In the antitrust dispute between Microsoft and the European Commission, they have agreed on at least one thing: The commission's remedy for restoring competition in the market for software that plays music and videos has failed.
Microsoft was ordered two years ago to create a second version of its Windows system without Media Player. On Tuesday, the two sides took turns denouncing each other's interpretation of events that resulted in the 2004 antitrust ruling against Microsoft. The company's appeal of that ruling and its penalties is being heard this week at the European Court of First Instance.
The product minus Media Player, called Windows XP Edition N, has been on sale since last summer, but no personal computer manufacturers have installed it on the machines they sell, Microsoft told the court, and retailers ordered fewer than 2,000 copies.
On Monday, the commission's top lawyer, Per Hellstrom, said a reason for the small number could be that the commission did not order Microsoft to sell the unbundled Windows at a discount to the full version. He hinted that the commission might revise the order to the company to include a price break for the second version.
"If Microsoft now sells these versions at the same price," Hellstrom said, "the commission will have to examine this new policy in the context of the present market conditions."
Microsoft has argued that Edition N's failure illustrates that the market does not want an unbundled version of Windows, while the commission says its lack of appeal reflects that the market for media players has already tipped in favor of Microsoft. Microsoft spent much of its second day in court on Tuesday dismissing the idea of discounting Edition N.
"It wouldn't have made sense asking for a price differential because media players are free," said Jean-François Bellis, a lawyer who represents Microsoft.
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