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MS loses Europe appeal, will ship WMP-free Windows version

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Microsoft is to start shipping a cut-down version of Windows in Europe from January, following the failure of its appeal to the European Court of First Instance over penalties imposed by the Commission earlier this year. Microsoft hasn't run out of appeal routes, but the Court ordered the company to begin carrying out the Commission's decision immediately.

This, according to Microsoft general counsel Brad Smith, means OEMs will get the version of Windows without Media Player next month, with it being available to other customers from February. It's not yet clear precisely what Microsoft's implementation of the decision will entail, but the notion of Windows Media Player being illegal music software in Europe is one to conjure with. Microsoft hasn't been massively concerned about the Commission's fine of €497 million, but it sees - understandably - the Commission's attempt to limit what it can and cannot put into Windows as a direct threat to its business model. As the Commission's intent is to do something about the operation of that business model, that too is understandable.

It requires Microsoft to unbundle Media Player and to disclose "interface documentation" sufficient to allow non-Microsoft workgroup servers to achieve full interoperability with Windows PCs and servers to rival vendors. The peace treaty with Sun, which was one of these rivals, earlier this year may ease the operation of this somewhat, but not entirely.

Microsoft can appeal the decision to the European Court of Justice, but this could take several months. In a statement, the company said it was reviewing the Court's order, but claimed to be "encouraged by a number of aspect's of the Court's discussion of the merits of the case." The Court didn't find, as Microsoft claimed, that implementation of the remedies would impose "irreparable harm" on the company, but "recognized that some of our arguments on the merits of the case are well-founded and may ultimately carry the day when the substantive issues are resolved in the full appeal."

This, it said, left Microsoft hopeful that the issues highlighted by the Court "will create an opportunity for the parties to discuss settlement." Which you might reckon is a seriously optimistic spin of the verdict - if Microsoft's appeal had been accepted, then the Commission might have felt more pressure to cut a deal that was more favourable to the company. The pressure however is now on Microsoft, which might still make a deal more likely, but only by making Microsoft more likely to concede points. ®

Related links:

European court to rule on MS sanctions
Novell, CCIA evidence may be tossed out in MS EC case
MS gets EU fine, orders for server info and WMP-free Windows

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