Microsoft grumbles about a pullout

In a bit of business and regulatory gamesmanship, Microsoft Corp., the U.S. software giant, warned of the possibility that it might have to withdraw from Korea or delay the introduction of new operating systems here. The warning came in an earnings report filed with the U.S. Securities and Exchange Commission, and was linked to a fair trade investigation now under way in Korea. Microsoft said, "If the Korean Fair Trade Commission enters an order requiring Microsoft to remove code or redesign Windows uniquely for the Korean market, it might be necessary to withdraw Windows from the Korean market or delay offering new versions in Korea unless the remedial order is stayed or overturned on appeal." The company was referring to a pending complaint filed by Daum Communications in 2001, which charged Microsoft with illegally integrating its instant messenger service into its Windows XP operating system. The messenger service was first bundled with XP in that year, and Daum said that its message software was being stifled. Even Microsoft’s local subsidiary scoffed at the warning. “We have never considered halting our operations in Korea and it is highly unlikely in the near future as long as we are making profits here,” said a spokesperson of Microsoft Korea. The U.S. parent also backed off a bit after the shot across the Korean regulator’s bow. It blamed U.S. law, saying that it had to inform investors of factors that could materially affect its profits and share price . Last year, Korea accounted for less than 1 percent of Microsoft’s global revenue. The company has invested more than $1 billion here since 1984. In any case, the Fair Trade Commission was not impressed. The anti-trust agency said it would not drop its investigation. "Whether Microsoft withdraws from Korea or not will not affect our ruling," said Kang Dae-hyung, the commission’s vice president. The commission reacted similarly two weeks ago, when Microsoft settled a U.S. suit by RealNetworks that claimed Microsoft’s audio player bundled with Windows unfairly hampered its competing player. RealNetworks withdrew the Korean version of that complaint, but the Korean regulator said it would persist in its investigation of that bundling as well. by Seo Ji-eun