EU lukewarm on latest Microsoft proposals

Microsoft has unveiled what its says are "a set of broad-reaching changes" to its business and technology practices, in a response…

Microsoft has unveiled what its says are "a set of broad-reaching changes" to its business and technology practices, in a response to ongoing pressure from the European Commission to make its products work with those of its competitors.

Yesterday's announcement covers Microsoft's "high volume" products including Windows, which runs 95 per cent of the world's PCs, the ubiquitous Office suite and the Exchange e-mail server.

Microsoft has committed to freely publishing information on how third parties can interact with these products and given a commitment not to sue open source developers who include the information in their products. Access to the information previously required payment of royalties.

Microsoft general counsel Brad Smith said the company was "committed to providing full information to the European Commission so it can evaluate all of these steps".

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Microsoft chief executive Steve Ballmer said the move was not a response to regulators but did reflect the company's "unique legal situation".

In 2004 Microsoft was fined a record €497 million by the commission for what it saw as anti-competitive actions. In 2006 it was fined an additional €280.5 million for non-compliance with the original decision.

Last October Microsoft and the EC agreed a deal which saw it make available information for making other software operate with the Windows operating system at a much lower price than it initially sought.

Yesterday's announcement by Microsoft goes much further but it still drew a lukewarm response from Brussels.

The commission said the allegations that Microsoft had illegally "tied" the internet Explorer browser to Windows, which forms part of an ongoing probe, had still not been addressed.

"The commission would welcome any move towards genuine interoperability," it said in a statement.

"Nonetheless, the commission notes that today's announcement follows at least four similar statements by Microsoft in the past on the importance of interoperability."

As well as hoping to appease regulators the move will send a clear message to critics of Microsoft's $44.6 billion bid to acquire Yahoo. Google, whose dominance of the online advertising market Microsoft is targeting with the bid, said Microsoft's bid "raises troubling questions". Google's chief legal officer David Drummond asked if Microsoft would "attempt to exert the same sort of inappropriate and illegal influence over the internet that it did with the PC?"

Yesterday executives said Microsoft would seek to provide open connections from its products, promote data portability, increase its support for industry standards and engage more openly with its customers and the rest of the industry, including open source developers.