Microsoft ends 'unfair' contract

[Henk Elegeert]

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Microsoft ends 'unfair' contract
Microsoft has announced it is to ditch a controversial
contracts provision under investigation in Japan.

The software giant's statement comes after Japanese fair
trade officials raided its Tokyo offices on suspicion of
violating anti-monopoly laws.

Microsoft said it would now be removing the contract detail
which prevents computer firms from suing it for any use of
their patented technology.

The Japanese Fair Trade Commission had said it was unfair
and restrictive.

Microsoft is accused of making companies such as NEC,
Hitachi and Sony, who want to pre-install its Windows
software on their computers, sign away their right to sue,
even if they find Microsoft has used their patent technology.

Continuing denial

In its statement Microsoft again denied any wrongdoing, but
said it would be removing the contract provision for
"customer satisfaction" reasons.

        Unless Japanese companies agree to the (non-suing) clause,
they cannot pre-install Windows in their computers
Japanese Fair Trade Commission spokesman

"Microsoft believes that the patent-related provision is
lawful under Japanese, US and EU law," it said.

Microsoft spokesman Jim Desler said it had been intended to
reduce litigation and was "narrow in scope".

The software giant also said the patent-related provision
had been approved by European Union regulators and reviewed
by anti-trust authorities in the US.

The Japanese watchdog said Microsoft was suspected of
setting unfair conditions when giving licenses for Windows
to Japanese computer makers.

Latest case

[  "Unless Japanese companies agree to the clause, they
cannot pre-install Windows in their computers," he said.  ]

It is not the first time the US software giant has been
accused of abusing its monopoly on PC operating systems to
push prices higher or harm rivals.

It faced allegations of unfair trading in 1998, in Japan,
and it is in settlement negotiations with the European
Commission, which has accused it of trying to stifle
competition for multimedia players, by tying its Media
Player programme to its Windows operating system.

RealNetworks is suing Microsoft over the same issue,
accusing it of unfairly monopolising the growing market for
digital music and video.

Microsoft has denied such allegations, insisting the market
is competitive.

The company last year said it had settled 10 consumer class
action suits in a number of US states at a total cost of
$1.6bn. The legal cases accused Microsoft of using its
dominant position in the market to overcharge for its software.

Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/1/hi/business/3488186.stm

Published: 2004/02/27 06:47:02 GMT

© BBC MMIV

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