EU Antitrust Commission forces IBM to consent to 3rd party maintenance competition
Brussels, 14 December 2011 - The European Commission has made legally binding commitments offered by International Business Machines Corporation (IBM) in the mainframe maintenance market. IBM commits to make spare parts and technical information swiftly available, under commercially reasonable and non-discriminatory terms, to independent mainframe maintainers.
The Commission had concerns that IBM may have imposed unreasonable conditions for supplying its competitors in the market of mainframe maintenance services in breach of EU antitrust rules prohibiting the abuse of a dominant market position. The Commission is satisfied that the commitments, revised in light of observations received in the course of a market test (see IP/11/1044), are suitable to solve these competition concerns.
Well, IBM should know better since this issue has been around since 1952, when the U.S. Government filed Civil Action No. 72-344, and entered into to a Final Judgment called the IBM 1956 Consent Decree to eliminate 3rd party maintenance competition. And in 1969 unbleded software from hardware sales thanks to another U.S. vs IBM antitrust suit where the U.S. alleged that IBM violated the Section 2 of the Sherman Act by monopolizing or attempting to monopolize the market.
Back to the EU Case - In July 2010 the Commission opened an investigation over concerns that IBM might be abusing a dominant position on the mainframe maintenance market by hindering the access of independent maintenance service providers to critical spare parts. Such behaviour would potentially place those providers at a competitive disadvantage and breach Article 102 of the Treaty on the Functioning of the European Union and Article 54 of the European Economic Area (EEA) agreement (see IP/10/100)
In September 2011, the Commission consulted stakeholders on commitments that IBM had proposed to remedy these concerns (see IP/11/1044). Today's decision makes the commitments offered by IBM, revised in light of the market test results, legally binding and ends the Commission's investigation.
This is good news for independent companies that maintain IBM equipment.
If IBM were to breach its commitments, the Commission could impose a fine of up to 10 per cent of IBM's total turnover without having to prove a violation of EU competition rules.