The EU Meddling In US Tech Industry Grows

The EU regulators who combat monopolistic practices have never been kind to Microsoft (MSFT). They have hounded the world’s largest software company for years, accusing it of bundling its browser into its operating system and other actions that make it hard for the company’s competitors to get fair access to the market. Everything the regulators say may be true.

More recently, EU officials accused Intel (INTC) of treating its smaller competitor AMD (AMD) badly by cutting special deals with PC companies to keep its dominance in the chip market. Regulators in Europe have gone so far as to release e-mails that they used to determine that Intel had violated anticompetitive regulations.

The latest victim of EU vigilance is Oracle (ORCL) which has been trying to buy Sun Microsystems. US regulators did not seem to have trouble blessing the deal. There were no objections from antitrust officials in any Asian country. The EU, however, is worried that the combined company may have too much of the database software market in Europe, so its is conducting a long investigation into the matter.

Oracle’s CEO Larry Ellison claims that Sun is losing $100 million a month and that the EU review is hurting his company’s chances of getting a reasonable return on the Sun transaction. He is probably telling the truth. The Sun deal was supposed to have closed two months ago.

The EU has now become the major roadblock to global tech companies that want to introduce or expand dominate products or make marriages to increase the size of their businesses. There is no getting around that. Neither the companies themselves of the US government has any leverage to make EU regulators change their habits. Like it or not, no signifcant global tech deal or global enhancement to important products made may hardware or software giants can be complete until the EU has its say in the matter.

Douglas A. McIntyre