Europe starts antitrust inquiries against IBM; IBM blames Microsoft

BERLIN — The European Commission opened investigations Monday into whether IBM had abused its dominant position in mainframe computers, signaling that the era of aggressive prosecution of U.S. technology leaders in Europe did not end with the Microsoft antitrust case.

The commission said it would examine whether IBM had shut out rival mainframe software vendors and service providers. The investigation could lead to charges and potential fines against the company.

In a statement Monday, the commission, the executive arm of the European Union, said it would investigate whether IBM had illegally tied sales of its mainframe operating system to its mainframe hardware, responding to complaints by third-party sellers of hardware.

The commission also said it was opening a separate investigation on "its own initiative into IBM's alleged discriminatory behavior towards competing suppliers of mainframe maintenance services."

The second investigation focuses on whether IBM delays the sale of spare parts to third parties, potentially blocking competitors from performing maintenance on its mainframes.

By opening its own inquiry, the commission has indicated that there might be substance to the antitrust claims.

IBM said Monday that it would cooperate with the European investigation. But the company said the claims were without merit and called the companies that filed the complaints "proxies of Microsoft."

Microsoft competes with IBM, and IBM accused Microsoft of orchestrating the complaints to promote sales of its Wintel servers.

"Let there be no confusion whatsoever: there is no merit to the claims being made by Microsoft and its satellite proxies," IBM said. "Certain IBM competitors, which have been unable to win in the marketplace through investments in fundamental innovations, now want regulators to create for them a market position that they have not earned."

The commission's investigations involved complaints from two rival companies that make and distribute competing software for IBM's proprietary mainframe operating system.

Those companies are TurboHercules, a French maker of open-source software for mainframe computers, and t3 Technologies, a U.S. distributor of Flex software that runs mainframes.

The software made by the companies works on less-expensive computer servers, mimicking the functions of IBM's entry-level mainframes.

Other mainframe makers, like Unisys, Bull, Fujitsu and Hitachi, are selling small numbers of their proprietary mainframes to existing corporate and government customers as replacements for older machines, said an IDC analyst, Matthew Eastwood. They do not compete directly with IBM.

The IBM investigation comes on the heels of a European Union investigation into Intel, the world's largest chip maker. The commission fined Intel $1.45 billion in May 2009 for abusing its dominance of the chip market. Intel, based in Santa Clara, Calif., is appealing the commission's judgment and fine.