by Anam Alpenia, Red Herring
The EU Competition Commission has ruled that Microsoft failed to comply with a 2009 ruling mandating it to offer a choice of web browsers, which could mean a hefty fine of up to $7.4 billion, about 10 percent of the computer giant’s revenue in 2012, Reuters reported. Following its investigation that began last July, the commission is compiling formal charges.
It’s the second time the company has failed to comply with an EU mandate. The last one stemmed from Microsoft’s failure to provide essential compatibility information to rival developers in 2008 and cost the company $1.28 billion in fines.
In a 2009 deal with regulators to settle an anti-trust case and avoid a penalty, Microsoft agreed to offer a series of browser alternatives through a ballot-style “choice screen,” which included such default options as Firefox, Safari Chrome, Opera or another browser. The company complied until the February 2011 release of Windows 7 service Pack 1, which did not offer the ballot choices.
‘”The fault is there, it has been there for more than a year and it is clear that we need to react,” stated European Competition Commissioner Joaquin Almunia. “It is not only the distortion of competition during this period which concerns us; it is very serious, from my point of view, that the remedies imposed on Microsoft have not been applied.”
Microsoft admitted to the breach, but blamed it on a “technical error.”
“While we believed when we filed our most recent compliance report in December 2011 that we were distributing the [browser ballot] software to all relevant PCs as required, we learned recently that we’ve missed serving the [browser ballot] software to the roughly 28 million PCs running Windows 7 SP1,” Microsoft said in a statement.
The company distributed an update to reinstate the browser ballot and offered to extend the length of its agreement with the commission for an additional 15 months, GeekWire reported.
The commission will open formal proceedings into the company’s breach of its agreement, a process not expected to take long as “the company itself explicitly recognized its breach of the agreement,” Almunia stated.
The use of Explorer has been slipping over the last several years due to competition with Google Chrome, with use in Europe roughly halving since 2008 to 29 percent this year, according to web research firm Statcounter. Chrome, meanwhile, holds 29.3 percent, while Mozilla’s Firefox holds 30.3 percent.
Google, meanwhile, faces its own pressures from the commission, which charges that the search engine has also engaged in anti-trust practices to deliver its search results.