Microsoft Corp v. Commission , European General Court case brief summary

EUROPE: Microsoft Corp v. Commission , European General Court, 2004 p. 333

 

Holding: violation

Issue: Whether bundling of media player violated antitrust, done to prevent competition from Real Networks.

Reasoning: Duty to deal is an exception where there is intellectual property. Duty to deal only if:

         i.            access indispensable to competitors [competition not consumers]

       ii.            refusal must exclude any effective competition on a neighboring market

      iii.            must prevent the appearance of a new product for which there is potential consumer demand

     iv.            D must then show an objective justification

MSFT ensured that competitors' work group server OSes could not attain interoperability. consumers preferred non-MSFT work group servers but were prevented from using them.

Bundling the media player: mkt share data shows that before bundling MSFT player, MSFT bundled Real Networks' player. Once MSFT had a player that was good enough it switched, giving MSFT player access to MSFT's 93.8% share of the PC OS mkt.

MSFT claimed efficiency justifications but the Commission rejected those arguments + Court agreed.

Order: Required interoperability OR stop bundling. MSFT chose to continue bundling. EU fined MSFT €3 Million. Ct. Justice affirmed commission's fines.