You can't blame EU officials for being skeptical about Microsoft's sincerity. While the U.S. Justice Department long ago caved before Redmond's intransigence, the Eurocrats have single-mindedly pushed the world's largest software company to make the playing field a little more flat. And, as they pointed out yesterday after Microsoft's latest promise to be more open and to make its products work more easily with those of competitors, they've heard it all before.
Maybe it is time to give Microsoft the benefit of the doubt. Even if the steady pressure from Europe has pushed  the company the right direction. After all, the bigger challenge to Microsoft comes not from regulators but from the Internet. For years, Bill Gates used to coyly say that what kept his company on its toes was that consumers could switch to someone else's products. But when you control 90 percent of the market,  he knew that they didn't have many other options.
The emergence of Web-based applications has shaken up Microsoft's world. Consumers can, in fact, go elsewhere as easily as a click on their browser. Companies like Salesforce, Netsuite and Google have created online products that present a credible choice to consumers and companies. You can do word-processing, spreadsheets, presentations, databases and manage customer relations using your browser and free, or nearly free, software on the Web.

For years, Microsoft saw Web-based applications as a threat to its nice fat packaged software business. And as long as it was just the early adopters who bothered with on-demand apps, the boys in Redmond could dismiss the crude online challengers.
But as I keep saying, Gates and Ballmer may have been pigheaded, myopic,  even ruthless, but they didn't diet on stupid pills. When Salesforce.com's Mark Benioff started chanting, "The End of Software," somebody at Microsoft must have listened.
One of Microsoft's most significant acquisitions was Ray Ozzie, now the company's chief software architect. We won't hold it against Mr. Ozzie that he created Lotus Notes, a classic example of packaged software bloat that IBM still foists on unsuspecting customers. That wasn't why Gates and Ballmer pulled him in.
If you want to see the future of Microsoft, look at Groove, the startup Ozzie built after Notes. Groove was an on-line collaboration platform that allowed users to quickly create shifting groups of workers with finely-controlled access. They could share documents, edit them together, hold meetings and discussions while they looked at documents.
What Mr. Ozzie brought to Microsoft was a sense that the Internet did not have to be the enemy and could be a credible software platform. I bet that this latest pronouncement about opening up the code, enabling closer collaboration with competitors, and bringing Microsoft closer to the "open source" model is greatly influenced by Mr. Ozzie.
You can see some of Microsoft's evolution in Microsoft Office Live, it's suite of online applications for small business (http://smallbusiness.officelive.com) After a rocky start, Microsoft Live is becoming a real player on the on-demand world, providing web design, CRM and other functions free and/or cheap. It's not perfect, there are still annoying Microsoft-only limitations, like putting your business search keywords only on MSN. But that will evolve with time - and consumer pressure.
Microsoft's latest action - publishing 30,000 internal documents, opening up the protocols, promising to make licenses readily available - is a risk for the company. But clearly, the braintrust has decided that it has no choice. For a company like Microsoft, there is something worse than being hated. It's being considered irrelevant. And that is probably a greater motivator than those pesky European bureaucrats.