2. Summary
In the year 2004, the European Union Commission charged Microsoft a hefty fine amounting to 605 Million
Dollars, The European Commission put forward two Charges against them, Firstly for Not Sharing Certain
Information to a rival firm Sun Microsystems. Second for giving Windows Media Player with the Windows
Operating System. This led to the destruction of Competition among the Firms, the EC stated that Microsoft
was giving the rival firms a Unfair Disadvantage. Hence Microsoft was ordered by the EC, to reveal the
necessary information within 120 days and 90 days to Offer a version of the OS without a Media Player.
3. Q.1.) What were the consequences of the EC’s decision to punish Microsoft ? Who did the EC want to Protect.
A.1.) The European Commission charged Microsoft on the basis of Two Offences :-
I. Microsoft did not share some critical information to Sun Microsystems.
II. Microsoft bundled Windows Media Player along with the Windows O.S.
• Hence the E.C fined Microsoft with a Hefty Fine of 605 Million Dollars.
• The E.C also gave Microsoft 120 days to share the required information with the competitor.
• Microsoft was also given 90 days to provide a Version of the O.S without the Media Player.
• The E.C was protecting other IT Firms like Sun Microsystems.
4. Q.2.) Do some research to update the Microsoft case at the time of reading. What is there in different Historic,
Political, Legal and Business Practices background that give rise to this situation ? Are there differences in the
approach to Globalization ?
A.2.)
5. Q.3.) Have there been similar rulings by the EC about other MNCs since the time of this report?
A.3.)
• The European Commission has fined Facebook Inc. 110 million Euros for providing incorrect information
during the Commission's 2014 investigation under the EU Merger Regulation of Facebook's acquisition of
WhatsApp.
• The changes included linking WhatsApp users’ phone numbers with Facebook users’ identities.
• The fine would amount up to 1% of the Annual Turn Over.
• It was done under the EU Merger Regulation (Regulation No 139/2004).
6. Q.4.) What are the implications and potential fallout of the EC’s decision for strategic planning of other
companies around the world?
A.4.)
• The European Commission was looking at formulating a law that would have an impact on the Intellectual
Property Rights and the ability of Firms to Innovate.
• This decision would fallout because firms take the initiative to perform R&D for the various products or
services, and this same information for different aspects of Business Development, was supposed to be
shared with Rival Competitors.
7. Q.5.) Does this mean that companies can now be governed in every way by any of the countries or regions in which they do
business, or is there hope of future “globalization” of regulations such as these?
A.5.)
• In todays environment of business, companies are given the freedom to work on the R&D for different
products and services, although companies have to stay in compliance with the Local Business
Environment while producing.
• Companies are given Patents, Trademarks, Copyrights in order to Protect their Development Projects.
• Hence in my opinion with reference to this case, today with the Emergence of Globalization, companies
are setting up their units in more than 1 Country, in order to represent the entire World as a Large Market
or an Economic System as a Whole.
