Update: EU says Microsoft move may be insufficient

Microsoft's offer to license part of its Windows source code to competitors is "not necessarily enough" to head off €2 million (US$2.43 million) in daily fines for the company, a European Commission spokesman said on Thursday.

Asked whether the move by Microsoft would be enough to bring the company into line with the Commission's March 2004 antitrust ruling, Jonathan Todd, spokesman for European competition commissioner Neelie Kroes, said: "It would be premature to conclude access to the source code would resolve the problem of the lack of compliance with our decision."

On Wednesday, Microsoft general counsel Brad Smith announced that the company would license source code for communications protocols used by its workgroup server software in an effort to meet the Commission's complaints that Microsoft was still failing to comply with the terms of its antitrust decision.

Smith said Wednesday that Microsoft had already complied with the Commission's demands on server interoperability by providing 12,000 pages of documentation on the protocols.

Todd responded Thursday that, "It's a question of the quality of the information, not the quantity."

"They could give us half a million pages, but if it's not the right information to allow competitors to make Microsoft-compatible workgroup server products it doesn't solve the problem of compliance," he said.

Microsoft's offer was dismissed by some of its rivals as a "public relations ploy" that would inundate developers with useless information.

U.K. analyst company Ovum Ltd. also criticized the offer, calling it "superficially appealing."

"There's no doubting that the source code for software represents the most accurate and reliable documentation," Ovum analysts Gary Barnett and David Mitchell wrote in an e-mail to clients. However, "source code is of little practical benefit to those trying to develop interoperable code -- there is simply too much of it, and it's too hard to understand."

Instead, Microsoft should work with the Commission to figure out what's wrong with the technical documentation it has provided, the analysts said.

"This would represent a far more suitable and sincere attempt to bring this saga to a close, rather than adding another dimension to an argument that is already confused," the analysts wrote.

The technical documentation is supposed to help competitors develop products that can interoperate well with Microsoft's dominant Windows software. The Commission believes this will help level the playing field for competition.

In a statement issued Thursday, Microsoft said it welcomes the Commission’s comments that it would "seriously consider our offer to license the Windows source code to competitors."

The statement said that, in addition to the source code, programmers would get a set of detailed technical specifications as well as free technical support from Microsoft engineers. This is the equivalent, the statement claimed, of "providing the finished airplane, a complete set of blueprints and free flying lessons" and would give programmers everything they need to work with Windows communication protocols.

Microsoft added that it was prepared to “do more” to make the necessary technical documentation available if the Commission requests it.