The European Union fined Microsoft Inc. $732.2 million Wednesday for failing to provide its millions of users with an option to choose a web browser other than its Microsoft Internet Explorer browser, reports The Wall Street Journal.
The European Union's decision to charge Microsoft Inc, world's largest software company, is based upon the promise made by Microsoft in 2009 to guarantee that customers will get an option to choose how they access the Internet in addition to the default Internet Explorer. It is the first time that the European Union's anti-trust authority has fined a company for not meeting its obligations. Charging Microsoft Inc. will act as an example for other companies involved in EU antitrust disputes to stand by their obligations.
"Such a breach is, of course, very serious, irrespective of whether it was intentional or not, and it calls for a sanction," EU competition Chief Joaquín Almunia said in a prepared statement. "I hope this decision will make companies think twice before they even think of intentionally breaching their obligations or even of neglecting their duty to ensure strict compliance."
As per Microsoft's obligations, it was supposed to provide all users with a "choice screen" till 2014, where users could choose any browser. Later the option of choosing the browser was removed in February 2011 and lasted till July 2012. This was notified to the regulators by a third party and Microsoft Inc. took "full responsibility" for the cause, explaining it to be a "technical" glitch.
The commission also noted that during the period users were given the "choice screen," Internet Explorer's market shares dropped below 30 percent from 50 percent.
Then European Union carried out a compliance check which shed light on the issue, which should have been checked by Microsoft earlier.
As an impact, Microsoft shares fell by 0.92 percent.
"If companies agree to offer commitments which then become legally binding, they must do what they have committed to do or face the consequences," Almunia said in a news conference.
Microsoft apologized for the error and promised to be more careful in the future to avoid any such mistake.
"We provided the Commission with a complete and candid assessment of the situation, and we have taken steps to strengthen our software development and other processes to help avoid this mistake - or anything similar - in the future," Microsoft said in a statement.
