This morning's ruling from the European Court of First Instance dissects both Microsoft's and the European Commission's arguments with logical, plain-spoken precision. It makes the point that Microsoft doesn't get to decide what "interoperability," "bundling," and "evolution" mean. But neither does the EC.

As an institution unto itself, the European Union is frankly not much older than Microsoft. America has a few hundred years of legal precedent to guide it, and the EU characterizes its heritage as the combination of thousands of years of legal foundation among its 27 member countries. But in actuality, the European Commission is bound by its own principles not to apply itself to any case, even if it affects the whole of the continent, unless it can prove to its people that it can do a better job than the legislative authorities of its member states can do collectively.

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The European Court of First Instance in Luxembourg has ruled against Microsoft in its appeal of a March 2004 finding of the European Commission. In so doing, the Court upholds the EC's finding that Microsoft abused its dominant market position in Europe, first by failing to supply access to its protocols for enabling interoperability with its communications software in Windows and Windows Server, and second by bundling its Media Player with Windows XP.

"The Court considers that the Commission was correct to conclude that the work group server operating systems of Microsoft's competitors must be able to interoperate with Windows domain architecture on an equal footing with Windows operating systems if they are to be capable of being marketed viably," reads a press release issued by the Luxembourg court this morning. "The absence of such interoperability has the effect of reinforcing Microsoft's competitive position on the market and creates a risk that competition will be eliminated."

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After the close of business Friday, the SCO Group -- which was recently found not to own the UNIX trademark after all -- announced it would be filing for Chapter 11 bankruptcy protection.

In a prepared statement, SCO President and CEO Darl McBride said, "We want to assure our customers and partners that they can continue to rely on SCO products, support and services for their business critical operations. Chapter 11 reorganization provides the Company with an opportunity to protect its assets during this time while focusing on building our future plans."

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In a public show of disappointment, National Association of Broadcasters President and CEO David Rehr wrote an open letter to SoundExchange Executive Director John Simson last Monday, indicating that SoundExchange had rejected its compromise royalties offer for radio stations with Internet streaming operations.

The rejection comes over three months after the NAB made its offer, which it claimed would enable the performance rights organization to meet its revenue goals while at the same time charging stations a more moderate amount.

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When Verizon Wireless filed an almost perfunctorily brief lawsuit against the FCC in a federal appeals court on Monday, analysts and wireless industry observers were baffled. With the FCC having written up the 700 MHz spectrum auction order in late July, didn't the company have enough time to complain then? Surprisingly, a clue to its motives comes not from itself or its lawsuit but from the FCC.

When Google first indicated it would be willing to bid as much as $4.6 billion for prime real estate in the 700 MHz band presently belonging to UHF channels, if the US Federal Communications Commission would impose stipulations on how the winning bidder would use that spectrum, Verizon Wireless was one of several prospective bidders expressing outrage. A battle was expected in front of commissioners, and then suddenly the objections subsided.

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A Microsoft program manager found himself conducting a tricky bit of PR yesterday, providing for his team's blog a lengthy explanation of a documented feature in Windows that independent researchers discovered only this week: the ability for the Windows Update service to update itself, even when the user's setting for Automatic Updates is "off." Researchers had charged the company with updating software on users' systems without their consent.

"Windows Update is a service that primarily delivers updates to Windows," the Update service's program manager Nate Clinton wrote yesterday. "To ensure on-going service reliability and operation, we must also update and enhance the Windows Update service itself, including its client side software. These upgrades are important if we are to maintain the quality of the service."

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In a statement to BetaNews this afternoon, a Toshiba spokesperson said that only a preliminary version of Toshiba's 51 GB three-layer, single-sided HD DVD format had been approved by the DVD Forum, caretaker of HD DVD.

As it turned out, and as Toshiba's spokespersons may have only just now realized, the DVD Forum signed off on a preliminary specification, which may have been confused for the final specification because its version number is 1.9.

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As Sony made official yesterday, the company plans to release four new Blu-ray Disc recorders in Japan on November 8, all of which will be capable of recording to dual-layer (50 GB) BD-R and BD-RE (erasable, re-recordable) discs. But a statement by the company's vice president for consumer electronics, Katsumi Ihara, was mistaken by US press sources in its translation to English as saying that the company plans to drop support for red-laser DVD-R recording, in all recordable consoles sold in Japan after November.

The Japanese Agencies press service translated Ihara's statement as follows: "We plan to make all our recorders in the domestic market Blu-ray compatible in future, allowing consumers to record high-definition programs over a longer period." Asian news sources interpreted the statement to mean that after November, Sony's recordable consoles will no longer be DVD-R only.

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A London security analyst working with the open source group GNUCitizen has discovered a potentially serious exploit that could affect users of the Firefox browser and Apple's QuickTime movie and music player - especially iTunes customers - on Windows XP-based machines. BetaNews tested and verified the severity of the exploit.

As early as one year ago, as Petko D. Petkov wrote yesterday, he discovered that JavaScript code appearing in the <EMBED> tag of an HTML file could launch a new Web browser instance, feeding it any kind of default code that isn't checked before being executed.

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In a Knowledgebase advisory to developers today, Microsoft is urging developers for Windows Vista who intend for their programs to run under Service Pack 1 not to assume the default search protocol being used by the system is Microsoft's. This after over a year in which Microsoft spokespersons have maintained, under a rain of criticism from search competitor Google, that Vista's and Internet Explorer 7's search facilities were already manufacturer-agnostic.

"If you develop an application that is meant to use or meant to build upon a specific desktop search application, you should not depend only on the search protocol," reads KB941946, released today. "Because many applications may own the search protocol, you cannot guarantee that the targeted desktop search application owns the search protocol at any time. Instead, use a private search protocol that is defined by the targeted desktop search application."

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Yesterday, Microsoft and Novell announced they were moving in together - at least insofar as their joint development work was concerned, into a modest 2,500 square-foot laboratory in Cambridge, Mass. "The first priority for the lab team will be to ensure interoperability between Microsoft and Novell virtualization technologies," reads yesterday's statement from Microsoft.

Then comes today, with Microsoft making nice with its friends at Sun Microsystems. They too will open up an interop laboratory...or so they said during a press conference this afternoon. However, reporters who were already familiar with the Novell development yesterday wondered, where will this Sun lab be located? Will it be in Cambridge? Will it be bigger or smaller? And perhaps most importantly, why isn't there just one lab?

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Sun Microsystems has become the latest server manufacturer to offer Windows Server operating systems pre-installed on x64 servers, as well as what Sun's EVP John Fowler described this afternoon, during a press conference call, as "the entirety of our server product line."

Solaris will be able to work in a Microsoft virtualized environment, and Windows will be able to work under a virtual machine hosted by Solaris, under a collaboration agreement announced today. Fowler said 100% of Solaris' customers also run Windows someplace in their data centers, so this agreement was vitally necessary.

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The patent holding company that successfully produced a $612.5 million patent infringement settlement with BlackBerry producer Research In Motion even while the US Patent and Trademark Office was doubting the validity of its patents, has filed suit against the US' four leading wireless carriers for infringement of what are believed to include some of the same disputed patents.

As first reported this morning by The Wall Street Journal, NTP Inc.'s contention is that the four wireless carriers - AT&T Wireless, Verizon Wireless, T-Mobile, and Sprint Nextel - are selling e-mail services to customers that utilize "push" technologies whose basic concepts are protected by patent. During the famous 2005 lawsuit between NTP and RIM, the USPTO declared two of the five disputed patents invalid, and was actively considering the other three.

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For more: Windows Server OS to be Offered on Sun Servers

This afternoon Eastern time, two representatives from Sun Microsystems and Microsoft will be holding a joint press conference, to discuss what is only being described, for now, as "an expanded agreement between the two companies."

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The South Korean business daily Maeil has confirmed that the country's Fair Trade Commission has not only concluded its antitrust investigation against Intel, but has filed a statement of objections against the CPU maker. This after some US press sources had taken the headline of Korea's story, "Korea Closes Intel Investigation," too literally.

The bad news portion of Korea's FTC disclosures came first from Bloomberg News late this morning, then the San Jose Mercury News soon thereafter. The investigation period has indeed closed, and the charges and possible penalty phase has immediately begun.

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