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Antitrust probe aims at Microsoft British venture

BRUSSELS, Belgium -- The European Commission said Wednesday it was opening a full antitrust probe into the proposed acquisition by Microsoft Corp. and Liberty Media Corp. of joint control in British cable company Telewest Communications PLC.

The investigation will focus on sales of software for digital set-top boxes for cable television in Britain, the commission said in a statement. The European Union executive body said it had "serious doubts" about the impact of the deal. It is expected to make a decision by early August.The commission added it was concerned the transaction could strengthen Telewest's dominant position as an exclusive supplier of cable services to consumers within its franchise area. The statement said EU regulators would look at the interests of consumers to ensure technology is not used to restrict choice.

Microsoft recently took a $5 billion stake in AT&T, in part to increase its share of set-top boxes running on its Windows CE software. Denver-based Liberty Media is a subsidiary of AT&T.

Last September, Microsoft and Liberty took a $493 million stake in UnitedGlobalCom Inc., a major cable television provider in Europe and Australia.

The concentration of Internet investments in Europe may have antitrust regulators worried that Europeans may not have non-Microsoft options in the future.

Microsoft spokeswoman Erin Brewer said the company would cooperate with the probe.