The European Union (UN)'s European Commission (EC) has opened yet another probe into Microsoft's business practices. The agency is investigating whether the software giant is attempting to dominate the emerging market for content-rights management. Microsoft and Time Warner plan to acquire a majority stake in ContentGuard Holdings, a company that develops digital protection against content piracy. Microsoft already licenses ContentGuard Holdings technology for use in its Digital Rights Management (DRM) software.
"After a preliminary review, it appears to the commission that the transaction might possibly create or strengthen a dominant position by Microsoft in the market for DRM solutions," the EC said in a statement this week. "Under Microsoft's and Time Warner's joint ownership, ContentGuard may have both the incentives and the ability to use its \[intellectual property rights\] portfolio to put Microsoft's rivals in the DRM solutions market at a competitive disadvantage \[and\] could also slow the development of open-interoperability standards."
The agency is investigating whether Microsoft and Time Warner will effectively dominate the emerging rights-management market, thereby killing competition. EC regulators will try to determine which option is better for consumers: a single, dominant rights-management solution or an open-standards-based technology that numerous providers use. US regulatory agencies haven't expressed any interest in mounting a similar investigation.
The EC investigation is expected to last 3 or 4 months. Microsoft and Time Warner have pledged to "fully cooperate" with the investigation. "We understand that this is a complex area," a Microsoft spokesperson said.