By Rachel Chalmers
The Wall Street Journal reports that Microsoft Corp is about to begin settlement talks with the US Department of Justice and 19 states. Observers say they do not believe a settlement will be reached before the federal antitrust trial resumes on April 12. Even so, both sides are preparing to meet. A previous effort broke down last May, before the case even went to court.
In spite of that early failure, Microsoft attorney Bill Neukom has apparently agreed to proceed with further negotiations after meetings with Bill Gates and other top executives. Judge Thomas Penfield Jackson has been foremost among those urging the combatants to consider a negotiated truce. We’re taking the judge’s suggestion seriously, another Microsoft official told the Journal. We continue to believe that on the core issues in this case we’ve established a strong record at trial. But it’s not in our interest, the government’s interest or the industry’s interest for this case to drag out for two more years.
Microsoft has indicated that it is willing to alter contracts the government claims are exclusionary, and to give PC manufacturers more leeway in how they set up the Windows desktop. Microsoft might also accept more limitations on the terms of Windows licenses. But the company’s practice of integrating applications like Internet Explorer and audio and video software with its operating systems, allegedly as a way of competing with rivals Netscape, Real Networks and Apple Computer, could prove to be the sticking point.
Microsoft’s right to add features to Windows is not negotiable, an official told the WSJ. The company insists that the government has no right to interfere with product development, and its lawyers point to an appeals court ruling that appears to support Microsoft on this point (CI No 3,410). But the government says that such integration forms part of a pattern of anti-competitive behavior. The parties have never seen eye to eye on this, and unless a compromise is found, the case will head back to court in April.
