Erkki Liikanen, the European Commissioner for Enterprise and Information Society who is visiting New Delhi, told reporters that the European Commission was ready to face any court action that Microsoft might initiate against it.

"We are strong believers in competition and have taken a significant decision.... It is for them (Microsoft) to challenge it," said Liikanen.

"We have a strong case but we are not above the law. If Microsoft takes us to court we are ready to defend our decision in court and abide by the court's ruling," he added.

At the end of a five-year investigation, the European commission announced on Wednesday that it was fining Microsoft 497 million euros (611 million US dollars) in a landmark anti-trust ruling that labelled the US software giant a predatory monopolist.

Microsoft said it would appeal to the European Court of Justice and seek to have the sanctions suspended.

The European Commission also ordered Microsoft to offer a European version of its all-conquering Windows operating system without Media Player, a software product that is able to play back music and video content over the Internet, within 90 days.

The US firm has been ordered to disclose "complete and accurate" data within 120 days to enable rival companies to offer servers that can work with Windows.

The unprecedented size of the EU's financial penalty might not hurt Microsoft, which has cash reserves of some 53 billion dollars.

But analysts say enforced changes in Europe to its Windows operating system, which currently powers nine out of 10 personal computers, will hurt.

After largely settling its anti-trust problems at home through the 2001 deal with the US Justice Department, Microsoft sees no reason why it should undergo a drastic product overhaul in Europe.

Being forced to unbundle Media Player would be the thin end of the wedge for a company that has placed an all-in-one suite of applications at the heart of its hugely successful business strategy.

"Microsoft stifled competition by deliberately restricting interoperability between Windows PCs and non-Microsoft work group servers and by bundling its Windows Media Player with its Windows operating systems," said Liikanen.

"We hope our decision will refocus competition," he added.

SPACE.WIRE