Microsoft november 5 1999

Headline News brief. CNN networks. CNN programs. Go To The marketplace has changed, but will Microsoft? Enter keyword s go help. Jackson specifically finds that there was no legitimate economic purpose for Microsoft's illegal conduct. Microsoft fails to advance any legitimate business objectives that actually explain the full extent of this significant exclusionary conduct. Because the full extent of Microsoft's exclusionary initiatives in the [Internet Access Provider] channel can only be explained by the desire to hinder competition on the merits in the relevant market, those initiatives must be labeled anticompetitive.

There are no valid reasons to justify the full extent of Microsoft's exclusionary behavior in the [Internet Access Provider] channel. He also considers and specifically rejects Microsoft's contention that its activities were nothing more than the rough and tumble of the competitive process, redounding ultimately to the benefit of consumers:. These actions cannot be described as competition on the merits, and they did not benefit consumers. To the contrary, Jackson concludes that Microsoft's actions were the antithesis of competition on the merits and, in the broadest sense, constitute predatory behavior that is illegal under Section 2 of the Sherman Act.

Microsoft placed an oppressive thumb on the scale of competitive fortune, thereby effectively guaranteeing its continued dominance in the relevant market. More broadly, Microsoft's anticompetitive actions trammeled the competitive process through which the computer software industry generally stimulates innovation and conduces to the optimum benefit of consumers.

Microsoft's campaign must be termed predatory. Since the Court has already found that Microsoft possesses monopoly power. After considering each of Microsoft's arguments to the contrary, he demonstrates that Microsoft's conduct, taken as a whole and in its entirety, is both illegal under the Sherman Act and harmful to consumers, whom the Act is designed to protect.

Given the Court's Findings and Conclusions of Law, it is a virtual certainty that Microsoft will be subject to remedial action of some form. The available remedies fall into two broad categories, conduct remedies and structural remedies. Microsoft's defenders have generally focused their commentary on the prospect of conduct remedies, which would place restrictions on Microsoft's future behavior. While we are not prepared to exclude the possibility that some form of conduct remedy could be beneficial, the ones proposed thus far would appear to do more harm than good.

Given the range of illegitimate behavior documented by the court, and the complexity of the software industry, a meaningful conduct remedy would require a lengthy list of conduct restrictions and requirements. The imposition of such a remedy on Microsoft would be burdensome for the company and difficult, if not impossible, for the government to enforce.

The real danger, however, is that a conduct remedy would lead the decree court and the Department of Justice to function as de facto regulatory agencies, monitoring the operations of a firm with 30, employees producing dozens of technologically sophisticated products.

And, because Microsoft has dealings throughout the software industry, oversight of Microsoft by the decree court might well lead to indirect oversight of other firms as well. In sum, there are legitimate concerns about conduct remedies in the Microsoft case. A well-designed structural remedy, on the other hand, is subject to none of the concerns described above.

We have proposed a "competitive remedy" that would replace the current monopoly with a competitive market structure. The competitive remedy we propose would immediately replace the existing operating system monopoly with a competitive market. In so doing, it would eliminate the need for ongoing regulation and dramatically reduce the potential for subsequent litigation. Furthermore, we believe it is highly likely that the competitive remedy would result in far more rapid innovation in computer operating systems than we have witnessed over the course of the past decade, for the simplest of reasons: Competitive firms have an incentive to innovate in order to win business away from their competitors; monopolists do not.

Microsoft's defenders have offered several arguments in opposition to such a remedy, two of which are worthy of rebuttal. The first is that this solution is unworkable because the task of dividing up a complex firm like Microsoft is too difficult, or the costs too great. June 24, The trial adjourns after 76 days of testimony spread over more than eight months. June 1, Round two of the antitrust trial begins. May 18, Netscape executive Peter Currie testifies in a deposition that he once wondered if America Online's fear of Microsoft might scotch its purchase of Netscape.

March 30, Attorneys from both sides meet for settlement talks. March 10, A leaked Microsoft memo blames the press for focusing on Bill Gates rather than the facts of the trial. March 4, Senator Slade Gorton, a Republican from Microsoft's home state of Washington, says the Justice Department has gone too far and should drop the case against his constituent.

February 26, The trial breaks for recess. February 2, A government lawyer accuses Microsoft of manipulating videotaped evidence in a courtroom demo. January 13, The defense phase of the trial begins. January 12, The final day of the government's case. In a climactic turn, the government's top economic witness admits that Microsoft has done nothing so far that would harm consumers. November 17, Sun Microsystems wins a crucial ruling when a federal court tells Microsoft to stop selling products that contain an incompatible version of Java.

Meanwhile, South Carolina drops out of the antitrust lawsuit against Microsoft, saying there was sufficient competition in the Internet market. November 9, Microsoft chairman Bill Gates testifies in a videotaped deposition that he never intended to keep Intel out of the software business. October 19, The court hears opening arguments in the first day of the antitrust trial. September 22, According to a study by a market researcher, Netscape finally cedes its browser-share lead to Microsoft's Internet Explorer.

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