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By | John Oates 20th January 2009 10:12

IBM faces EU monopoly probe

Accused of mainframe monopoly

IBM is likely to face a full European Union investigation into its mainframe business as a rival firm formally complains to the Competition Commission.

t3 Technologies alleges IBM abused its dominant market position by tying sales of its operating system to sales of its hardware. The company, which dubs itself "the other mainframe company", makes rack servers aimed at small and medium-sized data centres as well as mainframes.

The European Commission has been investigating IBM for since October 2007 following a complaint by Platform Solutions (PSI). IBM bought PSI but the EU investigation continued.

t3 was meant to have filed a complaint with the Commission last year* see below. It is also alleging that IBM withheld patent information and other intellectual property needed by rival firms to allow proper interoperability with Big Blue's products.

The complaint is being backed by the Computer & Communications Industry Association.

CCIA president Ed Black said: “This filing is so indicative of the competition enforcement vacuum we have had, in that on the very last day of the Bush administration yet another company had to go file an antitrust case overseas because US antitrust authorities have been unreliable for the past eight years.”

Steven Friedman, president of t3, said: "We did not file a formal complaint but did meet with the Commission in the middle of last year - we came away from that meeting with a strong sense of what we needed to prove. We have now given them 500 pages of very comprehensive and compelling evidence which we are confident will lead to a formal investigation."

t3 Technologies was founded in 1992 and claims almost 1,000 customers in 28 countries. It has headquarters in Tampa, Florida as well as offices in Birmingham in the UK, Hamburg in Germany and Milan in Italy.

t3 has hired lawyers Berwin Leighton Paisner. ®

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