Reports: Microsoft Readies Proposal For EU Antitrust SettlementReports: Microsoft Readies Proposal For EU Antitrust Settlement

Microsoft plans to submit a detailed proposal aimed at settling the European Union's antitrust investigation, according to reports published Wednesday.

The proposal will explain how Microsoft plans to address European accusations that it has abused its market power in music software and network servers, according to reports by the Wall Street Journal and Reuters.

European regulators and Microsoft are far apart on a settlement, according to reports. Microsoft had said its deal with the U.S. Department of Justice and state governments goes a long way toward addressing European antitrust concerns. But the EU has resisted Microsoft's efforts, saying the company needs to offer remedies tailored to address European concerns.

European regulators say Microsoft doesn't disclose enough information to allow servers made by competitors such as Sun Microsystems to communicate with Windows systems. Microsoft counters that disclosing more information than it does will jeopardize its incentive to integrate.

Europe also contends that integrating the Microsoft media player with Windows makes it difficult for competitors. Europe wants Microsoft to remove the media player from Windows and sell it separately; Microsoft is resisting.

Microsoft declined to confirm the reports. "We have no comment on this other than to say we have cooperated fully with the European commission on this matter and are open to sitting down and discussing ways to resolve these issues whenever its convenient for the commission," a company spokesman said.

The European investigation is one of several antitrust legal battles Microsoft is fighting. A federal judge upheld a settlement in the main action, brought by the U.S. Department of Justice and a coalition of states and the District of Columbia, in November. The settlement called on Microsoft to open interfaces to competitors, lift restrictions on PC vendors for modifying Windows, and cut out preferential treatment to selected PC vendors and Internet service providers.

Most of those states decided to accept the November ruling, but Massachusetts and West Virginia are continuing their appeal.

Meanwhile, private plaintiffs, including Sun and Be Inc., are pursuing their own antitrust lawsuits against Microsoft.

Sun is seeking to force Microsoft to include the standard version of Java in Windows and Web browsers. Sun achieved an early victory this year, when a federal judge handed down a preliminary injunction ordering Microsoft to ship Java, at least until the full-blown trial is resolved.

And Microsoft reached a $1.1 billion settlement this month to a class-action suit brought by California consumers and enterprise customers. Class-action suits in 16 other states are pending.