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Korean FTC Gives Microsoft Smackdown

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The South Korean Fair Trade Commission (SKFTC) issued their judgment against Microsoft claiming the Redmond company violated South Korean antitrust laws. The penalty includes a $32 million fine as well as an order for Microsoft to offer alternative compliant versions of the Windows operating system.

The judgment, like others against the company, says Microsoft must uncouple Media Player and MSN messenger from the Windows operating system. While Microsoft did suggest back in October in they might need to withdraw Windows from the South Korean market, it appears they won’t be because they announced the do intend to fight the ruling.

“Windows’ Media Server, Media Player and Internet Messenger services were blocking competition and leading to a monopoly in the market, as well as raising the entry barriers to PC server and operating system makers, hurting the interest of consumers,” SKFTC Chairman Kang Chul-kyu told reporters at a news conference.

Microsoft said in a statement released earlier today:

Microsoft today issued the following statement upon being advised of the Korean Fair Trade Commission’s decision in its ongoing investigation of Microsoft under the Korean Fair Trade Law. We disagree with the Commission’s decision and strongly believe that Microsoft has operated within Korean law.

Microsoft’s integration of instant messaging and media player functionality in Windows has created great value for consumers and opportunities for Korean developers who write applications that run on Windows and create devices for Windows.

Competition in these technologies in Korea has been, and remains, vibrant with many new Korean companies successfully offering digital media and instant messaging choices for Korean consumers. This decision could have the effect of chilling innovation in Korea.

We intend to appeal this decision because it is inconsistent with Korean law. Nevertheless, we will continue developing products for Korean consumers in a way that complies with all laws and is pro-competitive. Microsoft has long felt that Korea is an important center of innovation for our industry. We remain committed to Korea and look forward to continuing to serve the interests of Korean consumers as well as the rest of the Korean information technology industry.

This isn’t the first time Microsoft has had problems with anti-trust suits. Last year, the EU ruled against Microsoft and the US has also ruled on some issues although the big case in the US fell apart after some ill remarks from the judge in the case won Microsoft’s appeal. Microsoft is in the process of fighting the EU’s ruling right now.

While the $32 million is a large sum, Microsoft’s coffers are deep. They’ve settled issues with both IBM and RealNetworks already this year. What they’ll do regarding the upcoming version of Windows remains to be seen. They plan to include a lot of new features on this and it’s unclear whether the features on Windows: Vista will create a new round of antitrust problems.

John Stith is a staff writer for WebProNews covering technology and business.

Korean FTC Gives Microsoft Smackdown
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