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By | Christopher Williams 22nd October 2007 15:00

Microsoft will not appeal EU monopoly fine

Towel thrown in

Microsoft has finally blinked in its three-year stare-out contest with the European Commission. Today the firm said it would not launch another appeal against the landmark €497m anti-trust fine slapped on it in 2004.

The vanquished vendor will not attempt to overturn the European Court of First Instance's September verdict. It'll now have to open up access to APIs to let other developers, including open sourcers, interoperate with Windows servers.

In a press conference in Brussels today, European Competition Commissioner "Steely" Neelie Kroes said: "I have been in almost daily contact with Steve Ballmer over the last two or three weeks. As a result of final contacts that took place early this morning, I am now in a position to present to you the results of those highly constructive conversations.

"I told Microsoft that its royalty rates were too high for the patents they claim are applicable to the interoperability information."

As a result, Microsoft has abandoned its attempts to charge an ongoing percentage royalty to third parties for licensing interoperability information. It'll now levy a one-off charge of €10,000. The royalty on related patents will also be slashed from 5.95 per cent to 0.4 per cent.

Microsoft sent us this reaction:

At the time the Court of First Instance (CFI) issued its judgment in September, Microsoft committed to taking any further steps necessary to achieve full compliance with the commission's decision. We have undertaken a constructive discussion with the commission and have now agreed on those additional steps.

We will not appeal the CFI's decision to the European Court of Justice and will continue to work closely with the commission and the industry to ensure a flourishing and competitive environment for information technology in Europe and around the world.

Kroes predicted that the agreement would profoundly affect the software industry for years to come. "The measures that the commission has insisted upon will benefit computer users by bringing competition and innovation back to the server market."

Kroes finished her speech with a warning: "[This] sets a precedent with regard to Microsoft's future market behaviour in this and other areas. Microsoft must bear this in mind."

Her full speech is here. ®

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