Microsoft to Adobe: Lets Make a Deal

Updated: Adobe, not content with Microsoft's decision to cut certain PDF functionality out of Office 2007, also wants changes in MS' new document display and printing tech. Will the result be more antitrust action? (Microsoft Watch)

Following a published report claiming that Adobe Systems is poised to launch an antitrust suit against Microsoft over Microsofts Office 2007 planned PDF support, Microsoft is going on the offensive and discussing what has led to the impasse between the two companies.

Adobe has been in discussions with Microsoft for the past four months over alleged tying and predatory pricing concerns that Adobe has regarding Microsoft XPS (XML Paper Specification) and "Save to PDF" technologies that Microsoft was planning to integrate into Windows Vista and Office 2007, said David Heiner, vice president and deputy general counsel in Microsofts legal department.

/zimages/2/28571.gifAdobe moves to bridge Flash and Flex with AJAX (Asynchronous JavaScript and XML). Click here to read more.

When asked whether Microsoft is expecting Adobe to launch an antitrust suit against the company or simply go to U.S. or European Union regulators with their concerns, Heiner said "they [Adobe] are threatening legal action," but would offer no further specifics.

Adobe is looking to make a case that Microsoft is violating tying and predatory-pricing regulations with XPS and Save to PDF, Heiner said.

Adobe is claiming that PDF export technology constitutes a separate product and that Microsoft is tying both Save to PDF and Save to XPS to Vista and Office 2007 and is making them available for free, thus undercutting Adobes ability to charge for these kinds of plug-ins, according to Heiner.

"I couldnt say, legally, how this would play out," said Directions on Microsoft analyst Robert Helm.

"In the United States, Adobe would need to show that Microsoft is leveraging a monopoly in one market to monopolize a second market. They will have to convince a judge that the second market exists, and that it might be possible to monopolize it. The U.S. Department of Justice was never able to pull that off. The European Commission is a different matter altogether."

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