Microsoft's share of the browser market is off sharply as new rivals emerge and a bevy of gadgets that provide access to the Web from beyond the PC flourishes. That raises big questions about what's really behind the EU's move to force Redmond to make room for Explorer alternatives on Windows under threat of seven-figure fines.Microsoft and the European Union reached an accord Wednesday under which the software maker will provide computer users on the continent with a choice of browsers to run on Windows through a so-called "ballot screen" that will pop up upon system start up.

Microsoft typically configures Explorer as the default browser for Windows. But if a trial period passes muster, Microsoft will be bound the agreement's terms for the next five years.

The deal is meant to settle claims that Microsoft's bundling of Explorer with Windows stifles competition in browsers and creates an unfair playing field for the likes of Google and Mozilla. But the most recent data shows those organizations and others making big headway against Microsoft--without help from regulators.

Internet Explorer's share of the worldwide browser market has fallen 16% since the beginning of last year, from 78.2% to 65.7%, according to figures I dug up from Net Applications' Web site. At one time, Redmond controlled more than 90% of the market.

Meanwhile, Microsoft's rivals are enjoying impressive gains. The Mozilla Foundation's open source Firefox browser has seen its market share jump by half, to 23.8%, since January of 2008. Mozilla's release of the highly anticipated Firefox 3.6, code-named Namoroko, next month should further boost Firefox's share.

Apples' Safari is also on the hunt, though from a more modest starting point. Safari's share stood at 4.2% as of September, up from 2.6% in January 2008. Not surprisingly, Safari's rise mirrors the growth of Mac sales in recent months and the iPhone's continued dominance in the mobile space.

Chrome, barely a gleam in Google's eyes two years ago, has seen its share more than double in the past nine months. Chrome stood at 3.2% in September, up from 1.5% in January, 2009. Dell's apparent intention to market an Android-powered mobile device will likely give Google an even bigger chunk in the months ahead.

Despite it all, the EU, via the European Commission, continues to see Microsoft as a big bad browser monopolist that must be constrained through regulation. Here's what it said Wednesday:

"The Commissions' concern has been that PC users should have an effective and unbiased choice between Internet Explorer and competing Web browsers to ensure competition on the merits and to allow consumers to benefit from technical developments and innovation both on the Web browser market an on related markets, such a Web based applications."

Europe's insistence that Microsoft still has a stranglehold over the market despite strong evidence to the contrary raises questions about whether authorities there are making policy based on market data, or on an image of Microsoft that ignores profound changes to the competitive landscape and the company's own behavior. It also suggests the EU's animus toward Redmond has become institutionalized within the organization.

It's no secret Microsoft and Europe's trustbusters have butted heads numerous times, and EU competition czar Neelie Kroes has called the company out on many occasions for a laundry list of offenses-some legitimate, others not so much.

Last year, Europe hit the company with a record $1.35 billion antitrust fine, claiming Microsoft failed to make available to rivals documentation needed to create products that can interoperate with Windows. The campaign against Microsoft became so extreme that former U.S. antitrust chief Thomas Barnett broke with diplomatic norms in 2007 and openly criticized the fines as "chilling," prompting and immediate rebuke from Kroes.

Whether the EU's concerns are warranted or not, the extent to which it can dictate market share through regulation is questionable. Worried about a supposed lack of competition in the media applications market, the Commission once ordered Microsoft to produce a version of Windows stripped of Windows Media Player.

That version, Windows Vista N, languished in stores and PC builders' warehouses as European consumers opted for full-featured versions of the operating system.

Demand for browsers must similarly follow a curve shaped by the virtues of the products on offer, and not by the EU's attempt to apportion market share based on outdated numbers, personal grudges, a late Beaujolais season or other irrelevant factors.