Open-source software has again become a major irritation for Microsoft. This time, the issue is the sticking point in negotiations between...

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Open-source software has again become a major irritation for Microsoft.

This time, the issue is the sticking point in negotiations between the company and regulators over a landmark European antitrust ruling last year.

After haggling for months over how Microsoft should comply with the ruling, both sides have been able to agree on nearly every point save one: Microsoft refuses to make some of its proprietary code available for unlimited access under an open-source license.

Microsoft had been facing potential fines of as much as $5 million a day for failing to comply with the requirements the European Union imposed last year. Regulators had fined Microsoft a record $612 million in March 2004, saying the company had gained an unfair advantage by withholding necessary information from rivals and bundling its media player with its Windows operating system.

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After weeks of particularly intense discussions, Microsoft and regulators have been able to craft an early-stage deal.

As part of the agreement, Microsoft said it would unveil more product information that rivals could use to make their computer systems compatible with the Windows operating system.

The agreement would apply on a worldwide basis, not just in Europe.

The sides could not agree on distributing that information as open-source software, which is generally freely available for developer use.

Microsoft said it would not allow the underlying workings of Windows to be distributed on such broad terms.

“Doing that will extinguish our U.S. trade-secret rights,” Brad Smith, Microsoft’s top lawyer, said in an interview yesterday.

Both sides have decided to let a European court, the Court of First Instance in Luxembourg, rule on the issue, which could take months, possibly years.

In a statement released yesterday, Europe’s top antitrust enforcer seemed committed to the open-source cause.

“I remain determined to ensure that all elements of the [European Union] decision are properly implemented,” said Neelie Kroes, the Europan competition commissioner.

“This includes the ability for developers of open-source software to take advantage of the remedy.”

An open-source software group said yesterday that allowing a court to decide the issue marks a reversal in the progress the EU had made in policing Microsoft.

“If [the European Union] now accepts what Microsoft offers, then what they do essentially is they give up their victory,” said Georg Greve, president of the Free Software Foundation Europe.

Regulators appeared to be satisfied with Microsoft’s work on developing a special version of Windows that does not have Microsoft’s own media player installed. The system will be called Windows XP Home (or Professional) N.

Smith said he expects Microsoft to announce later this week its timetable for launching the operating system in Europe.

Kim Peterson: 206-464-2360 or

$9 million judgment

against Microsoft

A federal jury in California has slapped Microsoft with a nearly $9 million judgment in a patent-infringement lawsuit filed by a Guatemalan inventor.

Carlos Amado, 50, sued Microsoft in March 2003, claiming it infringed on a patent he received in 1994 for software linking the company’s Excel spreadsheet and Access database programs.

Amado, who had sought $500 million in damages, alleged in U.S. District Court in Santa Ana, Calif., that Microsoft added an application that mimicked his software to the 1995 version of Office.

Microsoft maintains its own engineers started developing technology linking Excel and Access as early as 1989 and that it never infringed on Amado’s patent.

Microsoft spokeswoman Stacy Drake said it was too early to tell whether Microsoft would appeal the verdict.

The jury did not find Microsoft’s patent infringement was willful, as the plaintiff had argued.

The Associated Press

Mobile e-mail upgrade targets BlackBerry

Microsoft will offer a free upgrade to its e-mail and mobile-device software later this year that sends messages to phones and organizers in a push to take sales from Research In Motion’s BlackBerry devices.

The updates to Exchange server and Windows Mobile software will make it easier and less costly to send e-mail and transfer address books and appointments to handheld computers, said Scott Horn, Microsoft’s senior director of mobile devices.

Chief Executive Steve Ballmer unveiled the technology, Windows Mobile Direct Push, at a Microsoft conference in Orlando, Fla., yesterday.

Bloomberg News

AT&T deal focuses

on VoIP programs

AT&T and Microsoft signed a five-year agreement for developing Internet-based communications services for large businesses.

AT&T will integrate Microsoft products into its voice-over-Internet-protocol, or VoIP, product, allowing customers to make voice calls through a Web-based network directly from Microsoft Office software, the companies said yesterday in a statement.

Bloomberg News