Bill Gates \nWASHINGTON - It could end up reshaping the computer world entirely, depending on whether he rules ultimately for breaking up the software giant, but federal judge Thomas Penfield Jackson ruled Friday that Microsoft is an aggressive monopoly which "use(s) its prodigious market power and immense profits to harm any firm that insists on pursuing initiatives that could intensify competition against one of Microsoft's core products.''
The Associated Press calls the findings of fact "a decision heavily tilted toward the government's antitrust case", one of the biggest of the century. Microsoft vows to continue fighting the case, which it says became irrelevant the day rival Netscape was bought outright by America Online.
Microsoft executives and others talked up the prospect that, well before any final penalty is ruled upon, Microsoft and its rivals could settle the case. ``From the very beginning, we've said we would like nothing better than to settle this case,'' Microsoft chairman Bill Gates told a Friday news conference, while reiterating any settlement must secure Microsoft's right - and others in its industry, he emphasized - to improve and innovate.
It was the rivalry between Netscape and Microsoft, plus accusations that Microsoft virtually jammed Windows down the industry's throat, which triggered the anti-trust case, filed by the Justice Department with 19 states joining.
Microsoft was accused, basically, of trying to smash Netscape's Internet browser by forcing computer makers wanting to put Windows in as free starting operating software to include Microsoft Internet Explorer with the package - all the while making certain, as Jackson ruled, through aggressive market and business tactics, that "no commercially viable alternative" to Windows could long exist.
Jackson ruled that "three main facts" proved Microsoft's monopoly aggression: Microsoft's share of Intel-compatible operating systems being "extremely large and stable"; the company's dominant market share "protected by a high barrier to entry"; and, because of that "barrier," customers having no choice but to buy and use Windows.
Jackson even ruled that Microsoft had played cut-your-own-nose-to-spite-your-face to press its advantage with AOL before the Netscape deal, finding that Microsoft was even willing to undermine its own Microsoft Network package in order to freeze Netscape Navigator out of the loop and compel AOL to choose Internet Explorer over Navigator.
The case polarized computer-industry watchers and Internet mavens from the outset. The day before Jackson handed down his findings of fact, the Washington Post - a frequent Microsoft critic - published an editorial called "Why Microsoft Should Lose":
"(T)he government's core evidence that Microsoft currently enjoys a monopoly over operating systems is quite strong. And its evidence that Microsoft has attempted to leverage that monopoly into dominance of the market for Internet browsers and other so-called "middle-ware" is even stronger. That some of its tactics crossed the legal lines of what a monopolist is permitted to do also seems clear. Microsoft's attempts to rebut the Justice Department's evidence have been generally under whelming. The company's behavior should carry some penalty-even in an industry to which the antitrust laws apply so uncomfortably.
"The more difficult task," the editorial continued, "will be crafting remedies that will curtail the company's anti-competitive behavior without unduly handicapping it or micromanaging an industry that has thrived--and enormously benefited consumers--in the absence of government intrusion. This would be no mean feat, but even in the absence of obvious remedies, a finding of liability would be enormously valuable--a first step toward laying down the rules of competitive behavior in high-tech markets."
But there doesn't seem yet to be a broad consensus in favor of breaking up the software giant, should Jackson rule for it in due course. E-Commerce Times columnist Chet Dembeck says there's simply no "good" remedy, with "each potential remedy a minefield."
"The consensus among most analysts seems to be the same," Dembeck says. "They agree that it would be an industry nightmare for the day-to-day operations of Microsoft becoming subject to the approval of a federal court -- or some sort of newly-established Internet Commerce Commission. If history teaches us anything, it shows that a new brood of baby Microsofts won't solve the monopoly problem -- or be a godsend to stockholders or consumers."
The findings of fact were the hot topic around the Internet's chat and message community Friday. "It is all over but the crying," said a Friday posting from "fishingfreak" on a Yahoo! Bulletin board. "Turn out the lights, the party is OVER." Others, though, noting a likely dip in Microsoft stock, were hoping stockholders might sell in order to let new buyers all but clean up on the company stock. Microsoft did fall three points in the wake of the findings of fact.
