The Justice Department set out to prove Wednesday that its antitrust settlement with Microsoft is a bird in the hand and better than what it reasonably could have expected if it had gone back to court to seek tougher penalties.
Philip Beck, speaking for the government, told U.S. District Judge Colleen Kollar-Kotelly that a federal appeals court radically narrowed the scope of Microsoft's wrongdoing, making it difficult for the government to seek stronger penalties against the software giant.
Getting more "would have been an uphill battle that likely would have been resolved against us," said Beck. He argued that the settlement still goes further than what the appeals court decided was Microsoft's legal liability.
The settlement would prevent Microsoft from retaliating against partners for using non-Microsoft products; require the company to disclose some of its software blueprints so software developers can make compatible products; and make it easier for consumers to remove extra Windows features.
The U.S. Justice Department on Wednesday conceded that it settled with Microsoft in part because trustbusters failed to prove part of the basic theory of the antitrust case. In his presentation before U.S. District Judge Colleen Kollar-Kotelly, Justice Department lead attorney Philip Beck said that Microsoft was able to hold on to a monopoly in Intel-based operating systems only through anti-competitive acts. But the government was not in a position to make that argument stick, he said.
In the public-interest hearings, Microsoft and the settling states are scheduled to make presentations later Wednesday. A number of third parties also are scheduled to make 10-minute presentations to the court, among them the American Antitrust Institute, telephone company SBC Communications and the ProComp trade group. AAI receives funds from Microsoft competitor Oracle, while ProComp is backed in part by AOL Time Warner, Oracle and Sun Microsystems.
Even in conceding the limits of the government's case, Beck emphasized its successes. "It was a major victory and accomplishment," he said. But in looking at the language of the appeals court decision and what the Justice Department was able to obtain through the settlement, the government is satisfied that it cut a deal that is in the public interest and that exceeds the mandate of the court of appeals, Beck said.
Almost four years after the US government and 19 states brought sweeping antitrust lawsuits against Microsoft, the company's biggest legal mess could all wrap up soon, after a few days of hearings in a federal courthouse in Washington DC. The hearings begin Wednesday morning, at which time Microsoft, the US Department of Justice (DOJ), and 9 states will attempt to encourage Judge Colleen Kollar-Kotelly to fully accept the proposed settlement agreement that the parties reached last November. But several problems could prevent Microsoft from having a happy ending, including the fact that the judge may rule that the agreement is not in the public interest and simply throw out the settlement. Furthermore, the company faces a separate set of hearings next week, in which nine non-settling states and the District of Columbia will seek more stringent remedies against Microsoft. This "separate track," as the judge calls it, is expected to last several weeks.
Microsoft Corp. and the U.S. government pitch their antitrust settlement to a federal judge on Wednesday, hoping to get her endorsement despite objections from nine states seeking harsher sanctions against the company. Lawyers for the software giant and the U.S. Justice Department will try to convince U.S. District Judge Colleen Kollar-Kotelly the settlement is in the public interest, even as lawyers prepare for separate proceedings on the possibility of tougher remedies. Both sides will be watching the judge for any sign she may be prepared to endorse the settlement before the March 11 start of remedy hearings.
Microsoft Corp. on Tuesday asked the federal judge overseeing its antitrust case for a two-week postponement of hearings due to start next week on sanctions against the company. In a filing with U.S. District Judge Colleen Kollar-Kotelly, Microsoft said it needed the extra time to weigh a revised remedy proposal filed Monday by a group of nine states that have rejected a settlement of the case. Microsoft said the revision came without warning after Microsoft had already interviewed all but one of the non-settling states witnesses in preparation for the hearings.
Photo services company PhotoWorks announced Tuesday a deal with Microsoft to provide photo-printing services through the software giant's MSN site. MSN subscribers who store photos on the site, a service MSN has offered for several years, will be able to order prints from PhotoWorks starting this fall, according to the announcement. Prices for prints of digital photos will range from 35 cents to $2.99 each, depending on size. The deal is similar to Hewlett-Packard's recent agreement with Shutterfly to provide printing services for HP's photo sharing site.
In the deposition, Ballmer argued that sanctions sought by the nine remaining plaintiff states would force Microsoft to remove its Windows operating system (OS) from the marketplace altogether. "It guarantees that the only way to comply effectively is to remove the product from the market," Ballmer said. "If you can't ship Windows, the whole game's kind of over."
Consumer Justice?
But Peter Kastner, chief research officer at research firm Aberdeen Group, told NewsFactor that meddling by the state attorneys general could cause immeasurable damage to consumers if Microsoft is forced to dismember Windows.
"Obviously, they know nothing about how software is designed, written, tested and profitably marketed," Kastner said. "This is not some clean-sheet academic exercise in microeconomics but real-world messing with the business and leisure lives of a hundred million citizens." Kastner contended that an anti-Microsoft ruling would make it extremely inconvenient and expensive for consumers to buy, install and maintain all of the different "middleware" that the state attorneys general are saying must be removed from Windows.
"I think it would be a huge disruption to the economy and a royal pain for consumers, while costing them more in dollars and a lot more in lost productivity and leisure time," he said. "This is progress in the name of justice?"
Who runs SAP solutions faster? The answer: Microsoft Corp. A 32-processor Unisys Corp. database server running Microsoft Windows Datacenter Server Limited Edition and Microsoft SQL Server 2000 Enterprise Edition delivered the best performance on the highly coveted SAP AG Standard Application Sales and Distribution (SAP SD) Three-Tier Benchmark. Businesses that rely on their software to deliver scalable growth for enterprise applications can achieve better results with a Windows- and SQL Server-based system.
The SAP Standard Application SD Benchmark has become a de facto standard that today's leading companies depend on for measuring the scale-up performance of SAP-based systems. It provides a key measure of real-world performance in the e-business environment by simulating the maximum number of users a given system can handle while maintaining response times of less than two seconds.
Microsoft on Monday released Windows Datacenter Special Edition, a version of its high-end operating system for retail, financial, telecommunications and Internet service providers doing data mining and warehousing, online analytical processing and e-commerce online transaction processing. Microsoft released Windows 2000 Datacenter in August 2000, but two other high-end versions of Windows also are in the pipeline.
In August, the Redmond, Wash.-based company released Windows Advanced Server Limited Edition for Intel's Itanium processor. Last week, Microsoft disclosed that Windows .Net Server would ship in the second half instead of the first as previously indicated. The successor to Windows 2000 Server, .Net Server, is testing, currently at beta 3.
In a short clip from the deposition tapes released by Microsoft, CEO Ballmer says he's serious about implementing a remedy and that it's the best decision for consumers.
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