Microsoft's rivals are taking the fight to the software giant

The world's largest software company is accused of using its dominant Windows operating system to stymie competition and promote its video and media player.

If found guilty, Microsoft could have to reveal more of the code underlying its software, as well as a $3bn fine.

The company has denied the claims and is hopeful an agreement can be reached.

"We've come to Brussels not only to discuss the issues, but to work things out,'' said Brad Smith, general counsel for Microsoft.

Windows code

Sun Microsystems and RealNetworks, which are giving evidence to the three-day hearing on Friday, may not be so keen to meet half-way.

The companies are calling for Microsoft to disclose more of its code so they can produce programs which work better with Windows, used on about 90% of all PCs.

They say that by making it harder for other programs to dovetail with Windows, Microsoft is breaking competition rules.

Microsoft says changes would mean poorer products for consumers

Ed Black, head of the Computer and Communications Industry Association (CCIA) and an outspoken critic of Microsoft, dismissed the software maker's attempts at reconciliation and pressed regulators to take action.

He also alleged the Oregon-based company had intimidated critics into not testifying.

"Microsoft does pressure business partners and competitors to not come forward," Mr Black said.

"I know senior executives from many companies who talk to me on a regular basis... they regrettably say they wish they could be here but it's too dangerous to come."

The EU's case centres on two principal arguments.

First, it contends that by including a media player in the Windows package, Microsoft unfairly promotes the product at the expense of rivals.

Second, it says, Microsoft wants to dominate the low-end server market by leveraging its leading position in personal computers.

Servers are large computers which provide core services to PCs in corporate networks, or furnish services via the internet.

To level the playing field, the European Commission wants Microsoft to either offer a version of Windows without the media player attached, or offer rival services within the package.

It also wants Microsoft to disclose more code to its competitors, allowing them to dovetail the different systems.