Microsoft has been slapped with a fine of approximately $11.8 million for price fixing its popular Office Home and Student 2007 suite at a recent retail promotion.
According to Bundeskartellamt, which is an independent federal authority assigned to the Federal Ministry of Economics and Technology in Germany, Microsoft fixed prices on Office at a particularly large retailer which received financial backing from Microsoft.
'The product in question was heavily advertised in the autumn of 2008 in stationary retail outlets. Amongst others, a nationwide active retailer advertised the product with financial support from Microsoft. Even before the launch of the advertising campaign in mid-October 2008, employees of Microsoft and the retailer in question had agreed on at least two occasions on the resale price of the software package 'Office Home & Student 2007'."
Price fixing is becoming a common occurrence with large companies that are able to flex their financial muscles onto their partners and resellers. The practice has been a big problem in the memory business, where companies actually agree with their competition on prices for their products.
Almost without a fight, Microsoft has agreed to pay the fine, saying that it would review its commercial process.
"We will use this case as an opportunity to review our internal commercial processes and ensure that we are in full compliance with German law," said Microsoft spokesman Jack Evans.
