Microsoft and Brussels restart talks

Microsoft and Brussels have started a new round of talks over a potential settlement of the software company’s antitrust travails in Europe.

The resumption of what one person close to the situation described as the “on again, off again” discussions comes as the regulators move closer to imposing stringent penalties on Microsoft over its practice of “bundling” its Internet Explorer browser with the Windows operating system.

At least two earlier rounds of settlement talks over the past two years foundered, however, and the latest discussions could mark the last chance for a truce before the European Commission takes action early this autumn.

Neelie Kroes, the European competition commissioner, has said that she intends to resolve the case before she leaves office.

Microsoft has faced the likelihood of a big fine and new regulations on how it operates in Europe since the Commission issued a statement of objections earlier this year.

The ruling upheld a complaint by browser maker Opera, which claimed that Microsoft had gained unfair advantage by including its browser with Windows.

That case was set in motion after a legal ruling in September 2007 which gave Brussels the power to challenge Microsoft’s ability to bundle other software with Windows.

Microsoft tried to reach a settlement with Brussels after that ruling, and the talks advanced as far as personal meetings between Ms Kroes and Steve Ballmer, chief executive, before collapsing.

A second round of discussions in late 2008 also foundered, leading to the Commission issuing its formal complaint.

The timing of the latest talks is not surprising given the imminence of action from the Commission, according to a person familiar with the situation.

Brussels has been exploring different ways of forcing Microsoft to give PC users more choice of the internet browser that they use, either by requiring the company to present users with a “ballot screen” that offers them a choice or browsers to download or forcing it actually to bundle software for rival browsers in Windows.

Microsoft has countered by saying that it will sell the next version of Windows in Europe without any browser, including its own, to comply with previous regulatory rulings.

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