Microsoft details EU concessions

The Commission, the European Union's antitrust watchdog, has responded positively to the move.

Last week, the software giant sent an expanded set of concessions to the Commission regarding its plans to separate the Windows Media Player from the Windows operating system. As part of the expanded agreement, Microsoft pledged to implement a new interoperability strategy on a worldwide basis, rather than just within EU nations.

In March 2004, the Commission fined Microsoft 497 million euros ($610 million) for violating EU antitrust law. The Commission ordered the company to unbundle Media Player from Windows. Under interoperability demands, the Commission also ordered Microsoft to share information with rival makers of servers used to run printers and retrieve files, so that Microsoft's system will work with software products from other companies.

Since then, European antitrust regulators have been at odds with Microsoft over its efforts to comply with the order. Last week, the company faced a deadline to submit its final proposal for complying with the antitrust order.

As part of the EU's interoperability demands, Microsoft's proposals for compliance will now be "market tested" with other companies to help the Commission make a final assessment.

In addition, Microsoft said that it will create a new royalty structure for the licensing of its Windows protocols for use in other developers' software products, adding more plans and customization options to those programs than it had offered in the past. As part of that effort, the company said that a "category of the information which it is obliged to disclose" will be done so royalty-free.

"In order to resolve some complex issues over the past few weeks, we've made some tough concessions," Steve Ballmer, chief executive at Microsoft, said in a statement Monday. "We take our responsibilities in Europe very seriously and will continue to focus on fulfilling all our obligations in every way we can."

Microsoft faces significant fines if the EU decides that the company's efforts to allow non-Microsoft workgroup servers to achieve full interoperability with Windows PCs and servers don't work. The Commission has said previously that it could fine the software maker up to $5 million per day.

However, EU officials responded positively to Microsoft's latest step and said the company appears to be moving in the right direction.

"I am happy that Microsoft has recognized certain principles which must underlie its implementation of the Commission?s decision," European Competition Commissioner Neelie Kroes said in a statement Monday. "I remain determined to ensure that all elements of the decision are properly implemented. This includes the ability for developers of open source software to take advantage of the remedy."

One topic not addressed in the latest set of allowances from Microsoft is the EU's request that the company create open-source licensing for some of the technologies involved in the ruling. The Commission said that such licenses should be made available for protocols that do not represent product innovations. Microsoft has yet to capitulate with that request.

Reuters contributed to this report.