Print - An Analysis and Opinion of the Microsoft Antitrust Settlement

As I reported last week, Microsoft announced Friday that it had reached a settlement with the US government in its 3-year antitrust case. If the judge overseeing the case approves it, the settlement will have sweeping ramifications in the computer industry and beyond. But the big question is whether the settlement effectively punishes Microsoft for its illegal activities and prevents it from continuing such activities in the future. I think the settlement fails miserably on the first of these two qualifications, although it appears to satisfy the second. But, as with Microsoft's 1995 consent decree, the text of this settlement--the so-called Final Judgment--contains language that gives the company some wiggle room in the future. The settlement is a travesty of justice that leaves an illegal monopoly in a position of power, enabling Microsoft to continue harming competitors, partners, and even customers.

Before I review the settlement, however, I'd like to present some background information. As a technical reporter who has covered Microsoft professionally for more than half a decade, I've had a difficult time understanding the company. Microsoft is full of intelligent, enthusiastic, and driven people, many of whom literally believe that they can change the world through the company's products. It's a paradox to me that the people who make up Microsoft are responsible for one of the most predatory entities that has ever entered the world economy. Furthermore, Microsoft is responsible for some of the most unreliable and buggy technology ever foisted on consumers, and Microsoft has prevented other companies with more elegant technology from being successful again and again over the course of its 25-year history.

Some of its products--Windows 2000 and Windows XP, for example--are world-class, however. It's difficult to reconcile the actions of the predatory corporate giant with the people I know at Microsoft and the occasionally excellent products the company makes.

In the end, of course, it doesn't matter how any of us feel about the company. The historical record will show that the courts found Microsoft guilty of illegally gaining and maintaining a monopoly for PC OSs. The government presented a lot of evidence in court to bolster this argument, and I'd add that far more evidence is available to back it up even further. A fact's a fact: Microsoft dominates the industry.

After an initial round of appeals, Judge Colleen Kollar-Kotelly directed Microsoft and its foes in the Department of Justice (DOJ) to fashion a settlement. If a settlement wasn't reached by last Friday, she said, Microsoft would face the music in court next spring. And Kollar-Kotelly warned Microsoft that her own judgment wouldn't be particularly kind to the company. Other than a Microsoft breakup, which the government had previously ruled out, Kollar-Kotelly told the company to expect the strictest possible remedy.

Microsoft and the government met and held meetings around the clock but were unable to reach an agreement. So the court appointed a mediator, who worked with the two sides to establish an acceptable settlement. Last Friday, the two groups presented this settlement to Kollar-Kotelly, who will wait to accept the deal until she receives input from the US states that are also allied against Microsoft. In the meantime, Microsoft and its competitors weighed in on the terms of the deal.

"While the settlement goes further than we might have wanted, we believe that settling this case now is the right thing to do to help the industry, and the economy, to move forward," said Microsoft Chairman and Chief Software Architect Bill Gates. "We recognize that the success of our products has created concerns. This settlement addresses those concerns in a fair and reasonable manner, while still enabling Microsoft to continue innovating and pushing technology forward."

Others weren't so sure. "This [settlement] is a reward, not a remedy," said RealNetworks General Counsel Kelly Jo MacArthur in a statement. "This agreement allows a declared illegal monopolist to determine, at its sole discretion, what goes into the monopoly [OS] in the future."

So where's the truth in all this? You have to look closely at the settlement to find out. Like most legal documents, the proposed final settlement is chock-full of obtuse language, extended background information, and even a glossary that defines relevant technical terms. The important parts, however, concern how the settlement will curtail Microsoft's predatory conduct.

First, Microsoft can't retaliate against its own partners--PC makers, in this case--if any of these companies decides to promote, use, or sell non-Microsoft software or sell PCs that dual-boot Windows and a competing OS. This agreement comes too late to save tiny Be Inc., which had sought to install its Be OS in dual-boot scenarios with PC makers; because of their restrictive Windows contracts, the major PC makers didn't sign on, and Palm, which recently bought Be Inc., has no plans to continue development of the Be OS. It's also too late to save Netscape, which AOL swallowed up after Netscape was unable to compete with Microsoft's bundled Internet Explorer (IE) product.

Microsoft must offer all PC makers a uniform price for Windows and not reward noncompetitive partners (e.g., Dell) with better deals while punishing other companies (e.g., IBM) with higher prices, as the company has in the past. However, Microsoft is free to offer volume discounts based solely on sales. This part of the agreement is fair but does nothing to compensate the companies that Microsoft's favoritism damaged in the past. During the original trial, for example, IBM stated on record that it lost millions of dollars because of Microsoft's refusal to supply a Windows 95 license in a timely manner because IBM sold Lotus products that competed with Microsoft Office.

The settlement agreement lets PC makers modify Windows display icons, Start Menu entries, and other onscreen elements for products that compete with the bundled products Microsoft supplies in Windows. For example, PC makers can now replace Windows Media Player (WMP) icons with RealNetworks RealPlayer or Apple QuickTime icons. The caveat is that such replacements must not harm the UI's operation, which leads me to believe that in the future Microsoft will integrate product bundlings even more tightly into Windows than they are today. In the meantime, Netscape, RealNetworks, Apple, and many other companies have felt the sting of Microsoft's product-bundling strategy as their products have fallen in use: It's easier to use a program that's built in than it is to download an alternative from the Internet. For many competitors, this change comes too late.

Sometime during the next year, Microsoft will release new documentation to PC makers and other partners that clearly explains how to better integrate third-party products with Windows. In the past, Microsoft withheld this crucial information from companies that threatened its core platforms. In addition, Microsoft will release the information programmers need to access all client and server protocols and interfaces in Windows so that third-party applications and services can better integrate with Windows. A major facet of Sun Microsystems' complaint against Microsoft--a complaint that touched off Microsoft's European antitrust investigation, incidentally--regarded the withholding of such information. Again, this action comes too late to help the companies that struggled against the many bundled products and services in Windows.

I'll present the next condition in the exact wording of the Final Judgment; pay attention to the word "except," because the repeated use of this word in this document buys Microsoft room to bargain in the future: "Microsoft shall not enter into any agreement relating to a Windows Operating System Product that conditions the grant of any Consideration on an ISV's refraining from developing, using, distributing, or promoting any software that competes with Microsoft Platform Software or any software that runs on any software that competes with Microsoft Platform Software, except that Microsoft may enter into agreements that place limitations on an ISV's development, use, distribution or promotion of any such software if those limitations are reasonably necessary to and of reasonable scope and duration in relation to a bona fide contractual obligation of the ISV to use, distribute or promote any Microsoft software, or to develop software for, or in conjunction with, Microsoft." Yikes. You can imagine the contractual language wrangling that will accompany any future deals of this nature. The wiggle room is obvious.

Some interesting changes are also ahead for end users. Sometime during the next year, Microsoft will ship a downloadable update for XP (but not, notably, for any Windows 9x product) that will let both users and PC makers enable or remove access to IE, MSN Explorer, Outlook Express, Windows Messenger, WMP, and other related technologies by using a desktop icon, a Start Menu entry, or the Add or Remove Programs applet. In addition, end users and PC makers can designate competing products as replacements for Microsoft's bundled products. So, for example, you might designate Netscape or AOL as the default Web browser and RealPlayer as the media player. This language does nothing to reverse the years of Windows product bundling and the irreversible damage that bundling caused to competition.

Because of Microsoft's less-than-honorable approach to complying with its 1995 consent decree, the Final Judgment also includes a section about compliance, which specifies how Microsoft will be forced to stay in line going forward. For the next 5 years, a three-person Technical Committee (TC) will monitor Microsoft to ensure that the company complies with the terms of the settlement. Again, this action is acceptable for future behavior, but it does nothing to address the previous behavior that resulted in Microsoft's market dominance.

And if it's not obvious by now, the major failing of this settlement is that it doesn't punish Microsoft for breaking the law but instead prevents the company from continuing the behavior that got it into trouble. The list of prohibited conduct spells out, in very general terms, exactly what the company did wrong in the past. But preventing similar crimes in the future isn't "justice." Imagine a court letting a convicted thief keep the items he stole if only he promises never to steal again. That's the "justice" this settlement foists on the people of America and the world. True justice addresses the people the crime hurts--in this case, Microsoft's competitors, partners, and users--and punishes those who commit the crime. This settlement lets Microsoft retain its illegally gained market power, along with most of the advantages that come along with that dominance.

RealNetworks' MacArthur is right. This agreement isn't a remedy--it's a reward.

I agree, it sounds like little more than a wrist-slap to me. However - now Microsoft must face the Court of Public (and Corporate) Opinion, where the verdict is still uncertain. I have a feeling that the next twelve months will be the making or breaking of Microsoft...

Please... I don't thinks this is a slap on the wrist. Microsoft has not broken any laws. I think if they stay in the courts they would eventually win this case. Judge Jackson is an idiot so I personally think his judgement would eventually have been overturned. Mark my word, if the states continue the crap they will end up just losing more money because MS broke no laws.

Well, Paul, now we know how you really feel about Microsoft. Of course, this begs the question. Why write about a company and its products in a magazine devoted to it and its enthusiasts when you think so little of it and want it to be punished? Perhaps, Linux Today would better suit you. There, Microsoft diatribes abound. You should feel right at home. Meanwhile, the DOJ vs. Microsoft trial was, in my opinion, a travesty of justice foisted upon the American people by its competitors. Those same competitors, who have every resource available to them, can hardly be said to have given us the Holy Grail of computing in the last three years. To the contrary, everyone of them has done little to further computer science. Now, with this trial in the dust bin of history, they will now have to compete. However, I wouldn't bet money on them. Microsoft will produce better products at lower prices like it has always done and crush the competition. There is nothing anti-competitive about that. And the benefits to the consumer, as in the past, will prove to be enormous. Thank you.

Paul, are you feeling okay? Are you actually admitting that Microsoft is an illegal monopoly and makes crap products? For once, I completely agree with you. This 'remedy' has more holes in it than Outlook Express. It doesn't even attempt to punish Microsoft, just prevent them from doing the same thing again (and it does that badly). I would expect fines, compensation and public apologies to be in any settlement but there isn't any. Although the deal says that Microsoft can't discriminate against PC manufacturers if they choose to go with rival software, it only lasts for five years. So after five years, what's to stop them saying, "Well, Dell, you were good and stayed with MS software, you can have Windows cheap. But IBM, you went with rival software. We couldn't do anything about that then but now we're going to double your Windows prices."? You say, "Imagine a convicted thief allowed to keep the items he stole, if only he promises never to steal again". Well, it's worse than that. The thief only has to promise not to steal for five years. And even if he does, all that happens is that he's not allowed to steal for another two. This deal doesn't level the playing field. Not even close. All it does is slightly restrict Microsoft's huge (and illegally gained and maintained) advantage for five years. They'll still be way in front of anyone else in terms of their dominance and ability to leaverage their monopoly. Paul - I'd be interested to know, what would be your ideal solution?

Paul: You miss the point. A settlement is not a remedy. It's an agreement. A compromise. If they don't settle you should expect this case still alive at least 2003. By that time Windows XP will have sold millions of copies and MS dominance will be greater. Both parts have to make concessions. MS has it. The Doj has it. Game over.

I think your analysis fails to convey the complicated nature of anti-trust in general and this case in particular. To compare this to a common theif distorts more than it clarifies. What Microsoft did only becomes criminal when and if they become a monopoly - a gray line which was never official until the Court's ruling, and of course subject to review after that. In addition, this case was not for Microsoft's competitors- at least it should not have been. This case was supposed to benefit consumers. Which also brings us to the complicated nature of this antiTrust situation. Since the Sherman law was written there have been many analysis done of the situation, and the thoughts on it are divergent as to how it should work. There are certain kinds of monopolies that are obvious- utility companies, telephone lines, and things that are decreed by gov't. With everything else, it is much more complicated. One of the interesting things about this case was that it should have focused on the network effect - the effect that a product becomes more valuable when other people use it naturally leading to 'monopolies' or at least preponderance of market share. Unfortunately it was not addressed. A better analogy for this situation would be a company that enhanced cars- Imagine that they converted 2-wheel drive cars to 4-wheel drive, and also converted regular cars to convertibles. Also imagine that they did it for cars made by a company that owned close to %90 of the market (unrealistic now, but I am sure this was not unrealistic80 years ago). If that car company started to offer models with 4 wheel drive and convertibles, what should the government do about it?

The court of public opinion has long ago made up its mind. That is why, except for comments from typically cranky and anti Microsoft IT personnel, you never hear about results from any wide-ranging poll of true, average PC users. The reason is because it would not bode well for those trying to destroy a valuable American resource. These ridiculous trustbusters already know that most average PC users have no real beef against MS, that they have found that MS software does the job just fine, that they like having more features at their fingertips, and that most people view this antitrust case as what it really is: purely anti-business and anti-consumer as inflicted on a successful company by Clinton and his cronies. The only outcry through all this has been from the same incompetent tech companies unwilling to compete. There has been none of that with any great significance from the public at large because to them, it is a non-issue. If anything proves that consumers have not been hurt, it is that complete and utter lack of any real consumer outcry. I say, when the 18 state DAs get off their high horses and realize what money-wasting fools they are, then maybe we can move forward with the settlement and get on with serious business. But I have little faith in lawyers and no doubt they will drag this out on behalf of their multi-millionaire corporate clients with little consideration for the economy or the consumer.

This is my first time posting to this site. I think that this is a very interesting article, where the author shows integrity in journalism, based on the number of years and close look that he had had. Some people though, ignore, or simple do not know of the past, companies like Stacker, Borland, Lattice, Spyglass, Netscape, 3Com, FoxPro(?), among others, that at a given time have been affected by MS monopolistic tactics. If you know the past, you cannot ignore it, regardless whether you like their products, the company success, the company determination and its people. Personally, I cannot lie to myself and say that Internet Explorer has always been the best web browser and it became the most popular because it was best, no, cannot lie. I know, because I was there, Netscape was the best web browser, when MS did not even have a plan for the internet and was trying to get the consumers into a private MSN. It was not until, version 4 that it became comparable to Netscape. In the process, they used Spyglass technology and told them that they were going to pay them a royalty for the sale of IE, but guess what, they gave it for free so Spyglass did not get anything until they sued. Their behavior cannot be ignored. Actually, it can be done. I used to ignore it since I supported them and indirectly promoted their products. Back in 1998, I used to laugh and say wow, they are really smart, see what they did to Netscape, and others and they can get away with it. I also thought that business was separate from politics and that the goverment should not do anything. I have recently changed my opinion, I still think that NT is a good OS, and that W2000 is even better. However, I do not like the practices of the company, and have decided to look into other OSs (Linux). In any case, I learned UNIX in late 80's and on PC Borland tools were the best and later the first releases the Windows were still toys, so it is an easy transition for me. Even though I am not a lawyer, I would like to include here a link to the USDOJ web site. Antitrust Division Manual: http://www.usdoj.gov/atr/foia/divisionmanual/ch2.htm Check where it says: "Monopolizing trade a felony; penalty" I prefer to think that the leveling of the Free Market will happen by natural forces, the IT people, then the consumers, will know that they have more choices and that we are free to go anywhere. Then when this change happens, nobody could say that it happened because the goverment forced it ... Actually, this change has already started. -TSK

Wow! The Astroturf is really flying in the wake of this article. Almost up to the standard of ZDNet's Talkback forums. To those who are STILL crying out that 'Microsoft has done no wrong' and that it's all a DIABOLICAL CONSPIRACY to punish Bill Gates, don't forget to keep flapping your arms, or you'll be falling out of Cloud Cuckoo Land in no time! As I said before, the buying public will soo weigh in with their verdict on Microsoft, and I'd bet the result ain't pretty... Alan.

>>Some people though, ignore, or simple do not know of the past, companies like Stacker, Borland, Lattice, Spyglass, Netscape, 3Com, FoxPro(?), among others, that at a given time have been affected by MS monopolistic tactics.<< So - if someone competes and wins away market share from another company, or that company folds, the victor is monopolistic? Can I stop laughing now? Businesses go under by the droves each year. How come Arbys or other now defunct fast food chains haven't sued McDonalds or Burger King? It is business and business says that you have to compete, you don't go crying to the government and, unfortunately, most businesses won't make it past the first year. Consolidation and standardization is needed in all industries and it is no ones fault that other companies can't keep up and fall away - that is the nature of business. >>If you know the past, you cannot ignore it, regardless whether you like their products, the company success, the company determination and its people.<< Sure, let's now sue the victors of the VHS/Beta Wars, or CompUSA (Is there any other major PC chain around?), or Barnes & Nobels who have put many a book store/chain out of business. The point is, that is what business is and not everyone can, nor has the right, to survive. I don't feel sorry for any of the companies you mention nor do I think MS should worry about them either. >>Personally, I cannot lie to myself and say that Internet Explorer has always been the best web browser and it became the most popular because it was best, no, cannot lie. I know, because I was there, Netscape was the best web browser, when MS did not even have a plan for the internet and was trying to get the consumers into a private MSN.<< That is called R & D. No one expects anything, especially when caught off guard about the Internet as MS was, to be the best at the start. But they did their work and now they are the best - so what's your point? I just think anyone who bad mouths MS just doesn't like the way industries are run and develop over time. There is music and the arts for folks like you but otherwise, get you heads out of the sand and start learning about what competition is all about. Wake up peple. Don't let the FUD the PC press enjoys spreading confuse you or cloud the reality of what is simply American capitalism. The alternatives of what the old DOJ wanted to do would have been, and are, the things we should worry about. The day the government truly determines my computing experience is the day I no longer use a computer.

I have the urge to be a whiner, I’m in the mood to whine, and I would like to take this opportunity to whine… oh how much I want to whine…the world is not fair…my fortunes suck and I need to complain……I don't understand what exactly is preventing you or other people from installing a different operating system on your PC? It is wrong for someone in your position to go out there and spread this choice of words, as if everyone out there is naïve and needs your great advice. For your information and the additional readers out there believe it or not, on my Windows system in addition to IE and Media Player I am also running Netscape, Real player and other competitors programs. Get this “No one forced me” to run Windows, and believe it or not I could have installed Unix (chose your version, or vendor), Linux (choose your version, vendor, and GUI) , and why not buy a MAC or install OS/2. Hey, while we are complaining, why no go further and complain that Apple is too proprietary and suggest that they open their system to run Linux. Why!!!! Because I can….I believe that you do consumers a disfavor by claiming that they have no choices; they have the same options as you do, and if you are able to install and run your preferred OS or your system so does everyone else. You make it sound as the exclusive deals between the Microsoft and OEMs are unique in this industry, and for that I would suggest that you wake up. Does anyone complain about the GM trucks delivered with Good Year tires? I would like to hear those burger lovers request Pepsi in a McDonald shop or Coke in a Burger King shop. Are you still with me…. Companies come and go all the times and this transformation is no restricted just to the tech world and for you to blame their miss-fortunes on Microsoft is a bit foolish, and unfortunately it shows your bias. I too have been in this industry for just as long as you have if not longer, and I’ve seen the past but I like the future better. Please be fair….because the world sure is not. Sincerely, ln

An unrealistic article, an irrelevant settlement. Paul, this is a good but unrealistic article. How exactly are you going to "punish" Microsoft appropriately? Should it have to give large amounts of cash to all previous competitors, some of which are defunct? Yes, Microsoft did wrong, but there's no way to turn back the clock-- all you can do is try to do better moving forward. And where is the consumer in all of this? Microsoft's licensing changes of late have been far more of a problem for consumers and far stronger evidence of their monopoly than anything the government has zeroed in on. (More proof that the government can't do what's best for all of us in the technology world.) I'm not talking about WPA-- people should stop pirating and get over that-- I'm talking about the elimination of version upgrades for businesses, the continually rising prices, the subtle licensing changes that wind up costing big $, etc. I can already use RealPlayer if I want. Ditto for Netscape (not that I'd want to). I do use Opera. What's the point-- insuring that even people who aren't smart enough to use competing products can? The right to be stupid? Whatever. If for now other reason than I'm tired of the commentary on both sides and the farcical anti-trust search for justice that Microsoft's competitors are shouting for, I say amen to this irrelevant settlement.

I think this article is unduly harshly critical of Microsoft. I am a consumer of several products developed by Microsoft, to a large extent of which I am pleased. Microsoft is perfectly legit in its transactions...it's all about the power to innovate, market and win the game - that's what's called freedom. Let's stop all this bashing of Microsoft. If these other companies that go about the whole place crying like cry babies had any significantly better product against Microsoft's then I really like think consumers would have shifted.

Don't companies just hate it when someone is making too much money and they can't get a piece of it. I used to think that the purpose of a free economy was to be able to prosper to your fullest and achieve your fullest potential. Boy the government sure doesn't want you to think so does it? How anyone with any common sense or any clue about the technology industry can say Microsoft has a monopoly needs to break out a dictionary. For a company to be a monopoly there has to be a demand for a good or service and only be ONE supplier. For a quick proof that there is not a monopoly. Microsoft and Unix both develop Operating Systems. Well I be! Two companies right there. The fact that there are more suppliers than one means there isn't a monopoly. Anyone with a PC has a choice as to what type of OS they want to install. Why do more choose Windows, well let's see, it's better, it's easier to use. But people want to whine and say that it isn't fair. I don't recall Microsoft whining when it began about not getting help. They developed it. If Netscape and AOL are so concerned about Windows then have them take the time to develop a new operating system that blows Windows away. Why don't they? Who's stopping them? I guess Time-Warner/AOL don't have enough capital to expand it this field right?

All you people should listen to yourselves. Why in the Hell do you care that Sun Microsystems, Oracle, IBM, AOL/Time Warner, etc. were injured by Microsoft? We should all feel sorry for these multi-billion dollar companies? Give me a break! Do you realize how dumb you sound? (This is actually addressed to some of those who posted responses to this article, not the author. His story didn't even deserve to be read, much less commented on.) Are any of you aware how much more money IBM takes in each year than Microsoft does? When the Justice Department was after IBM years ago, I bet people were talking about how evil IBM was, just like they are about Microsoft now. So help me, if all you jealous, anti-Microsoft jerks keep this up and we all end up using Netscape Navigator on Linux, you will regret being so stupid. Navigator has/does/ever shall suck, and anyone who can't see that is just mental. And all flavors of Linux are about as usable as Windows 3.1 was. These are just a couple of examples of products that deserve to lose market share. News flash: I like Windows just the way it is (XP user here). I just hope that all the complaining does NOT cause a major change in the design of Windows, because I am not so foolish that I can't see a good thing when I've got it. So your complaining continues. I'm still waiting for all the complainers to start using Linux-OS/2-Solaris, etc. Wait, what is this? No takers? I thought not.

Paul, how dare you display independent thought and express an honest and reasoned commentary (even on this Windows-centric site) on what has to be one of the biggest "sell outs" in legal history. It appears that those MS defenders who are delusional and living in a state of denial cannot accept reality. The DOJ WON the trial, MS was found guilty yet this capitulation by the DOJ would have you think Microsoft won hands down. What a sweet heart deal! No wonder Gates was all smiles with his perfunctory and insincere "Aw shucks, I guess we can live with it."... snicker, snicker, nudge, nudge, wink, wink... kind of makes a Monty Python plot look tame and rational in comparison. When does anyone brought to trial get to make a deal and escape punishment AFTER they have been found guilty? When does anyone found guilty get to escape punishment and is in fact rewarded for past transgressions and for future actions and "spoils"? When does anyone get to write up their own "settlement" (as it appears Gates/Microsoft has done) only to be accepted and signed off by a corrupt and politically influenced DOJ? Most of the MS apologists refuse to accept the trial and verdict... too bad, that's the law as it now stands and MS was found guilty, originally and on appeal. What part of incriminating MS e-mails, conflicting testimony, perjury/phony evidence, predatory behaviour, etc do MS apologists not understand? Cutting off Netscape’s air supply, demanding Apple knife the Quicktime baby and Office cancellation threats if Apple dared supply Netscape along with Explorer, admitting Explorer was inferior (at the time) to Netscape so having to use the ubiquity of Windows to "force" Explorer on consumers (the phony tying ploy another issue), threatening OEMs if they didn't fall into line... all excused by those who suck at the teat of Gates/Microsoft. "... just jealous of Gates..."; "... others can't compete... so they whine..."; etc and the biggest whopper "... Microsoft innovates..." completely wipe out any credibility MS defenders might have had. MS is the one who cannot win on merit so must resort to underhanded and illegal methods as has been proven time and time again. Thank you Paul for telling it like it is, exposing this "deal" for the sham it really is and not pandering to the mindless Gates and Windows devotees who see no farther than their bank accounts.

Paul, Your observations and points regarding the Microsoft Antitrust Settlement are right on the mark, -with one small exception -your choice of the word "bundled". You wrote "..Netscape was unable to compete with Microsoft's bundled Internet Explorer (IE) product." Personnally, I think "integrated" would be more accurate, since users almost always have the choice to install or remove "bundled" software. With Internet Explorer we didn't have that luxury. As a final comment, I originally was using Netscape Navigator 4.78 while browsing your article, but was unable to post a comment (I tried several times but kept getting a blank java window) and had to finally resort to using I.E. 5.5 -NOW THAT'S IRONIC!

Ah yes – the same old party line and it is getting very tired indeed. People like Paul and Joe Scozzaro are the ones who are being anything but independent. These Clinton Administration apologists spew the same garbage day in and day out and clearly have not really sat down to think about what they write. Before I continue, let me get some definitions out of the way and I will come back to them: Monopoly: Exclusive control by one group of the means of producing or selling a commodity or service. A company or group having exclusive control over a commercial activity. A commodity or service so controlled. Innovation: The act of introducing something new. Something newly introduced. Now, if I am not mistaken, one of the primary points of this case, and a point still rallied around by the remaining state holdouts, is that Microsoft did harm to consumers. OK, lets see some of the “consumers” Mr. Scozzaro mentioned as being harmed: Apple & Netscape. (I’ll wait until the laughter dies down). The fact is that no one, from the DOJ to the States to anyone else, for that matter, has ever come up with one shred of evidence to show that Microsoft has harmed consumers in any way. And don’t talk to me about price – Windows has not risen in price for many years – try finding just about any other product that hasn’t raised its price in that time. Hell, version upgrades to most image editing and video editing software cost more than Windows and we aren’t even talking about the OS, but simply a separate app. Saying that MS was found guilty is really a moot point – the original trial was the greatest scam ever foisted on the taxpayer. They spent all that money and they never proved any harm to consumers. And they never proved any exclusive control over the OS or browser market – they couldn’t with all the choices available. So whether one agrees with the verdict is very important here because the verdict displays the effects of politics and lobbying far more than any real wrongdoing by Microsoft. What’s more, how Microsoft can even be considered a monopoly based on the definition is truly amazing. Microsoft never had, nor does it have, exclusive control over any area in which it develops software. But Apple and Netscape and AOL and Sun, etc. say they do. So how, then, do they explain their continued existence? No, Mr. Scozzaro, there is no monopoly here. In fact, the only thing Microsoft is guilty of is a small group of people and companies who would like to see a great success story destroyed; all Microsoft is guilty of is having competitors in business who don’t know how to compete nor do they want to. Well, if you can’t play hardball, which is all Microsoft has done, then you don’t deserve to be in business, let alone waste taxpayer money by trying to find someone else to compete for you. The fact is that negotiations & discussions about punishment do go on all the time, contrary to Mr. Scozzaro’s contention. This settlement is just another example of this, as misguided as the original verdict may have been. But let’s not forget Mr. Scozzaro’s key points demonstrating Microsoft’s evil ways: Cutting off Netscape’s air supply: Netscape eventually went free, why didn’t it do so to begin with? And if I am using Netscape, upgrade my OS, and another browser is now integrated, I am going to just re-install my desired browser. No, what you are talking about here is poor business judgment and some lazy consumers – nothing illegal about that. Demanding Apple knife the QuickTime baby and Office cancellation threats if Apple dared supply Netscape along with Explorer: Last time I checked, QuickTime is still going strong and has for some time, now at v5. And there is nothing wrong with making business deals. If Apple did not care for any deals regarding Office, they had other alternatives to consider. Or they could have continued to negotiate the deal from the perspective that if MS doesn’t concede in this area, Apple, not using Office, would put a dent in Microsoft’s cash cow. Nope, again, this only demonstrates faulty business sense. Or perhaps it shows that, unlike prosecutors in this case, Apple was thinking of its consumer base, as most of those consumers want Office. However, if anything, this just shows the weakness that has always been Apple; when they should have played hardball, they didn’t. Admitting Explorer was inferior (at the time) to Netscape so having to use the ubiquity of Windows to "force" Explorer on consumers: They were giving the software away as a download at first – no integration at all – do you understand that? And as the Internet became more ubiquitous, the integrating of browser technology to take advantage of the change in how people use their PC was very smart and much needed. And it wasn’t even until v3 of IE when it was truly tied to the OS and v3 really was when IE came into its own as a very viable browser anyway. At the risk of belaboring a point, if you are using one piece of software and blindly change because you have a new OS that integrates that technology, then you are just lazy. Your being lazy is not the fault of the vendor. So install your favorite app and use it. Again, as with companies who are just too lazy to compete, it reflects on the “user” and not Microsoft. No one forces me to change the software I use. I still use Norton Utilities this very day as I would never consider the defrag utility with Windows. People have to make their own intelligent choices about what is best for them. And there is enough press and advertising out there if people are serious and want to do their homework. Yet we have those who say that either everything should be thrown at the customer up front to choose from (yeah, you be the one to sort out that mess), or provide no standard system at all forcing the user to pick from scratch (ditto). These are ideas firmly entrenched in the absurd. Threatening OEMs if they didn't fall into line: Can you say OS/2, Linux, Mac, Unix, BeOS, etc. etc.? And why not look elsewhere if they felt they were being bullied? You can say they were threatened, but it is far more likely that again, they knew what their consumers wanted and negotiated, perhaps somewhat timidly, on that basis. The fact that Dell has now given up Linux on their desktop PCs, the fact that year to year, consumer desire for Linux on the desktop hardly registers on the scale, says more about what consumers want than anything else. And don’t say we are sheep. This whole idea of users being sheep, needing protection from themselves, is insulting and naïve. We need no one telling us what to use, the government included. The marketplace will take care of itself. By the way – the definition for innovation refers to the word “new,” not “original.” Of course devotees of other OS’s, one in particular, are reticent to truly define the term, “innovation,” or otherwise they’d still have to be bowing to Xerox to this day. But Microsoft is innovative in how they adapt to consumer demands. They are extremely innovative in how they take existing products and make them better. The job they did with Front Page, taking a nothing web tool and making it the best WYSIWYG web creation app for beginning and intermediate users, is just one very good example. If original were the definition of innovative, then that word could not be applied to many of those today who are defined by it Well, it comes down to this. The only thing shown by this case is how ineffectual may business strategies in the tech sector are. It shows how some in government only know how to obfuscate when real examples of the issues they claim exist are not forthcoming. It shows just how much a case like this hurts the economy and hurts the consumer. People like Paul and Mr. Scozzaro have nothing to base their assertions on, so they continue to spread FUD, insults, and whine about a company that understands what business and industry and consumerism mean. Until people stop applying this perverted socialist 60s notion to the tech industry, that everything should be free for anyone to do with as they please, then cases harmful to business and consumers, like this one, will continue waste our money and our time.

So little spa... so much to refute. Lar... I did think about what I wrote and thanks for confirming many of my points. (I'll admit up front that I use and prefer a Macintosh as my computer of choice) ... Making the red-herring political accusation (I’m Canadian so Clinton/Democrat ties are irrelevant and do not apply); you’ve used the expected “they’re just whiners and lazy and can’t compete” excuse; and, since you avoided the point, is it safe to assume you do indeed suck at the Microsoft financial teat (MS employee, Windows developer, MS stockholder, paid shill, etc) and do not want to see the goose that lays your golden egg cooked? What price ethics??? Politically motivated or not, the original case as presented was found to have merit in a court of law and was unanimously upheld on appeal. MS was found guilty and should only have been awaiting a just sentence. If there is any politicizing involved, it was in the sham of a settlement drafted by Gates himself and casually signed off by the DOJ. Where are all the remedies and benefits in this agreement that the DOJ spokesman alluded to? Finer minds than you or I have picked the deal apart and found it sadly lacking in remedy or punishment (as per Paul's article, this seems a reward rather than a punishment). Are you suggesting no charges should ever be brought to bear if a crime is perceived to have been committed but the accuser/witness is deemed "hostile" (political adversary, competitor, etc) to the accused? Use all the definitions you like or can find that support your MS views, but your “monopoly” is apparently not the one used for anti-trust issues. Play word games all you want but MS was found to be a predatory monopolist by its actions and by the legal definition of the word, your preferred definition not withstanding. Being a monopoly isn't a crime but the rules change as to how you conduct business and MS broke those rules AS THE LAW PRESENTLY EXISTS. $ of Windows... While the price of computer hardware has fallen dramatically, the relative price of Windows has remained the same and is a greater percentage of the purchase price of a typical computer. Could this be because there is no real competition re the desktop OS? It's become even worse with the forced "upgrade now or pay thru the nose" path to XP (I can hear the "no one forces you to do anything" rebuttal now). If you want to continue using your Windows-based hardware and software, you are in effect being forced, unless you want to convert your investment into an expensive doorstop. Consumer harm... all in the eye of the beholder. MS has used heavy-handed tactics to keep competitor software off computers. MS only provides the OS so where do they get off threatening OEMs if they dare to add extra value to THEIR machines? (ie, include Netscape, Apple, etc) It speaks volumes that MS products cannot stand on their own merit and compete on a level playing field and MS needs to prevent consumers from seeing and experiencing other comparable apps. Sure, the average consumer is lazy and Microsoft knows it, counts on it and plays to this fact. That's the reason it ties everything it can into the OS knowing if it's good enough, Ma & Pa computer user, the vast majority, are going to use what's already there. They are not technically oriented and will not "mess" with their machine. Or they'll decide it's not worth it to download a 10 or 20 MB competitors app (even if they did know how to install it), especially over the typically slow phone connection a majority of users have and more so if they have to pay extra. MS knows this and it may be deemed a good business attack but it doesn't excuse MS from deliberately excluding similar apps on hardware they seem to control but shouldn't. If MS wants to have hardware and software control (a la Apple), then let it build its own computer... wait, they have in the XBox! Let's see what Dell et al do when the XBox starts becoming more the personal computer it's built around than a gaming machine. MS can afford another loss-leader (it already will be) and will no doubt cut off their air supply too. Then we'll hear "whining". If choice inconveniences or costs the consumer, doesn't that show harm? If the computing experience is being lessened by MS tactics (keeping other superior apps off computers, "sabotaging" competitors apps, using/hijacking cross-platform technologies ie Java, etc.), explain how this benefits consumers? What is your criteria for consumer benefit... it's free and already installed? Pretty narrow and self serving if it is. MS only gives away apps to put other out of business, not because its apps are necessarily better. Sounds like an obvious business plan but it doesn't need to be that way. Not "let's build a better product and it will sell/win" but "let's kill the competition, superior product or not"... the Gates win-at-all-cost, I-must-control-the-world mindset. In some places (like the U.S.) and depending on the circumstances, that's considered to be illegal. Surely apps development must cost MS something even though most MS "innovation" is originally ripped off from others thus lowering its R&D costs. How are competitors lazy? In many cases they have superior technologies/apps but are not allowed on the average computer due to MS threats to OEMs. Note how MS faked some concessions on the desktop until AOL arranged to include its icon on the WinXP desktop... MS suddenly went back to their old ways and demanded OEMS cave to its desktop demands. What is wrong with letting OEMs choose what's on THEIR computers... MS, Netscape, Apple, Quicken or otherwise? What's MS afraid of... true and honest competition? If tying is so great, why doesn't MS intermingle Office into Windows? Perhaps MS enjoys its monopoly in the office suite arena and it brings in too much money to help offset all those free apps it magnanimously gives away. Negotiations... usually occur BEFORE a trial, not after a verdict has been reached and sentencing is due. "Gee judge, I've been found guilty as sin, now let's sit down, sham a negotiation and I'LL tell YOU my "punishment"." ROFL. Netscape... had to make money so originally charged for their product and only went free to try to compete with the free and included Explorer. What poor business decision? Needing to make money to survive? Not being allowed on computers due to MS threats to OEMs? MS using one monopoly (legal definition, not your favourable trumped up one) on the desktop to gain another in browsers? Why would and how could MS give away an app that must have cost millions to develop, even though your hero, the great innovator Bill Gates, missed the Internet train and had to scramble to buy existing Internet technology? Couldn't be to simply put Netscape under could it? Basically accomplished as Netscape has only just survived after being bought by AOL. Apple... IMO, (my Mac bias showing) Quicktime is superior and much more versatile in many ways to its competitors but is third after Real and WinMedia, in part thanks to MS not allowing QT on OEM computers. Why... can MS not compete or does it want to push only proprietary MS technology? MS wants total control over multimedia (and computing in general) on Windows so it demands Apple kill QT (on Windows). It threatened Compaq when it dared to want to include QT (and also Netscape) on its machines... MS-"We'll have none of that competitive/superior technology on YOUR machines!" QT gets no automatic exposure similar to MS apps tied to Windows so less usage (though QT is often the preferred choice of video and multimedia pros in the know... go figure). Note how a recent service pack for Explorer 5 (sp2?) quietly and sneakily dropped plugin support, surprising and angering many unsuspecting users who could no longer view Quicktime files and others reliant on plugins. No consumer harm, inconvenience or disruption there. What other alternatives to Office is there since to keep the Mac relevant, it needs to "communicate" with the de facto Office standard on Windows machines? What power does Apple have to negotiate to "put a dent in MS's cash cow"? All these loose, open-ended suggestions you've made with no realistic or legitimate answers. What real competition is there on the desktop? With over 90% saturation, what are OEMs going to install instead? OS/2 (MS hindered IBM by withholding a license renewal when IBM wanted to include OS/2 with Win95 on IBM machines). Linux (only for the technically oriented, a miniscule percentage of overall users). Mac (IMO, a superior all round solution suffering from MS BS, FUD and the MS copycat syndrome). Unix (powerful but only high-end and only for the technically oriented). BeOS (hardly any apps so unusable in the real world). These speciously suggested OS's cannot compete with the "snowball effect" that Windows now holds. Most businesses use Windows so workers figure it's required at home, friends and relatives jump on the bandwagon "everyone uses it so I have to also" and the monopoly becomes self perpetuating. (I'll grant you Apple's major mistake… allowing Gates to rip off the Mac interface and undercut with lower priced CPUs. I'll beat you to it... no Apple didn't "steal" the GUI from Xerox as you tried to cleverly allude to. Jobs toured Xerox, saw potential, licensed/paid for using some Xerox ideas and developed the Mac GUI that bears little resemblance to Xerox's work. Apple wasn't referred to as MS's "R&D South" during the late '80s & early '90s, and even to this day, for nothing.) Want to see where MS is going tomorrow?... look at Apple today. And lets drop the MS "innovation" mantra... knowledgeable people know it for the BS it is no matter what spin or definition you and other MS apologists try to put on it. MS literally "borrows" or buys everything it claims as original or innovative. Everything MS pushes as its own has a precursor or was existing and bought in order to immediately get into a market MS somehow missed. Hotmail, Visio, Word, Excel, Powerpoint, Explorer, ad nauseam and even your admittedly bought FrontPage. Contrary to your MS spin, FrontPage was one of the first successful WYSIWYG HTML editors out there and was exclusively Mac. That is until MS bought out Vermeer, sloppily updating a version for the Mac while converting it to a now exclusively Windows app which, of course, throws in all sorts of MS proprietary code and extraneous garbage. Perhaps it was only "nothing" as you suggest because it wasn't on Windows... typical MS/Windows arrogance. I guess it was "nothing" enough to attract MS's attention when they decided to buy it. Cleartype (?) in XP based on '70's Apple technology used on the Apple II; the newly touted Tablet, an oversized Newton (even the PocketPC being Newton/Palm ripoffs); MovieMaker, a poor iMovie wannabe hastily thrown into Win ME a year after iMovies intro (much like Video for Windows was a Quicktime copycat back in the early '90s); Gates discovers the "new" digital revolution long after Apple and others. Does the great visionary Gates still think no one will ever need more than 640Kb of memory or the Internet is still a passing fad or that broadband would be widely available and in use by now? Need I go on? MS innovation... BOB. There, I'll give you that one. Given the fact that MS cannot stand any competition, what chance is there for true innovation. Unless your plan is to simply cave into MS and sell out, what incentive is there to create the next great app or technology only to have MS Embrace, Extend, Extinguish, Exterminate, Buy it, whatever? How does the consumer benefit from stagnant technology? Witness the lack of any recent worthwhile improvements to Explorer after Netscape was basically wiped out. Only a few years ago, when there was true competition and whether it was good or bad, you couldn't keep up with changes as Netscape and MS kept leap-frogging each other with additions and enhancements to their browsers. Now, little or no competition... zilch in the way of enhancements or real improvements. Contrary to your conclusion... it's not ineffectual business strategies but rather sleazy, unethical business practices, found to be illegal, on the part of Microsoft that shut out competitors and indeed harm the consumer. Are you suggesting you cannot be successful unless you resort to MS tactics? Or perhaps, all's fair in love and war and business? Maybe we should have no rules or laws at all (get those pesky government regulations out of here). MS and its followers are the masters of FUD and misinformation (and shall we talk about behind the scenes phony, trumped up MS support campaigns including dead people and unwitting corporations? Or paying off the on-side States legal fees as an added bonus to sell out?) And since when is pointing out illegal behaviour "whining"? Hope you don't "whine" the next time someone steals your car or beats you to a pulp or does anything you deem illegal or unlawful. What's good for MS is not necessary good for the U.S. (or the world). This is perhaps the most specious and asinine argument put forth by Bill's disciples. It would truly be scary if MS did indeed carry so much financial clout as to rescue the world from this global economic downturn. No one corporation, person or government should wield so much power. The downturn started before the trial and was worsened by the events of Sept 11. How is Gates and MS going to elliviate those fears and uncertainties? Bottom line... as much as you disagree with the trial, facts came out that proved MS is less than ethical and is guilty of the charges made. But then, why let facts get in the way of a good personal bias (you and other MS apologists) or political agenda (the DOJ's capitulation). Paul, quit thinking independently and fall into line or you'll have to return your Billy Gates MS Decoder and Mind Control ring. It's obviously defective anyway... must run Microsoft software :-)

I do not agree with you in your comment. Microsoft can decide what is good for the company, no one should. If any remedy, it should not be directed to destroy or in the negative way instead, it should be a positive remedy which will be in the direction of progress and performance(Solaris and Lunix to be more effective and learn about consumers need) and creativity (create other software now), and not for destruction. So much energy, time, and money have been put to the destruction of Microsoft and not in the development and advancement of other product. If Microsoft is destroy today: by giving the souce code is to give more possibility to other to sabotage(as if the virus waves are not enough) Microsoft products, what other software do we have in replacement? Why destroy what we are already using with success? Today, I was trying to install Solaris 8 on Intel (Gateway laptop 5150) there is no driver for the graphic NEOMAGIC (Any help?). let other software be at the level of consumer need by performance and creativity and not by destruction of what everyone is already using. Do they know what people really want? To reduce consumers to accept something that is not working? Is that the reel goal here? Please, let us be more simple and look at the reality with "sagesse" and not with interest (financial). Give us something better than Microsoft and all consumers will be happy. Thank you. Cheik

The settlement by the federal government is another example of corporate welfare being codified by the government and white collar crimes overlooked as long as the corporations make big campaign contributions and employ enough lawyers and lobbyists (Look at the tax refunds to the big corporations in the economic stimulus package for another example and the Savings and Loan paltry punishments.) I hope the states hang tight and get some meaningful punishment.

In my personal opinion about the US and Microsoft in this situation.....the US is definitely in the wrong. Why in the world are we persecuting a man for his intellectual ability to make the most of what he has to offer to not only the US but in essense the world. When did the US begin punishing us as citizens for success? Why is it that this really has all come full circle to punishment to Bill Gates and his Company, Microsoft? I will tell you why.....POWER.....Bill Gates/Microsoft has too much of the market in this arena, and this is an apparent threat to society/the market/and the US..... This is appalling.....