Euro court to force Microsoft to divulge secrets

A European Union court ruled today that Microsoft will have to abide immediately by an EU ruling that forces the software giant to change its commercial practices before the appeals procedure runs its full course.

The ruling by the Luxembourg-based European Court of First Instance has huge implications for the company, since it forces Microsoft to divulge some trade secrets and produce a version of Windows without its digital Media Player.

The court ruled that delaying the execution of the EU ruling would not cause Microsoft irreparable damage.

“Microsoft’s application for interim measures is therefore dismissed in its entirety,” a court statement said.

“After examining the circumstances of the case, the President finds that Microsoft has not shown that it might suffer serious and irreparable damage as a result of implementation of the contested decision,” the court statement said.

Still, a source close to the company said the ruling still held encouraging comments on the case and hoped it would help reopen settlement talks with the European Commission.

The full appeals process could take up to five years.

EU officials have said a court ruling in their favour would make it unlikely the bloc’s antitrust regulators would reopen talks.

The two sides were involved in settlement talks before EU antitrust regulators fined Microsoft a record £350 million and told the company to reveal some of its trade secrets to competitors and produce a Windows platform without Media Player.

The EU claimed Microsoft abusively wielded its Windows software monopoly and locked competitors out of the market.

Analysts predicted the financial impact on the company would not be huge. Microsoft has already counted the fine against its quarterly earnings, said Matt Rosoff, an analyst with Directions on Microsoft.

Rosoff also predicted the company wouldn’t suffer much in the near term if it’s forced to release a version of Windows without Media Player, because it’s already prepared a version of the operating system without it.

Even if the court makes Microsoft put “Windows lite” on the market, Rosoff said he can’t imagine many manufacturers would want it and consumers are not crying out for it either, he said. “I don’t see a lot of consumer demand for a PC without Media Player,” he said.

Rosoff said the biggest threat was that the ruling, compelling Microsoft to strip something out of its operating system, would set a legal precedent for similar lawsuits.