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A Year Ago: US vs MS - the case at a glance

First published: Mon, 18 May 1998 17:05:43 GMT
Written by Patrick Houston, Contributor

It's a big story. After all, this is the world's most powerful government taking on one of the world's foremost corporations, led by one of the world's richest men.

It's a complicated story, too, involving the law, technology, business -- even politics. What follows is a quick digest of the case as it's unfolded so far. There are three main parties in the Microsoft antitrust action. They are:

Microsoft, based in Redmond, Washington. The U.S. Department of Justice, (DoJ) Antitrust Division, Washington. Attorneys general from some 18 states. Based on reports, these are the government's main demands:

Cease integrating Internet access into Windows. Allow others to customise Windows startup screen and desktop. No longer require PC makers to accept Internet Explorer browser with Windows.

Include Netscape's Navigator browser with Windows. Exclude other Microsoft technologies from Windows. Remove Windows interface seen by users when they boot up for the first time.

Some others who will play a major role:

Richard J. Urowsky, a member of Sullivan & Cromwell, the outside firm that has defended Microsoft in previous antitrust action.

David Boies defended IBM against in its antitrust case with the government. Now he's been hired by the DOJ to help prosecute the Microsoft case.

Tom Miller, attorney general of Iowa, chairs the antitrust committee of the National Association of Attorneys General. He appears to have a decidedly populist streak.

Richard Blumenthal, attorney general of Connecticut, is also a member of NAAG's antitrust committee. Sen. Orrin Hatch, is chairman of the senate's judiciary committee and has emerged as one of Microsoft's most vocal critics in Washington.

Senator Slade Gorton, is the esteemed gentleman from Microsoft's home state and, of course, an ardent defender.

Up to now, it's been a war of words. Here are some of the latest salvos launched by both sides:

Microsoft Chairman and CEO Bill Gates: "What the government is asking would significantly hamper us from competing through innovation and would put everything we've worked for and built for the last 23 years at risk."

Government source to the Washington Post: "All parties recognised that in light of Microsoft's unwillingness to address competitive concerns, the talks broke down. There's clearly a chasm between the sides that cannot be bridged."

Senior government official to the New York Times: "Some of the attorneys general got the feeling that Microsoft was just fooling around, trying to learn as much as possible about what we planned to do."

Microsoft spokesman Greg Shaw: "When we saw their demands, it became clear to us that they were intended to benefit a competitor, not the public."

White House Economic Adviser Gene Sperling: "...the president has full confidence and fully supports the justice department officials handling this case."

It's all about the law. Here are some terms you'll hear over and again in the weeks to come:

Monopoly: A situation where a single entity (seller or producer) supplies a commodity or a service. Operating in an environment where there are no real substitutes for the product or service sold, the monopoly thus controls pricing.

Sherman Antitrust Act: Passed in 1890, prohibits a monopoly or restraint of trade in interstate commerce.

Clayton Act: Enacted in 1914 to amend the Sherman Antitrust Act to prohibit price-fixing conspiracies in interstate commerce.

Predatory Pricing: Pricing tactics employed by a dominant firm to drive competitors out of business, such as temporarily selling below cost and dropping the price only in certain markets.

Take me to the DOJ/Microsoft special

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