I think it's a double-encoding error. Text was encoded into utf-8, whose bytes got misinterpreted as codepoints, and encoded again. ü in utf-8 is (c3 bc), and U+00c3, U+00bc are Ã, ¼ respectively.
FTA: “When ETH Zürich started its own computer science program in the 60s, buying computers from the US turned out to be a bit of an issue. They were expensive and often unsuitable for European use (what with our strange umlauts and stubborn insistence on speaking languages different from English)”
I guess they started buying computers from the US :-)