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August 15, 1996

IBM BACK IN ANTITRUST HOT WATER WITH STORAGETEK

By CBR Staff Writer

No sooner has IBM Corp finally seen off the 1956 antitrust consent decree it so detested than it finds itself in hot water with the Justice Department’s antitrust division yet again. This time the issue is the alliance with Storage Technology Corp under which IBM takes over all marketing of the Louisville, Colorado company’s mainframe disk arrays. StorageTek disclosed in a quarterly filing with the US Securities & Exchange Commission that it received a civil investigative demand from the Justice Department on July 30. We anticipated that this could happen, and we were very thorough in our examination of whether the agreement would meet all the legal requirements, StorageTek told the Wall Street Journal. Justice would say only that We do have an investigation looking into possible anti-competitive practices in the direct access storage devices industry. IBM asserts that it and StorageTek will remain vigorous competitors in tape system and optical storage devices.

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