Europe Launches Two Antitrust Investigations Into IBM

EU Launches Two Antitrust Investigations Into IBMEuropean regulators launched two formal antitrust investigations into IBM (IBM) centering on its mainframe computer business, the European Commission announced Monday.

One investigation focuses on allegations that Big Blue ties its operating system to its mainframe computers in ways that prevent emulation software companies from allowing their customers to run critical applications on non-IBM hardware. The commission's actions follow complaints from two companies, T3 and Turbo Hercules, both of which develop emulator software.

In the second case, begun on the EC's "own initiative," antitrust investors are zeroing in on IBM's alleged discriminatory behavior toward third-party mainframe maintenance-service companies. Antitrust investigators are examining whether IBM may be restricting or delaying those companies' access to spare parts for which it is the only supplier.

New Sheriff in Town


Big Blue has stayed out of the EC's antitrust viewfinder for a number of years as the agency has gone after Microsoft in a big way, with historic fines and nearly a decade of legal wrangling under two previous competition commissioners, Mario Monte and Neelie Kroes.

But a new antitrust sheriff strolled into town earlier this year as the EC changed its lineup of commissioners. Joaquin Almunia, the new competition commissioner, has yet to make his mark, but it's still early in his tenure.

IBM is one of the first high-profile technology investigations that he has formally launched, but he's inherited several others, such as Intel's (INTC) marketing and rebates antitrust case.

It's interesting to note that the IBM probe has shades of the Microsoft (MSFT) case. The EC drilled down on Microsoft's bundling of its software applications to its operating system as a means to maintain and extend its dominant position in the software industry. The IBM emulator investigation also centers on allegations of extending dominance via a tight integration of the operating system, but this time with Big Blue's mainframe hardware.

IBM was not immediately available for comment.

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