Microsoft faces EC fine for failure to comply with browser undertaking

The European Commission held out the threat of another hefty  fine against Microsoft yesterday, for its failure to offer 28 million European customers the ability to choose their web browser.
 
Microsoft immediately came out with an apology for ''technical error'' which left 28 million Windows 7 operating system users unable to choose between the company's default Internet Explorer and other browsers.
 
''While we have taken immediate steps to remedy this problem, we deeply regret that this error occurred and we apologise for it,'' Microsoft said in a statement.
 
In order to address EU's competition concerns in 2009, the software giant undertook to provide Windows users in Europe a ''choice screen'' allowing them to choose an alternative web browser until 2014.
 
However, a service pack 1 update to Windows 7 had not included the screen since February 2011.
 
''We have fallen short in our responsibility to do this,'' Microsoft said.
 
The executive arm of the EU announced an antitrust probe against Microsoft, which had already been fined hundreds of millions of euros in a separate case.
 
''We are now opening formal proceedings against the company,'' EU competition commissioner Joaquin Almunia told a news conference.
 
''If following our investigation this breach is confirmed, and Microsoft seems to acknowledge the facts here, this could have severe consequences,'' he added. ''If infringements are confirmed, there will be sanctions.''
 
A company that is found to be in breach of the legally-binding commitments could face fines of up to 10 per cent of total annual turnover.

In a report to Brussels on December 2011, Microsoft stated that it was complying with the 2009 commitments, but the company was breaking its pledge, Alumnia said citing "market players".
 
''I consider that commitments by companies themselves are a good way to solve competition problems... as an alternative to lengthy proceedings,'' he said. ''But this can only work if companies implement these decisions fully.''

Microsoft, in a report it submitted to the Commission in December, said the browser choice screen was being provided as required, and in its statement yesterday, the company said it believed at the time that was the case.

According to the company, it had retained outside counsel to conduct a formal investigation of how the technical error occurred and to make suggestions to avoid such compliance problems in the future.

The company added that it was offering an extension to the time period during which it was obligated to display the choice screen by an additional 15 months.

''We understand that the Commission will review this matter and determine whether this is an appropriate step for Microsoft to take,'' the statement said. ''We understand that the Commission may decide to impose other sanctions.''

The latest development comes after Microsoft agreed in 2009 to offer a choice of rival web browsers on Windows after rivals complained that attaching Internet Explorer to Windows was an unfair way for Microsoft to put its web software on most of the world's computers.

The competitive landscape has undergone a sea change since then, with tech companies now being more concerned about Google's and Facebook's dominance than Microsoft's. Meanwhile, rival browsers including Mozilla's Firefox and Google's Chrome have overtaken Internet Explorer, and apps on mobile devices have started to replace browsers as gateways to online content.