MS, Adobe PDF talks break down
In the past, Microsoft has run afoul of regulators in the US and Europe, in part because officials deemed the company's strategy of bundling features.india Updated: Jun 05, 2006 12:04 IST
Microsoft Corp's negotiations to use Adobe Systems Inc's technology in its new Office business software broke down earlier this week and Adobe threatened legal action, Microsoft's top antitrust lawyer said on Friday.
The previously undisclosed talks between the two sides centred around Microsoft's plan to allow users to save work under Adobe's Portable Document Format, or PDF, within the company's Office 2007 suite of applications and its new Windows Vista operating system.
Adobe objected to Microsoft building the "save as PDF" option into Office and Windows, arguing that the ability to save a document in a fixed document format, such as PDF, is a separate product and should not be free, Microsoft said.
"Adobe has been threatening legal action," said Dave Heiner, Microsoft's head lawyer for its antitrust group within its law department. He declined to comment about whether he expected Adobe to file an antitrust suit.
Adobe declined to comment on the nature of its discussions with Microsoft, but company spokeswoman Jodi Warner said it has discussed with regulators around the world its concerns that Microsoft may abuse its "monopoly" position.
"Adobe has made no determination to take legal action against Microsoft," said Warner in a statement.
In the past, Microsoft has run afoul of regulators in the US and Europe, in part because officials deemed the company's strategy of bundling features, such as a Web browser and media player, into its dominant Windows operating system as anti-competitive.
In order to avoid a legal clash, Adobe requested Microsoft remove the "save as PDF" option from the new Office and wanted to have users download the "add-on" function for a fee, said Heiner, who is also Microsoft's deputy general counsel.
Further, Adobe asked Microsoft to also remove the ability to save a document under Microsoft's XML Paper Specification, or XPS, format -- a rival to Adobe's PDF technology -- and then charge a fee to add the XPS feature into Office.
Microsoft agreed to remove the built-in ability to save a document using both the PDF and XPS file format from Office, but refused to charge users a fee to download the two formats because there are rival products that already allow users to create PDF documents for free.
"It's really come down to this pricing issue and we're not willing to do that," said Heiner.
San Jose, California-based Adobe charges for the popular Acrobat document-sharing software to create PDF documents, while giving away a PDF reader to view the formatted documents.
It also faces increasing competition from Microsoft which is targeting the design market in a potential threat to the businesses Adobe has built providing graphics software tools.
Adobe chief executive, Bruce Chizen, had said in February that he considered Microsoft to be the company's biggest concern.
Redmond, Washington-based Microsoft argues that Adobe offers for free the technical specifications to allow other software companies to build applications that allow users to save documents using PDF.
A competing software to Microsoft's Office from Apple Computer Inc and an open-source product called OpenOffice allow users to save in PDF.
"It seems (Adobe's) new position is that the PDF standard is now open to for some to implement, but not all," said Jonathan Zuck, president for the Association for Competitive Technology.