instantly challenged in European courts by Microsoft. The company insists removing its Media Player program would compromise other parts of its flagship operating system.

Taking out Media Player also could undermine Microsoft's long-term strategy of keeping Windows on top by incorporating new functions, which it argues benefits consumers.

Rivals from Netscape to RealNetworks have repeatedly challenged the practice as unfair competition.

European Commission spokeswoman Amelia Torres declined to comment on specific remedies.

But, she said, "the draft decision contains clear remedies to the identified illegal conduct, remedies which will restore a competitive marketplace for consumers in Europe."

A Microsoft spokesman also declined to comment on details, repeating only the company is "working actively with the European Commission toward an amicable settlement of this case."

The EU already has made a preliminary finding that Microsoft violated EU competition law by bundling its multimedia software into Windows, and by failing to provide competitors in the server market with enough programming code to allow their products to operate as well with Windows as Microsoft's own.

To resolve the first abuse, the draft decision sent to national regulators for review last month would require Microsoft to offer computer manufacturers two versions of Windows: one with Media Player and one without, according to sources familiar with the case.

Yet although the order would apply only to computers sold in Europe, Competition Commissioner Mario Monti sees the market as big enough to affect Microsoft's behavior worldwide.

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