[Sigtis-l] NYTimes.com Article: Microsoft Faces European Commission Inquiry on Privacy Concerns

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Microsoft Faces European Commission Inquiry on Privacy Concerns

May 28, 2002
By BLOOMBERG NEWS 




 

BRUSSELS, May 27 (Bloomberg News) - The European Commission
has begun an inquiry into Microsoft because of concerns
that its .NET Passport system may violate privacy rules. 

The European Commission said last week that it had concerns
about the legality of Microsoft's Passport, which stores
identity data on the company's servers so that Internet
users do not have to re-enter it as they move among
programs and Web sites. 

Microsoft already faces the threat of a fine by the
commission for abusing the dominant position of the
company's Windows operating system, which runs 90 percent
of the world's personal computers. European regulators are
also looking at whether Microsoft's bundling of its Media
Player software with Windows gives the company an unfair
advantage. 

"The commission's advisers have taken a hard-line position"
on Internet-related privacy in the past, said Jon Filipek,
a partner at the Brussels office of Weil Gotshal & Manges
specializing in data-protection matters. 

The commission "is looking into this as a matter of
priority, in concert with national data protection
authorities, as regards the system's compatibility with
E.U. data protection law," the commission, the European
Union's executive arm, wrote to Erik Meijer, a Dutch member
of the European Parliament. 

Rick Miller, a Microsoft spokesman, said, "We understand
there is an investigation, though we are not aware of any
specific concerns." 

Last year, Microsoft signed a voluntary "safe harbor"
arrangement, a seal of approval awarded by European Union
and United States authorities for companies that give
adequate protection to personal information transferred
among regions. Mr. Miller said Passport complied with the
accord. 

Mr. Meijer accused Microsoft of collecting and passing
along information about users of its products to unknown
parties and complained that failure to register could
exclude users from some sites. He also said that someone
using a computer in a public place might unwittingly pass
information to the next user by failing to log off
correctly. 

European Union rules let companies collect and use data
when they can prove a legitimate purpose and that the
subjects were told. 

The original Windows XP, which went on sale on Oct. 25,
asks users repeatedly to open a Passport account. Passport
is required to use some XP programs like the Windows
Messenger instant-messaging and teleconferencing program. 

The commission said it was examining the whether European
Union rules apply to databases outside the union. 

The Electronic Privacy Information Center, an American
advocacy group, asked the United States Federal Trade
Commission in July to investigate Passport, accusing
Microsoft of privacy violations and unfair trade practices.
EPIC was concerned that Windows XP gave the impression that
users needed Passport to see Internet sites or use Windows.
The group is also worried that Microsoft plans to sell data
collected by Passport or use it for unwanted advertising or
marketing. 

http://www.nytimes.com/2002/05/28/technology/28SOFT.html?ex=1023606082&ei=1&en=12510072bd7bb04f



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