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Tuesday, January 24, 2006
Microsoft Gets Three Weeks to Reply on Fine Proposal

Microsoft said on Monday it had been given extra time by the European Commission to respond to the threat of a $2 million-a-day fine over allegations that it has failed to comply with a landmark EU antitrust ruling.

"We have been granted an extension to February 15," a spokesman for the company said.

The extension comes as antitrust authorities in the United States questioned whether the company was doing enough to comply with a 2002 antitrust settlement with the U.S. government.

The U.S. Justice Department said on Monday that delays were holding up efforts to verify documentation for protocols that rival companies need to make their products work with Microsoft's Windows computer operating system.

The European Commission also has complained about the quality of documentation for Windows protocols.

In a decision last month, the Commission had given Microsoft until Wednesday to reply to the charge that it had failed to share information on office servers with its competitors as ordered by Brussels.

In March, 2004, the Commission imposed a 497 million euro fine on the company and required it to offer a version of Windows computer operating system without audiovisual software, because it had competed unfairly against rivals.

Microsoft also was supposed to offer rivals so-called protocols, or rules of the road.

That would enable rival makers of server software that helps manage tasks like printing within a group of desktop machines to work as well with Windows as Microsoft server software does.

The Commission said late last year Microsoft had provided inadequate documentation for the protocols and was charging too much for them.

Microsoft has given reasons for its charges and the Commission says the reply is still being analyzed. If the Commission accepts the explanation the fine could be reduced.

In the United States, the Justice Department said the company had fallen behind on some of the technical work needed to comply with the landmark antitrust settlement there.

Microsoft is required to license key computer protocols to other companies under terms of the U.S. settlement.

In a filing on Monday in U.S. District Court for the District of Columbia, the department cited Microsoft delays that it said were holding up efforts by an outside panel of technical experts to test and verify the documentation.

Since mid-November Microsoft has not been responding quickly enough when the outside panel has asked it to fix or explain bugs in the documentation, the department said in the filing with U.S. District Judge Colleen Kollar-Kotelly.

"Microsoft needs to dramatically increase the resources devoted to responding to technical documentation issues in order to get its performance under the SLGs (timetables) back on track," the department.

The department also said Microsoft had provided bad information that caused problems at a testing lab in India, which also was being designed to verify the accuracy of Microsoft protocols.

In a January 17 filing with the court, Microsoft said it was working hard to comply but said it was having "substantial difficulties finding and hiring competent employees with the necessary experience in and training for these highly specialized tasks."

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