EU may demand Microsoft bundle rival browsers with Windows

The European Union (EU)'s antitrust agency may force Microsoft to include rival browsers in Windows, according to a regulatory filing submitted last week by the US software developer.

In a Form 10-Q document filed with the US Securities and Exchange Commission (SEC) last Thursday, Microsoft spilled some details of the charges that were leveled the week before by the EU's Competition Commission.

The EU said Microsoft "shields" Internet Explorer (IE) from "head-to-head competition" by bundling its browser with Windows. The Commission has not, however, made its accusations, dubbed a "Statement of Objections," public.

But Microsoft revealed some details of the charges.

"The Commission is considering ordering Microsoft and OEMs to obligate users to choose a particular browser when setting up a new PC," said Microsoft in its quarterly filing with the SEC, referring to the computer makers who preinstall Windows. "Such a remedy might include a requirement that OEMs distribute multiple browsers on new Windows-based PCs."

Microsoft also said that it may be required to disable "certain unspecified" parts of IE "if a user chooses a competing browser."

The company did not spell out what other browsers the EU might make Microsoft and its hardware partners offer within Windows, but presumably Opera -- the browser made by Norway-based Opera Software, which filed a complaint in December 2007 that prompted the Commission's move -- would be one.

IE's biggest rival is Mozilla's Firefox, which last month accounted for 21.3% of the browser market, according to data from Web metrics company Net Applications Inc.

Microsoft also said that the Commission will seek a "significant fine" based on Windows sales in the EU, perhaps from as far back as 1996, the date the antitrust agency said the alleged violation started. Microsoft began bundling IE with Windows in 1995, with the release of its Windows 95 operating system.

The EU has imposed nearly US$2.5 billion in fines on Microsoft since it ruled in 2004 that the company violated the law. The most recent fine, of $1.3 billion, was levied in February 2008 for business practices that the Commission said "continued to stifle competition" long after the ruling.

Competition Commission spokesman Jonathan Todd did not immediately respond to a request for confirmation on Microsoft's account of the Statement of Objections.

Previously, Microsoft has said it is "committed to conducting our business in full compliance with European law," and noted that it had until mid-March to respond to the charges.

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