The European Union has fined Microsoft €561 million (£485 million) for breaking a legal pledge to offer PC users a choice of Internet browsers to use with its Windows OS.
Back in 2009, Microsoft signed a legal deal with the European Commission to ensure that PC owners would have a choice of Internet browsers, such as Google Chrome or Mozilla Firefox, rather than the default Microsoft Internet Explorer.
However, after an investigation was held, it was found that Microsoft had in fact broken that commitment, failing to offer 15 million users between May 2011 and July 2012 a choice of internet browsers when installing the new Windows 7 service pack 1.
The hefty fine will mark the first time the European Commission has punished a company for failing to meet its legal obligations. Although, Microsoft’s fine represents approximately 1 per cent of its 2012 fiscal-year revenue, the company could have been charged up to 10 per cent of its global revenue by the European Union’s executive body. When calculating the fine, it was taken into account that Microsoft had fully cooperated with the investigation, providing all necessary information.
Joaquin Almunia, Competition Commissioner for the EU said the fine is meant to make an example of Microsoft, in an attempt to deter other technology companies from making similar mistakes.
“”If companies agree to offer commitments which then become legally binding, they must do what they have committed to do or face the consequences,” said Almunia. “I hope this decision will make companies think twice before they even think of intentionally breaching their obligation or even of neglecting their duty to ensure strict compliance.”
Microsoft is taking full responsibility for the breach, blaming the incident on a technical error, and apologised in a statement.
“We have apologized for it. 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,” the software giant said.
Almunia has also said it was “naïve” to allow Microsoft to monitor its own compliance with the agreement, adding that the same policy would not be repeated in the future.
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