Gates saw his stake in Microsoft, the muscular software company he co-founded, rise by more than $2 billion when a judge closed the case on an antitrust settlement with the U.S. government last week and shares in the company shot higher as an immediate response. While that may pale in comparison to other billion-dollar swings in his favor during Microsoft's 27-year history, it could prove to be the sweetest gain yet, even as the company still faces a battery of remaining lawsuits.
But with Microsoft still facing legal challenges to its market position, Gates has also shown a new-found respect for public diplomacy, observers said. "We are committed to being a responsible industry leader," Gates told reporters after the ruling, joined by his wife Melinda, credited by many with helping to keep his legendary temper in check at his second trial appearance in April.
Software giant Microsoft said it plans to open a software training centre in China's Jiangsu province, its third such centre in the country. The world's biggest software maker said at the weekend it has agreed to set up the centre with Jiangsu NandaSoft, a maker of network security software, in the city of Nanjing. The centre will assist software developers throughout Jiangsu, one of China's wealthiest provinces whose major cities include Nanjing, Suzhou and Wuxi. Microsoft and Nandasoft engineers will also work with each other at the facility.
The federal court decision on Friday endorsing a settlement that closes the U.S. government's landmark antitrust case against Microsoft Corp. will allow the software giant to leverage its dominance in computer operating systems to move into other markets, experts and rivals said. That is good news for Microsoft's allies, such as Intel Corp., Siebel Systems Inc. and others, but bad news for the raft of companies including Oracle Corp, Sun Microsystems and RealNetworks Inc struggling to compete with Microsoft, they said.
"Microsoft lost every battle and they won the war. That's what happened here," said Shane Greenstein, technology business professor at the Kellogg Graduate School of Management. "The lesson everyone learned here is just stay out of Microsoft's way."
A federal judge on Friday accepted nearly all the provisions of an antitrust settlement between Microsoft Corp. and the Justice Department, but warned top company executives that she will hold them individually responsible for complying with her instructions. In an enormous victory for Microsoft and founder Bill Gates, U.S. District Judge Colleen Kollar-Kotelly rebuffed arguments by nine states and the District of Columbia that tougher sanctions were essential to restore competition in the computer industry.
She concluded that some penalties proposed by those states would chiefly benefit the company's rivals. She made a few minor changes to the settlement that require acceptance by Microsoft and the Justice Department.
Two big business stories with more than a little local fascination broke yesterday, from seemingly disparate industries, on different coasts, in different forums. Yet they shared two common elements. Both had to do with technology. And both were cases of official ratification of what, in the real world, are foregone conclusions.
Yesterday a federal judge in Washington, D.C., issued a ruling in the Microsoft antitrust case, almost completely upholding a settlement worked out between the Redmond software company, the U.S. Justice Department and nine states. In doing so she rejected the arguments from nine other states that Microsoft should be subject to much more stringent penalties than the settlement provides. She sided with the dissenting states only on the matter of how and by whom Microsoft's compliance with her ruling will be monitored.
A federal judge yesterday approved a settlement that assures that Microsoft Corp. -- a declared monopolist in the PC operating-system market -- will indeed be regulated, but with a gentle touch. It was a clear victory for the Redmond company in its 4-year-old antitrust suit. U.S. District Judge Colleen Kollar-Kotelly approved the deal reached by Microsoft, the Justice Department and nine states, and delivered a stinging rejection to nine other states that had sought harsher penalties against the world's largest software maker.
The decision, which took 19 weeks to formulate and more than 500 pages to explain, drew outrage from competitors and their trade associations. Critics called the ruling a rubber stamp and predicted an appeal.
Even as Microsoft Corp. won endorsement of its antitrust settlement with the Justice Department yesterday, a number of other antitrust cases are pending against the world's largest software maker.
They range from a suit by rival AOL Time Warner to hundreds of claims by individual consumers in several states, many consolidated in the Baltimore courtroom of one federal judge. While future judgments in U.S. courtrooms may be guided by yesterday's ruling, the antitrust scrutiny of the 15-nation European Union is less likely to be swayed.
For five years -- or longer, if the judge says so -- Microsoft must:
- Lift illegal licensing requirements for computer makers.
- Stop restricting what icons, menus or services computer makers put on their products.
- Avoid retaliating, or even threatening to retaliate, against computer makers that sell PCs using or promoting non-Microsoft software.
- Within three months, make available a wide range of Communications Protocols, which are small pieces of software that link Windows-based products with Microsoft servers.
- Appoint a Compliance Committee made up of three board members who aren't past or current employees.
Microsoft's five-year antitrust case may have reached its anticlimactic end.
Unless one side or another decides to appeal, a decision by U.S. District Judge Colleen Kollar-Kotelly on Friday could mark the final chapter in a case once said to be a definitive one for antitrust law in the 21st century. Neither Microsoft, the U.S. Justice Department, nor the group of states that signed on to what is now an official settlement has a strong incentive to continue the case. For his part, U.S. Attorney General John Ashcroft called Friday's decision a "major victory for consumers."
U.S. District Court Judge Colleen Kollar-Kotelly said Friday that she rejected harsh antitrust punishments for Microsoft because they would unfairly benefit its competitors.
In her strongly worded decision, Kollar-Kotelly said that the remedies proposed by nine state attorneys general were so outlandish that they amounted to an "unjustified manipulation of the marketplace" designed to give competitors such as Sun Microsystems, Apple Computer, and Red Hat an "artificial advantage."
In a 344-page decision, Kollar-Kotelly dismissed many of the proposals as based on a misunderstanding of antitrust law and the purpose of 32 days of remedy hearings this spring.