Should Microsoft Be Excluded From EU Government Sales?

David Gerard writes "From Groklaw: Heidi Rühle, a Green Party MEP, has presented a question regarding whether or not Microsoft should be considered as having failed to fulfill the conditions to participate in public procurement procedures in Europe, as laid out in Article 93(b) and (c) of Financial Regulation — '(b) they have been convicted of an offense concerning their professional conduct by a judgment which has the force of res judicata; (c) they have been guilty of grave professional misconduct proven by any means which the contracting authority can justify' — and the Commission anti-trust penalty just happens to fulfill both of those conditions." The EU Commission is required to respond within 6 weeks to such a question from a member of Parliament.

Big Problem for MSFT

The real question here is, how much would the necessary bribe be, and who is corrupt enough in the EU Commission to push this through for MSFT?

Also, will the next big US war be in the UK?

Re:Big Problem for MSFT

Where do you come up with this magic "EU is half of the size of the US business market" number? Where do you derive at this information? According to wiki, EU [wikipedia.org] and US [wikipedia.org] GDP are practically equal.

Anyway, it's the other way around about your statement. It's "who is corrupt enough to be bought off by MS to cancel this", not the other way around. Meanwhile, if MS even tries to cancel this it will backfire on them bigtime (antitrust round 3 anyone?). I'd say that this is pretty much guaranteed although the bigger question is how to enforce existing contracts through that duration and also the question of if the countries in the EU will have the balls to follow through on this.

Not to be totally ad hominem, but where is your incorrect logic coming from? The situation here is the exact opposite of what you posted, and coincides with your signature. WTF?

It's like one of those spam letters with a philosophical message at the bottom.

Re:Big Problem for MSFT

1/2 the size regarding landmass. i'm pretty sure the true (software) market size of the EU is larger when compared to the US.

Re:Big Problem for MSFT

Software chosen by government tends to trickle down to corporations, which tends to trickle down to home users (although to a lesser extent). So if Microsoft software were to be replaced in EU governments it would eventually influence a population that's larger than the US and Canada combined.

Re:Big Problem for MSFT

Yup, about 63% larger.

US Population: 301,139,947
EU Population: 490,426,060

Re:Ah, you forget...

You forget that the USA population is growing

Yep, but as it's mostly around the waistline that they're growing, they'll all be dead of obesity-related illnesses by the time they're 40 ;-)

Re:Ah, you forget...

You forget that the USA population is growing, while Europe's population is in decline.

Actually, the population of the EU is increasing. Fast. We may not be doing an awful lot of breeding, but look at those borders go! We're the only major power on earth with an active policy of territorial expansion.

Re:Big Problem for MSFT

Not really...The issue here is whether or not the EU as an administration should order products/licenses from Microsoft.

The issue isn't whether or not Microsoft can do business in the EU. The European union bureaucracy is huge, but not that huge.

As an European and an user of open source products I don't support this proposition.

Microsoft has been punished already. Time to move on. Microsoft is already facing serious competitions and its dominant position looks less invicible than it used to be.
Technically/Financially Open Source is the way forward for public services. But if Microsoft can prove that their products are objectively better for an administration, then I see no reason why it shouldn't be used.

Leftists such as this green party are taking it as an easy ideological shot against big companies (they hate them). I don't support that.

Re:Big Problem for MSFT

actually, this is simply following their own procedures. if you have a law regarding procurements that states in what cases a company can not participate, you sort of are expected to follow it. mostly.
in this case the question would be whether a single company should be awarded an exception.

Re:Big Problem for MSFT

Microsoft has been punished already. Time to move on. If Microsoft can prove that their products are objectively better for an administration, then I see no reason why it shouldn't be used.

Why should any government, or any organization for that matter, do business with a company convicted of illegally influencing their industries? And add to that the fact that Microsoft has not significantly adjusted their business practices, which demonstrates that they have not been adequately punished.

But this shouldn't be about punishment. It's about who you want to do business with. I don't think any government should buy licenses from a software company that's been found guilty of manipulating the software industry. If you can't play by the rules you shouldn't be allowed to play at all.

Re:Big Problem for MSFT

Microsoft has been punished already. Time to move on.

Not true, it has NOT been punished, because it didn't do yet what it has been asked to.

Re:Big Problem for MSFT

Perhaps if Ballmer had to spend a few months behind bars?

You're not suggesting that corporate leaders have to actually pay for their crimes, are you? What kind of backwards place is Europe, anyway?

Criminal organisation

They're basically a criminal organisation according to EU law. I don't want to deal with an organisation that habitually breaks the law.

Re:Criminal organisation

Yeah, I have to say it's nice to see somebody treating MS like the convicted monopolists they are (hint hint wink wink nudge nudge).

Re:Criminal organisation

Finally Regan's trickle down theory with practical applications. Go EU prove Regan right for once.

Re:Criminal organisation

It's not generally considered something the government should endorse, since it's the government that makes the laws to begin with.

This is unlikely to happen

For a start this is not EU-wide. Basically there is an EU directive that states EU members are allowed to block contracts from companies breaking the rules listed in Article 93,
 

1. Candidates or tenderers shall be excluded from participation in a procurement procedure if:

(a) they are bankrupt or being wound up, are having their affairs administered by the courts, have entered into an arrangement with creditors, have suspended business activities, are the subject of proceedings concerning those matters, or are in any analogous situation arising from a similar procedure provided for in national legislation or regulations;
(b) they have been convicted of an offence concerning their professional conduct by a judgment which has the force of res judicata;

(c) they have been guilty of grave professional misconduct proven by any means which the contracting authority can justify;

(d) they have not fulfilled obligations relating to the payment of social security contributions or the payment of taxes in accordance with the legal provisions of the country in which they are established or with those of the country of the contracting authority or those of the country where the contract is to be performed;

(e) they have been the subject of a judgment which has the force of res judicata for fraud, corruption, involvement in a criminal organisation or any other illegal activity detrimental to the Communities' financial interests;

(f) following another procurement procedure or grant award procedure financed by the Community budget, they have been declared to be in serious breach of contract for failure to comply with their contractual obligations.

2. Candidates or tenderers must certify that they are not in one of the situations listed in paragraph 1.

But that is not a mandatory for all EU states, it is only mandatory for EU institutions and some member states. But even that is a pretty massive lump of the EU market and would sting like hell (the ban would be for 5 years). Not only that but imagine the resources turned onto moving from MS to Open source solutions. It could end MS as a major player in the EU institutions and that would knock on into the private sector.

Not to mention the added bonus of all that cash heading into European projects like KDE and linux instead of overseas.

Not sure what the American Gov would think of it though...

Re:EU is picking winners: Why.

If Microsoft wasn't the best choice, why elminate them from the process?

Who is going to benifit the most from this, and what is the connection to this group?

Is there an eu msft that they are trying to shepard to the big time, or is it simple corruption?

Who wins with MS out of the picture?

I'd say we all win when a strong message is sent to large corporations that says "we will not tolerate illegal behavior from you, and we will stand by this principle even if this means we must make some sacrifices". It's called having a spine. Ideally the goal is not necessarily to get MS out of the picture (unless they refuse to reform their business practices, that is) but to get this kind of behavior out of the picture.

"Nothing that you sell is so good or so vital that we will put up with your abuses in order to purchase it" is an attitude that I wish were more widespread. How this plays out and whether that message is actually sent will be interesting indeed.

Re:EU is picking winners: Why.

I'd say we all win when a strong message is sent to large corporations that says "we will not tolerate illegal behavior from you, and we will stand by this principle even if this means we must make some sacrifices". It's called having a spine.

Well said. I mean, come on... public money vs. convicted criminal organisation... it doesn't take a lot of ethics to work out that Microsoft products shouldn't be bought by our governments.

Re:EU is picking winners: Why.

If Microsoft wasn't the best choice, why elminate them from the process?

Microsoft has repeatedly broken the law to become the "best choice" by introducing artificial problems with competing products. It's the same issue as "should the government sign a contract with a concrete supplier who has the lowest price, but also has been repeatedly convicted of blowing of their competitors' factories and hiding bodies in the concrete they sell." According to the laws, no the EU should not be giving contract to either MS or this hypothetical concrete supplier.

Who is going to benifit the most from this, and what is the connection to this group?

It doesn't matter who benefits the most. The idea is for the the EU people to benefit by discouraging criminal acts that are harmful to them. If anyone else benefits, it is incidental.

Is there an eu msft that they are trying to shepard[sic] to the big time, or is it simple corruption?

Umm, I don't even understand what question you're trying to ask.

Who wins with MS out of the picture?

The people of the EU win.

Re:EU is picking winners: Why.

Ya see, it's that last line that I'm worried about. I don't think they do.

That is certainly a valid opinion, if one I don't share and question your ability to support.

One of the big things that open source offered to me was choice. Whether it's the megacorp, the small company, or open source. Which ever I chose to use. Restricting choice in any way is a bad thing.

And it's that last line which I have issues with. Is restricting say, the choice of people to give large cash contracts to people who recently murdered their wives a bad thing? What we're discussing here is not a matter of one company being favored over another. All companies have to abide by the same laws. MS broke the laws and like anyone else who did that, they have to deal with numerous ramifications of that. People convicted of treason and espionage may be banned by law from serving in the military. Taking that choice away from the military is not necessarily a bad thing. This is the government we're talking about, not a private company. Unlike private companies, they are subject to all sorts of rules regarding their behavior because they exist only to serve the people.

Here's the other thing I'm scared of, tying into the first argument. A couple of my friend working in IT over in europe (one in London, one in France (can't remember his city's name :)) on two separate occasions have said "we need this not to go too much further" in reference to the EU's actions on MS. They are starting to feel like it's just the EU is turning this into a publicity stunt instead of a judicial action.

I think that's a very common feeling. It is my belief that very few people understand antitrust abuse, why it is a crime, and how it works. After a hundred years of living under laws that make antitrust abuse illegal, most people simply assume all markets are functioning free, capitalist ones and don't even understand that there are alternatives. When competing products are artificially broken via antitrust abuse, most people blame the victim, not understanding the mechanism of antitrust abuse. When one, successful company is punished for an action and people don't understand how monopolies can be abused, they often don't even understand how that action differs from legal behaviors by other companies. Certainly very few people look at the big picture of how free trade works in a regulated capitalist market to ensure continued innovation and lower prices. They take innovation and the relatively low costs for granted and while they may have some vague understanding that extreme socialism is "bad" and resulted in disaster in some parts of the world, they don't understand how or why or equate antitrust abuse to causing those very same deficiencies in their own economy.

I apologize for getting long winded. The truth is, a lot of people feel that the EU's actions may be "bad" but at the same time very few of those people understand the reasons and very few have had to live with the terrible conditions the lack of those laws created in the past. (Cue the quote about those who do not understand history.)

Lastly, and this is perhaps the most depressing part, I'm seeing more people yelling "yeah, take that MS" when someone else legislates against microsoft instead of focusing their energy on making software that is unquestionably the better choice.

That is a very interesting choice of words. You said, "legislates against microsoft." Has any law been passed that applies to Microsoft and not everyone else? Nope. No one has legislated against Microsoft, they've just enforced existing laws against Microsoft because Microsoft built thier entire business model on breaking laws and then tying things up in the courts and paying fines and settlements, which they plan on being smaller than the cash they make from breaking the law in the first place. To date, they've been completely correct. The courts are horribly slow and ineffici

Re:I wonder who Heidi Rühle's campaign con

Green party != Greenpeace

After all it's a political party, and they must have more on their agenda than environmental and health issues.

Not every green party member can be minister for environment and/or health.

Re:Ummm, yeah...

I would imagine that the exclusion would follow standard public procurement procedures within the EU, whereby Microsoft would be excluded from applying for public tenders because they weren't compliant with existing regulations.

Where they are already in place, they would not need to apply for tenders. If new departments etc came into existence, then they could use other presentation software and would have budgets for training etc.

So basically Microsoft wouldn't be able to grow their existing base, until they sorted out their compliance. But current users of their software would be unaffected.

Re:That would just about scuttle the Airbus tanker

but when you start losing jobs in Ottawa, Paris, London and Berlin because of a foolish trade war, then, would you at least miss Bush for his stance on free trade?

This is the same Bush who imposed crippling tariffs on European steel firms to protect American firms? And who suddenly saw the importance of free trade once the EU imposed sanctions on the products of several swing states just before the election?

Re:Looks Good on Paper, but...

I think excluding a source of solutions (as bad as we claim it is, regardless) could have a negative impact on the market and competitive.

You do realize that MS is under threat of being banned for the crime of undermining the free market and using criminal actions to make competing products artificially worse, right? How exactly would removing them from bidding on a subset of new contracts for the next 5 years negatively impact competition? There are still dozens of companies with solutions that could bid and compete with one another fairly. In fact, companies that have not bothered investing in those markets and competing because they knew it would result in very poor ROI, would now have financial incentive to invest in competing solutions. I really don't see how you think this would negatively effect competition.

Of course Microsoft could be engaged in underhanded tactics (vis ISO standardization of Office Open XML..).

Microsoft has been engaged in underhanded tactics and after years and years of slow court proceedings they were convicted. The law says that certain government agencies should not give new contracts to companies convicted in this manner for 5 years in order to insure that companies that have been following the law have a chance to compete, instead of having to go up against a company who may be winning contracts solely because their criminal actions have allowed them to undercut others or otherwise prevent them from providing a bid on projects.

I'd like to think that Microsoft's ubiquity may very well have raised the bar/baseline for many different software products.

You'd like to think that? Why? Most software products follow the standard market model. Investors look at a market and potential ROI. They then invest in the markets they think will provide the best ROI. When one company has a huge influence in a market, that allows them to use that influence to break compatibility with others, thereby introducing an artificial problem with that competitor. This means the "monopolist" can make more money with less effort to compete. It also means investors looking at the market see that investing in that market will have to account for trying to work around these artificial compatibility problems in addition to other costs, and at the same time they will always have a very well funded competitor who can take a loss in the short term to undercut them on cost. In short, very few companies invest in those markets and fewer products and innovations result. This is one of the main reasons why antitrust abuse was banned in the first place. It slows down innovation in a market, not speeds it up. I think you have a very wrongheaded idea as to what influence MS has had on markets. Think 8 years after the invention of tabbed browsing before most users saw it. Think 18 years since the first desktop OS to introduce spell checking for all applications, and 90% of users still don't have it.

Ubiquity of the (somewhat decent, I guess) baseline bundled Windows Mediaplayer results in raising the bar in competing media players (iTunes, Winamp?, etc.)

Are you joking? The top two media players are shipped by companies who bundle them with products they have a monopoly or near monopoly on. What does that say about the quality of the players themselves? They aren't competing based upon the merits of the players, but upon the relative popularity of Windows and iPods respectively. For years most users who tried ripping their CD collection put CDs into their computer, told it to rip them, then discovered it had ripped to WMA format and added DRM to prevent them from copying it to any other device, including the most popular portable player. Then consumers had to install different software or figure out how to change the settings and do it all over again. That is not quality. That is the epitome of a really, really poorly made piece of software dominating despite being horribly inferior, and pe