EU Rules Against Innovation in Microsoft Case

Contacts:     <?xml:namespace prefix = o ns = “urn:schemas-microsoft-com:office:office” />

Richard Morrison, 202.331.2273

Clyde <?xml:namespace prefix = st1 ns = “urn:schemas-microsoft-com:office:smarttags” />Wayne Crews, Jr., 202.215.4298


Washington, D.C., December 22, 2004 – Yesterday’s antitrust ruling against Microsoft by a European Union court sends a troubling message about the future of competition and innovation in Europe and around the world. The penalties imposed on the company threaten to chill investment in new technologies and impose billion of dollars of costs on European consumers and independent software developers.


In addition to a fine of $665 million, Microsoft will be forced to separate its Windows Media Player from its operating system and disclose parts of its internal software code for server applications to other companies. While these changes in the company’s software and intellectual property protections will impose huge costs on the IT industry and its customers, the alleged benefits of the ruling is far from clear.


“Much like their U.S. counterparts, European antitrust officials have done a remarkably poor job of providing tangible evidence of any harm to competitors that couldn’t be more reasonably ascribed to the legitimate success of popular products and a smart business model,” said Clyde Wayne Crews, Jr., Director of Technology Policy at the Competitive Enterprise Institute. “In the case of consumers, the case is even weaker and the damage more worrying. In the end, it’s consumers rather any particular company that will suffer most when innovation and creativity become liabilities in the marketplace.”




Clyde Wayne Crews, Jr.

Director of Technology Policy


[email protected]


Braden Cox

Technology Counsel


[email protected]