For Immediate Release: March 24, 2004

SAN FRANCISCO, CA – Today, European regulators delivered a major blow to Microsoft, hitting the software maker with a record fine and new rules in addition to the sanctions the company already faces under American antitrust law.

“It’s a sad day for future innovation and competition when those companies that failed to have their way under American law can simply go to Europe and have their case opened again,” said Sonia Arrison, director of Technology Studies at the Pacific Research Institute.

“This sets a bad precedent. Consumers don’t benefit when companies spend their resources in court, they benefit when those dollars are spent creating new products,” she said.

According to the EU's competition commissioner, Mario Monti, talks between Microsoft and EU regulators broke down over the inability to agree on “clear principles” for “future conduct.” PRI's Arrison saw the decision as a revelation of the mistaken mindset that it is possible to predict future technologies and markets well enough that regulations can be prepared in advance.

“Some might see this decision as an attempt by the EU to get ahead of the US in the technology sector,” Arrison said. “By using the guise of antitrust concerns, European regulators can cripple American business, allowing European firms to catch up.”

Arrison warned that slowing down the front-runner in a competitive marketplace is not the best way to serve consumers. Instead, she recommended that European policy-makers focus on cutting taxes and regulations to free up their best minds to compete on a more equal footing with Silicon Valley and Redmond.

“Everyone knows that doing business in Europe is incredibly taxing,” said Arrison, “but this decision takes that view to an entirely new level.”

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About PRI
For more than two decades, the Pacific Research Institute for Public Policy (PRI) has championed individual liberty through free markets. PRI is a non-profit, non-partisan organization dedicated to promoting the principles of limited government, individual freedom, and personal responsibility.