Microsoft Submits Final EU Proposal

Just before a midnight deadline, Microsoft submitted its final proposal to the European Commission regarding its plan to comply with antitrust remedies imposed in March 2004. If the proposal does not appease EU regulators, which have grown increasingly tired of Microsoft's delays, the company could face daily fines of up to $5 million.

Last year, the EU fined Microsoft 497 million euro for anticompetitive practices, and demanded a version of Windows XP be released without its bundled media player. Microsoft paid the fine and has created a stripped down version of XP labeled with the letter "N." The Commission made 26 demands in total, of which 20 were agreed to by Microsoft.

A continued sticking point, however, is a demand that Microsoft license the source code to its Windows Server software in order to allow better interoperability between different platforms. Microsoft began charging for the code and denied access to open source projects - a move the EU was not happy with.

In April, a Microsoft spokesperson told BetaNews, "We are working with the Commission to try to find a way that companies can implement these technologies in code that would get distributed with open source products, but the source code wouldn't be published itself so that the confidentiality of our information is preserved."

The Commission was also upset with how Microsoft handled the removal of Windows Media Player from XP. Regulators feel Microsoft made the special edition unappealing to OEMs by not lowering the price, essentially killing any demand. Microsoft competitors have also claimed the WMP-free release does not work properly with their audio and video software.

Now, the EU Commission says it will sift through the new proposal, and determine if Microsoft has complied with the ruling against it. Under EU policies, it has the right to fine Microsoft up to five percent of its daily sales if it deems the company is not following orders.

"We will analyse very carefully what is on the table to assess whether or not Microsoft has complied with the March 2004 decision," EU spokesperson Jonathan Todd told BetaNews. "We cannot say at this stage how long this will take. We cannot comment on the content."

It is expected to take the Commission weeks to reach a conclusion on the final proposal from Microsoft. Officials previously said they hoped to respond by the end of July.

In a statement, a Microsoft spokesperson said, "We can confirm that the proposals did go into the commission last night prior to the deadline and we await the Commission's response."