Below is the text of a statement delivered by Brad Smith, general counsel for Microsoft (MSFT). The statement was made in Luxembourg, less than a couple of hours after an appeals court backed the European Commission’s aggressive stance against the software giant. The EU judgment could have an effect on how regulators pursue other dominant technology companies, such as Intel (INTC), Google (GOOG) and Apple (AAPL).
BRAD SMITH: Well, we’ve obviously only had a very short amount of time to read the decision that the court issued today, and it’s the type of decision that deserves the kind of time required to understand it thoroughly.
It is nonetheless clear that the court has agreed with the Commission on a number of the Commission’s points, and I do want to simply start by expressing our gratitude to this court for the lengthy consideration that it gave to these issues. These are obviously complicated and important topics, and we appreciate all of the objective and thorough work that went into the decision that was issued today.
We appreciate the court’s judgment on the trustee issue and the monitoring mechanism, an issue where the court agreed with us, and yet I would be the first to acknowledge that I don’t think anyone would say that is the most important part of this case or this decision.
It’s clearly very important to us as a company that we comply with our obligations under European law. We’ll study this decision carefully, and if there are additional steps that we need to take in order to comply with it, we will take them.
It will take us a little bit of time, at least over the next few hours, to read the decision carefully, but certainly that is one of our strongest convictions as we go forward.
We have been working hard over the last few years to address these issues. Everyone agrees, for example, that the version of Windows that we offer in Europe today is in compliance with the Commission’s 2004 decision, and I’m also gratified that we were able to have the kinds of constructive discussions with the European Commission last year that enabled us to bring to market Windows Vista in conformity with the Commission’s 2004 decision.
In addition, there’s obviously a lot of work that has gone into our efforts to comply with the Commission’s terms with respect to communications protocols and our duty to license them, a duty that obviously was reaffirmed by the court’s decision today. We’ve made a lot of progress in that regard, and yet we all have to acknowledge that there are some issues that do remain open.
As we read today’s decision more carefully, we’re hopeful that some aspects of it may add some clarity that will help us all implement these remaining parts of the decision. And as I said, if we need to take additional steps in order to comply with today’s decision, we will do so.
I would note that a lot has changed since this case started in 1998. The world has changed, the industry has changed, and our company has changed. We sought to underscore that over a year ago when we published what we described as our Windows Principles, principles intended to ensure that future versions of Windows, starting with Windows Vista, would comport not only with the principles of U.S. law but with the principles that are applicable here in Europe as well.
We’ve sought to be open and transparent, and we’ve sought to strengthen our ties with the rest of our industry. Indeed, it’s notable that just last week we announced a new agreement with Sun Microsystems, and the week before that we announced a new agreement with Novell, two of the companies that started out on the other side of this case almost nine years ago.
A lot has changed, but I will say that one thing has remained constant, and will continue to do so, and that is Microsoft’s commitment to Europe. When this case started, we published Windows in 24 European languages; today that number is 41, and it will continue to grow. When we started this case, we had 3,900 employees in Europe; today we have 13,000, and that number will continue to grow. When this case started, we were spending $3 million a year on research and development in Europe; today we are spending almost half a billion, and that number will continue to grow. Today we work with over 200,000 business partners, who employ almost 3 million people on the European continent, and that number two will continue to grow.
So, we look forward to continued efforts to implement and comply with today’s decision, we welcome the opportunity for continued discussion to adhere to our duties with the European Commission, and we look forward to hopefully continuing to move technology forward to create more jobs on this continent.
Thank you very much.
QUESTION: (Off mike).
BRAD SMITH: I think we need to read the decision before we make any decisions. I believe in these kinds of things that although there’s a lot of drama, one needs to step back and read first, think second, and decide third, and I think that’s the right order, and that is the order in which we’re going to take this.
QUESTION: (Off mike).
BRAD SMITH: I don’t want to talk about what will come next in terms of the legal process. As I said, we need to read the decision, it’s a long decision, and it really helps to read something before one makes a conclusion about what to do about it.