Microsoft Appeals Korea Fair Trade Commission Decision

SEOUL, South Korea — March 27, 2006 — Microsoft Corp. today filed an appeal with the Seoul High Court to review the decision in the Korea Fair Trade Commission (KFTC) case against Microsoft. The appeal is a lawsuit seeking revocation of the KFTC’s decision, which was issued last December, based on the law and facts in the case. The company has also requested reconsideration of the decision by the KFTC.

Microsoft continues to believe that its actions are consistent with Korean law and have benefited Korean consumers and the Korean technology industry.

“The facts do not support the KFTC’s position. Consumers can easily download and use a wide range of software from many different companies,” said Jae Hoon Chung, Korea senior attorney for Microsoft. “In fact, market data from Korean Click show that Korean consumers use multiple media players and instant messenger clients. New instant messaging services and media players such as NateOn Messenger and GOM Player are flourishing in Korea.”

The restrictions imposed by the KFTC are more extreme than those required by the European Commission. Unlike in Europe, Microsoft would no longer be able to offer in Korea the existing version of Windows® that is available everywhere else in the world. The KFTC’s decision would create complexities for Korean hardware and software manufacturers in a way that would erode their competitiveness in the global market.

“We believe the Korean IT industry and consumers are best served by the promotion of innovation. Microsoft has provided benefits to consumers and the IT industry through innovations to the Windows operating system in response to consumer and developer demand,” Jae Hoon Chung said. “The restrictions imposed here would limit such innovations and also hamper Korea’s ability to continue to be a world-class IT innovator. The steps we are taking in this case serve the interests of Korean consumers who want products with the highest value.”

Microsoft looks forward to presenting its position and is hopeful that its appeal will be successful.

Microsoft Korea General Manager Jae Sung Yoo added: “Microsoft continues to invest in Korea and believes in Korea’s future as a leading innovator. We remain committed to Korea, to its consumers and to supporting its vibrant innovation in the world market.”

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