Microsoft's internet browser and media player are the latest target in a Chinese antitrust investigation which could lead to revisiting the company's software bundling issues in the past. As Windows evolve into becoming the world's dominant OS in the 1990s and 2000s, Microsoft's web browser and media player had been the focus of certain antitrust cases instigated by authorities from Europe and the U.S.
In 2001, Microsoft settled a long-running case with the U.S. Department of Justice on the issue of bundling its flagship browser, Internet Explorer, with Windows.
Three years later, Microsoft was ordered to pay a fine of $656 million (€497 million) by the European Union and to produce a different Windows version that is unbundled with its Media Player. The fine was subsequently increased and reached almost €1.4 billion.
According to Zhang Mao, the head of the State Administration for Industry and Commerce (SAIC), Microsoft was suspected of not being fully transparent in divulging information on its Windows and Office sales. The company had so far expressed that it is willing to cooperate with the current investigations.
"After multiple meetings including at high levels, they've expressed a willingness to respect Chinese law and collaborate with investigating officials," says Zhang.
Earlier this month, the SAIC expressed that its office had been suspecting Microsoft with violation of China's anti-monopoly law. It began in June last year when the Chinese investigators made note of the problems with document authentication, bundling, and compatibility of the Office software and Windows OS of Microsoft.
The SAIC, which is one of the three anti-monopoly regulating bodies in China, formally announced that it is investigating Microsoft's activities within the month. Part of its probe involves the raiding of Microsoft offices sprawled in several major cities and meeting Mary Snapp, Deputy General Counsel of Microsoft, for questioning in Beijing.
"The investigation is presently ongoing, and we will disclose the results to the public in a timely fashion," says Zhang. He added that the probe is just one of the nine probes that officials are handling this year. These would include the probe on tourism, insurance, auto manufacturing, telecommunications, tobacco, software, and utilities sectors. The companies which are involved in the investigations are made up of domestic, foreign, trade associations, and state-owned industries.
The Microsoft investigation occurs in the height of anti-trust probing spree that focuses on foreign companies in China. These would also include companies such as German car manufacturer Daimler AG's Mercedes-Benz and Qualcomm Inc, a mobile chipset maker.
These probes on Microsoft and other foreign companies in China have somehow renewed fears of Chinese protectionism. A spokesman from Microsoft declined to give a comment on the issue after being contacted on the phone.
