Microsoft Lawyer Defends MS Remedy Proposal

SAN FRANCISCO (05/10/2000) - Microsoft Corp.'s lead counsel said his company has offered to make "very considerable concessions" to resolve its antitrust case with the U.S. government. He argued that alternative remedies proposed by the U.S. Department of Justice (DOJ) would have devastating consequences for consumers and the software industry.

The software giant issued its proposed remedies in the antitrust case today.

The remedies include restrictions on the way that Microsoft can use software licensing agreements with PC manufacturers as a way of promoting the use of its applications and operating systems.

Microsoft's offer amounts to "an enormously broad amount of flexibility for (PC manufacturers) and a very considerable concession by Microsoft," Bill Neukom, Microsoft's executive vice president for law and corporate affairs, said in a teleconference with the press this afternoon.

"We have filed our own proposed final judgement and believe it addresses the court's conclusions of law and provides full relief for each violation found by the court," Neukom said.

The government's proposal, on the other hand, goes beyond anything that is reasonably applicable under the Sherman Act antitrust laws, Neukom said. In particular, the government's requirement that Microsoft make public key elements of its Windows operating system source code would be particularly damaging, he added.

"In practical terms, IBM (Corp.) and Sun (Microsystems Inc) would receive billions of dollars worth of Microsoft's energy," Neukom said. "We'd be effectively competing with ourselves, against our own invented intellectual property."

Microsoft also proposed today that the remedy portion of the trial be extended, and offered three options for when oral arguments should begin. The options vary according to the severity of the remedies that U.S. District Court Judge Thomas Penfield Jackson, who is overseeing the case, elects to consider, Neukom said.

"The more extreme the remedy, the more extensive the procedure, and the larger the amount of time that Microsoft deserves to defend itself," Neukom said.

If the court decides to consider both of the government's remedy proposals, for example -- to break up Microsoft and to force the company to make public some of its intellectual property -- Microsoft requests that the start of oral arguments be delayed until Dec. 4, 2000, Neukom said.

The Microsoft counsel wouldn't be drawn on how long such a hearing might last, but implied that it would be a lengthy and drawn out process. The trial would need to look at all the possible consequences of breaking Microsoft up -- the impact on the software giant itself, on consumers, on the software industry as a whole, and on the economy, Neukom said.

"You have a very large universe of information that requires business analysis," he added.

Microsoft, in Redmond, Washington, can be reached at +1-425-882-8080 or http://www.microsoft.com/.