Microsoft replies to EC charges

Microsoft has officially responded to charges by the European Commission (EC) that its licensing practices stifle competition, with a private filing that it hopes will avert a prolonged investigation. Microsoft, which says that its competitive position has already been weakened by the EC charges, would prefer not to divulge trade secrets to press its case. But a company spokesperson said this weekend that the EC could prevent Microsoft from innovating and harm competition in the long run if it succeeds, and that subsequent inquiries would require it to hand over business secrets.

"Microsoft has replied," said an EC spokesperson this weekend. "Now the commission will have to examine the pile of documents it has received in order to come to a conclusion as to whether the company violated the law." Microsoft supplied the EC with a stack of statements and studies that it hopes will bolster its case. The European case was prompted by complaints by Sun Microsystems, which said that Microsoft's desktop monopoly made it important for the company to be more closely regulated in the server space. Sun would like access to Microsoft's server APIs, so that it can more easily create compatible software, hardware, and services. But Microsoft argues that the law in Europe is clear about compatibility and competition. The company says that Sun is welcome to reverse engineer its server products if the published APIs aren't enough.

According to the latest IDC study, Microsoft controls almost 37 percent of the worldwide server market, while Linux has 23 percent and other versions of Unix have 15.1 percent. This contrasts sharply with the desktop market, where Microsoft's Windows and Office products each control over 90 percent of their respective markets

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