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Tuesday, September 19, 2006
EU's Kroes Denies Vendetta Against Microsoft

EU antitrust chief Neelie Kroes on Tuesday rejected an accusation she was pursuing a vendetta against Microsoft and said she suspected a "coordinated campaign" to discredit her agency.

"Far from pursuing a vendetta against Microsoft, the Commission's actions are guided by the desire to create the most innovation-friendly business climate in Europe to the ultimate benefit of European consumers," the EU Commissioner wrote in a letter published by the Financial Times.

She was responding to a letter published by the newspaper from a Microsoft business partner who accused the EU Commission of "playing games" with Microsoft by raising concerns over the Vista operating system that could delay its launch in Europe.

Last week, Microsoft urged the EU's executive arm to detail why it was concerned about Microsoft foreclosing competition in computer security by tying new security features into Vista.

"There appears to be a coordinated campaign to portray the Commission in a negative light," she said, noting she had seen it suggested that the EU executive might seek to stop Microsoft improving the security of the system.

Microsoft, which hopes the Commission will not require removal of security features in Europe, said the new product remained on course for a public launch in January, but warned that any delay could halve the number of anticipated new jobs.

A Microsoft-commissioned study last week said Vista could drive $40 billion in economic activity and create 100,000 new jobs in six European countries next year.

The stand-off between the software giant and the Commission is the latest in a lengthy spat between the two.

In 2004, the Commission found Microsoft had abused its market dominance in audiovisual software players and office servers. It forced the U.S. firm to strip out Windows Media Player from its ubiquitous operating system.

The Commission levied a record 497 million euro ($629 million) fine. In July, EU regulators fined the company a further 280.5 million euros for defying the ruling, which required it to share information on its servers with rivals.

Microsoft faces a further fine of up to 3 million euros a day if found still not in compliance with the ruling.

Sources within Microsoft say the Commission is taking the issue personally, but Kroes denies this.

"This is categorically not the case," she wrote in her letter on Tuesday.

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