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July 13, 2006

Vista unaffected by EU meddling?

Posted by David Hunter at 10:01 AM ET.

The elephant in the living room in the Microsoft dust up with the European Union is what the effect will be on the release of Windows Vista. As I mentioned yesterday, it is quite clear that there is active negotiation between the two parties generated at least in part by complaints from Microsoft competitors and Competition Commissioner Neelie Kroes was even taking credit for Vista schedule slips. To date there hasn’t been much of a concrete nature from Microsoft other than top lawyer Brad Smith’s “we offered them four alternatives but haven’t heard back,” but yesterday the head of Microsoft’s Japanese unit weighed in:

A European fine on Microsoft Corp. will have no effect on the launch of Vista, its next-generation Windows operating system, the U.S. software giant’s Japan unit said on Thursday.

“I don’t think this has any impact on the teams and the efforts that are going forward to that launch,” Microsoft Co. Ltd. President Darren Huston told a news conference.

“We are still committed to the existing plan of record.”

It would be unseemly of me to suggest that Mr. Huston hadn’t gotten the memo from HQ, but this seems to me to fit under the category of “off hand comment at news conference” given all the other evidence.

The key aspect here is not that antitrust regulators (or regulators of any other kind) might weigh in on some aspect of Microsoft’s shipping products because, after all, that’s what their job is. Instead it’s that the regulators are apparently getting involved before the product is even out the door. I guess we should just think of Neelie Kroes as part of the Vista design team.

Update: Paul Meller and Steve Lohr in the NY Times:

In letters to the company this year, the European authorities have also raised concerns and asked questions about Windows Vista, the next version of the operating system, focusing on Microsoft’s plans to build in new Internet search features, security software and document formats.

The most recent letter from the commission came on July 4, requesting answers to an additional 79 questions, Bradford L. Smith, Microsoft’s general counsel, said in an interview on Wednesday.

Microsoft now anticipates regulatory reviews as just another step in its development of Windows, the dominant PC operating system. In the United States, Mr. Smith noted, Microsoft has heard repeatedly from the independent technical committee set up to monitor the company, as part of the settlement of the long-running federal antitrust suit against Microsoft.

The American regulatory review, Mr. Smith said, is nearly over. “In Europe, we don’t have guidance that is anywhere near as concrete as in the United States,” Mr. Smith said. “My worry is that we won’t have clarity from the European regulators until it is too late, until just before Vista is scheduled to ship and we won’t be able to make changes.

Filed under Antitrust, General Business, Governmental Relations, Legal, Microsoft, OS - Client, Windows Vista

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