CNET News.com: [MS Preparing for Breakup?] Antitrust issues loom over Tandy pact

“Some antitrust experts have concluded that a ‘structural
remedy,’ such as breakup of the company, is the inevitable outcome
of the trial.
So given that Microsoft has a lot of money to
spend–several billions of dollars–the company may be building
what could eventually become independent businesses, industry
veterans and legal experts said today.

High-tech analysts point to a string of recent Microsoft
that, on the surface, seem to indicate aggressive
expansion into new markets. But when viewed a different way, the
deals appear to create the structure for two or possibly three
different companies.
Berge Ayvazin, president of market
researcher the Yankee Group, sees… ‘Microsoft has prepared itself
not only to offer up but [to] implement a structural change at an
appropriate time in settlement, and that is to separate Microsoft’s
Internet businesses from its software business’…”

“The Supreme Court has long mandated that legal intervention,
such as a court order barring a company from specific activity, ‘is
insufficient when dealing with a durable and pervasive monopoly,’
said Glenn Manishin, a high-tech antitrust attorney with Blumenfeld
& Cohen in Washington. Based on Jackson’s ruling, known
formally as findings of fact, a breakup ‘is almost a foregone
conclusion,’ Manishin said.

International Data Corporation analyst Roger Kay points to the
landmark AT&T divestiture case, which bears some striking
similarities. After derisive findings of fact in that case…
before the final court ruling, AT&T ‘aligned the company
internally, making lines of cleavage’ so that when the judge
‘hammered, things broke apart just the way that AT&T wanted,’
Kay said.


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