[Techtaffy Newsdesk]

The European Commission has imposed a €561 million (around $732 million) fine on Microsoft for failing to respect an antitrust settlement. While the fine is substantial, Microsoft can afford to pay it off with its $68 billion cash reserves. Microsoft has acknowledged that the company indeed failed to comply with its commitments.

Microsoft: We take full responsibility for the technical error that caused this problem and have apologized for it. We provided the Commission with a complete and candid assessment of the situation, and we have taken steps to strengthen our software development and other processes to help avoid this mistake – or anything similar – in the future.

The Redmond giant did not roll out a browser choice screen with its Windows 7 Service Pack 1 from May 2011 until July 2012; in 2009, the Commission had made these commitments legally binding on Microsoft until 2014. 15 million Windows users in the EU did not see the choice screen during this period.

Joaquín Almunia (Commission vice president, Competition Policy, EC):  Legally binding commitments reached in antitrust decisions play a very important role in our enforcement policy because they allow for rapid solutions to competition problems. A failure to comply is a very serious infringement that must be sanctioned accordingly.

The choice screen was provided as of March 2010 to European Windows users who have Internet Explorer set as their default web browser. While it was implemented, the choice screen was successful with users, says the Commission. For example, until November 2010, 84 million browsers were downloaded through it.

When the failure to comply was detected and documented in July 2012, the Commission opened an investigation and before taking a decision notified to Microsoft its formal objections in October 2012.

This is the first time that the Commission has had to fine a company for non-compliance with a commitments decision.

In the calculation of the fine, the Commission says it took into account the gravity and duration of the infringement, the need to ensure a deterrent effect of the fine and, as a mitigating circumstance, the fact that Microsoft has cooperated with the Commission.

Edited: 03-08-13