Within minutes of the announcement that the U.S. Department of
Justice would not seek a breakup of Microsoft Corporation or a
retrial of Microsoft on the grounds that it violated the law in
bundling its Internet Explorer browser, news sites and discussion
groups were filled with acrimonious talk about how the government
had rolled over for Microsoft.
An examination of the facts in the case, though, paints an
entirely different picture: the DoJ and the 18 states who are also
party in the antitrust action against Microsoft agreed that
continuing to retry the parts of the case overturned by the U.S.
Court of Appeals in Washington would do nothing more than allow
Microsoft to continue its illegal behavior for additional years of
"And even then, there is no certainty that we would win, or that
the decision would survive an appeal to the Supremes," said an
attorney in the Connecticut attorney general's office a few hours
after the announcement. "It is better to consolidate -- we won the
greatest part of the case and are confident it will withstand
appellate scrutiny. There were a number of lawyers in the case who
doubted that Judge [Thomas Penfield] Jackson's remedy would have
solved the problem. Far from capitulating, we're in a situation
that ought to have Microsoft quaking in fear."
In its announcement, the Justice Department said that it was
dropping plans to seek a breakup of Microsoft and a reconsideration
of the allegation that in tying its Internet Explorer the company
violated antitrust laws by illegally maintaining a monopoly. The
breakup remedy, and the tying finding, were both overturned in the
Court of Appeals, though the DoJ could have sought them again. But
this would likely have involved many months, even years, of
additional court proceedings, during which Microsoft would be free
to continue behavior that had already been found illegal, which
finding had survived the appellate panel.
"In view of the Court of Appeals' unanimous decision that
Microsoft illegally maintained its monopoly over PC-based operating
systems -- the core allegation in the case -- the Department
believes that it has established a basis for relief that would end
Microsoft's unlawful conduct, prevent its recurrence and open the
operating system market to competition," the announcement said.
"The Department also informed Microsoft that, in light of the Court
of Appeals opinion and the need for prompt, effective and certain
relief, the Department will not seek a break-up of the company into
separate operating systems and applications businesses, as
previously had been ordered by the court. Instead, the Department
will seek an order that is modeled after the interim
conduct-related provisions of the Final Judgment previously ordered
in the case."
This means that the department will ask a judge to enjoin
Microsoft from conduct that promotes and extends its monopoly. Some
of the interim provisions under consideration include:
Requiring Microsoft to make its APIs available to competitors.
This could well include its application file formats.
Prohibiting Microsoft from employing designs which break
Prohibiting Microsoft from entering into exclusive distribution
agreements with third parties, and from taking action against
companies that distribute other vendors' software.
Allowing computer vendors to decide what will boot, and in what
order, on the machines they sell, and to determine themselves what
will appear on the desktop, including the Windows desktop.
In addition, the DoJ asked for expedited discovery -- the
speedy revelation of documents and records -- detailing Microsoft's
activities in the months since the verdict was reached against the
company. This, department lawyers say, could result in a request
for additional remedies against Microsoft.
Despite a roundup of uniformly hysterical and uniformly
erroneous broadcast and print reports, the remedies now being
sought are potentially far more restrictive than the ones approved
by Judge Jackson at trial and overturned on appeal.
How might this benefit Linux where a Microsoft breakup would not
Opening the APIs and especially the file formats certainly
allows competition in the compatible office suite market, including
open source software. Additionally, it would enjoin Microsoft from
unilaterally changing standards, because the new specifications
would need to be made publicly available at the same time they are
given to application developers. (Enforcement might be tricky, but
it would not be possible suspiciously quickly to come to market
with applications based on new specs.) The same holds true of a ban
on software which breaks the applications of other vendors.
A change in Microsoft's licensing agreements would make it
possible for vendors to ship machines containing both Microsoft and
other operating systems, with the user deciding which one to make
the default. And it would prohibit the company from penalizing
vendors for doing so. A Linux distribution included at little or no
extra cost might prove to be an attractive value add to some
computer makers, who are already struggling.
What does Microsoft think of the DoJ's change in direction?
There was a terse, one-line statement issued by the company, to the
effect that the company is committed to resolving all outstanding
issues. But earlier it said that the remedies, when handed down in
interim form by Judge Jackson before his final ruling, would put
the company out of business. While that was probably overstatement
for effect, it is clear that the new remedies would force Microsoft
to change the way it does business.
In making the decision it has, the government has decided that
justice has been delayed too long. Whatever the ultimate remedies
selected by the court, they are likely to be put into effect very
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