Microsoft faces substantial EC fine over browser rules breach

Microsoft may face a huge fine for failing to offer millions of Windows users a choice of web browser, despite apologising to the European Commission (EC).

A 2009 EU antitrust settlement required Microsoft to offer PC owners the opportunity to choose software from rivals such as Google and Mozilla as their main web browser.

Microsoft was forced to offer a choice of browser after a 10-year battle with EC competition regulators, who accused it of abusing its dominance of the operating system (OS) market to damage rivals.

But Microsoft has admitted it failed to provide a choice of browsers after the release of the first major update to Windows 7 OS, due to a technical error built into the update.

The EC's competition commissioner Joaquin Almunia said that, since February 2011, Microsoft had failed to provide users with a choice of browsers.

That means that around 28 million Windows 7 OS users might not have seen the browser choice screen that should have been displayed when a Windows user in Europe first used their PC.

Almunia warned of severe consequences if a breach of the rules is confirmed by a formal investigation, but noted that Microsoft seemed to acknowledge the facts.

"Needless to say, we take compliance with our decision very seriously," he said. "If the infringement is confirmed, there will be sanctions."

In 2004, the EC was successful in its monopoly abuse case against Microsoft for linking its media player to Windows, fining the software maker €497m (£430m).

Microsoft said it had discovered the technical error after the EC had alerted the software maker to reports that the browser choice screen (BCS) was not being displayed on some PCs.

“The BCS software has been delivered as it should have been to PCs running the original version of Windows 7, as well as the relevant versions of Windows XP and Windows Vista," said Microsoft.

“However, while we believed when we filed our most recent compliance report in December 2011 that we were distributing the BCS software to all relevant PCs as required, we learned recently that we’ve missed serving the BCS software to the roughly 28 million PCs running Windows 7 SP1.”

Microsoft apologised for the error, saying it deeply regretted the oversight, and that it had fallen short in its responsibility, according to the Guardian.

Microsoft blamed the fault on its engineers, who had not realised they needed to keep Windows PCs in compliance with the EC's December 2009 ruling, the paper said.

Microsoft said that it began distributing a software fix for the error within two business days of discovering it, by 2 July. 

"We expect to substantially complete distribution of the BCS software to the PCs we initially missed by the end of the week," Microsoft said.

Although the software maker claims the BCS software was distributed to 90% of European customers, it has also offered to extend by 15 months the compliance period during which the EC oversees its behaviour.

"We recognise that our obligation was to distribute the BCS to every PC that should have received it. Therefore, we have moved as quickly as we can to address the error and to provide a full accounting of it to the commission," Microsoft said.