Microsoft, EU square off over antitrust

LUXEMBOURG — The European Commission forced the world’s largest software maker to offer a product no one wanted and no one bought, Microsoft Corp. told the EU’s second-highest court on Monday as it began trying to overturn a landmark antitrust ruling against it.

Microsoft lawyer Jean-Francois Bellis said in his opening statement that the Commission made “fundamental errors of fact and reasoning” in its decision two years ago that the company abused its dominant market position to muscle into media software.

The Commission’s order that Microsoft offer customers a version of its Windows desktop operating system without its Media Player — intended to give people a free choice of media software — has been a spectacular failure, he said.

In its core market, no computer maker had shipped a PC or laptop with the media-free Windows XP N version. “Not a single one,” Bellis told the 13 judges. Some 90 percent of Windows sales come from being pre-installed on computers when they are sold.

XP N sales represent 0.005 percent of overall XP sales in Europe, Microsoft told the court, and many of the ones produced may remain unsold, it said.

French retailer FNAC, the single largest retailer to order XP N with 46 percent of the orders, has said that it sees no consumer demand for the product, Microsoft said.

“The failure to offer a product that nobody wants cannot be an abuse,” Bellis said.

But Commission lawyer Per Hellstrom said Microsoft’s arguments were irrelevant because consumers did not have real freedom of choice over the media software they are offered.

“Microsoft’s pleas must be ignored,” he told the court. “This is the world according to Microsoft where it decides what is best for consumers.”

He said the company effectively controls the market because seven out of ten computers sold in Europe ship with Media Player. Developers see these figures and make content for the player, a situation that squeezes rivals even further, he said.