Microsoft has lost its appeal against the European Union's 2004 antitrust ruling. The original judgment, handed down in March 2004, demands that the software giant pay a fine of almost 500 million Euros, and strip its Windows Media Player software from versions of Windows XP in order to facilitate competition between media software vendors. Microsoft can still appeal again to a higher European court, a process that may take years, but has yet to announce whether it will do so.

The ruling leaves questions unanswered as to whether Microsoft could face similar claims relating to features in Windows Vista. The EU's Neelie Kroes evaded questions about the possibility of an EU investigation into Vista, saying only that "if it is not in line with our policy, then we will act". According to the Associated Press, analysts disagree over whether any of Vista's new features could prompt an investigation.

The appeal ruling has also lead to a somewhat ungainly spat between the EU and US Authorities. Thomas Barnett of the US Justice Department accused the EU ruling of "chilling innovation and discouraging competition", with Kroes replying that "it's totally unacceptable that a representative of the U.S. administration criticizes an independent court of law outside its jurisdiction".