Microsoft Shares a Little More

UPDATED: Microsoft said it has moved closer to meeting the European
Commission’s demands for more flexible licensing terms for computer code.
This would help rivals write software that interoperates with Microsoft

In a letter to the commission last week, the Redmond, Wash., software giant
agreed to 20 of 26 demands to open up pockets of technology it controls in
Europe, a company spokesperson confirmed Tuesday.

Microsoft is lowering licensing fees and making it easier for potential
licensees to review software to determine if they want to purchase it.

The software maker is also addressing the commission’s concern about the
so-called “all-in-one license,” in which customers must pay for applications
or features they don’t need.

To address this concern, the spokesperson said Microsoft is open to offering
customized licenses that will give licensees the technologies they want
without giving them the technologies they don’t feel they need.

Microsoft’s concessions may make it easier for rivals such as RealNetworks
or Apple to do business. But several issues surrounding rights for open
source software purveyors still need to be addressed, according to both the
commission and Microsoft.

Microsoft is requiring as much as $600 in royalties for each server on which
a rival company’s software ran, a prospect that won’t work for open sourcers
whose core ideals are allowing software to be altered or copied.
In general, open source entities prefer a one-time charge to make sharing
and copying possible.

“We have proposed a new, lower-cost royalty structure in an effort to
address the commission’s concerns,” the spokesperson said.

While Microsoft has said it will make it less expensive for rivals to peek
at its computer codes to decide if they want to license them, the commission
contends that open source vendors are excluded.

The Microsoft spokesperson said these issues revolve around finding a way to
strike a balance on protecting IP rights and making these technologies more
broadly available.

“We believe we have come up with a way so that companies can implement these
technologies in code that would get distributed with open source products,
but the source code wouldn’t be published itself so that the confidentiality
of our information is preserved,” the spokesperson said.

Commission spokesman Jonathan Todd confirmed the regulators received the
letter but refused to characterize the document or specify what demands
Microsoft agreed to meet.

“We are in the process of analyzing the letter but we are not confirming
that Microsoft has met our concerns,” Todd said.

Last week, Microsoft agreed
to a number of changes requested by the commission relating to the design of
its version of Windows without Media Player.

The changes stem from the European Commission’s ruling in March 2004 that
Microsoft had abused its monopoly position, and ordered the company to
unbundled its Windows Media Player software from Windows in European

The commission levied a
record fine of $613 million last March and imposed other penalties against
Microsoft. The software giant is facing possible fines of up to $5 million a
day until they fully comply with the rulings.

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