Microsoft gracefully accepted full responsibility after the European Union's competition watchdog, called the Commission, decided to fine the Redmond, Wash. giant for going back on a pledge that the company would allow users to choose which default browser they wanted installed on new Windows PCs. The fine will cost Microsoft $733 million and the company will most likely not appeal the decision.
Back in 2009, Microsoft paid $1.118 billion in a settlement over its abuse of Windows' dominance, which took place over more than a decade. That was when the tech giant promised to offer clients the option of having Internet Explorer as their default browser. But over the next few years, from when Windows 7 went live in Europe in May 2011 through July 2012, Microsoft did not comply with the pledge on over 15 million installations of Windows 7.
The most recent fine reflects the scale and magnitude of the violation, as well as the length of time that Microsoft was able to fly under the Commission's radar. According to regulation, it could have been worse: Microsoft could theoretically have been forced to shell out 10 percent of its global revenue during the period from May 2011 through June 2012. The fine is "far in excess of any benefit Microsoft could have gotten from the error, and vastly in excess of any harm to EU consumers, who are all aware of alternatives to Internet Explorer," Keith Hylton, a law and antitrust specialist at Boston Univeristy told the Washington Post.
But as a warning to other software corporations, it may prove effective — although Microsoft is the first corporation to ever backslide on a pledge to the Commission, as it said in its press release. “We take full responsibility for the technical error that caused this problem and have apologized for it,” Microsoft announced in a statement. It is required to offer consumers multiple options for browsers through 2014.
The Commission's top competition regulator, Joaquin Almunia, said at a press conference that the Commission was "naive" in allowing Microsoft to police itself, and it would not make the same mistake again.