Manu
07-30-2001, 02:50 PM
The X Factor
New Operating System Key to Antitrust Suit
By Peter Dizikes
N E W Y O R K, July 30 — As representatives from Microsoft and the Department of Justice have begun discussing a possible settlement of the government's antitrust suit against the software giant, one issue continues to loom over the case: the October release of Microsoft's new XP operating system.
The two sides have held preliminary discussions in Washington, nearly a month after an appeals court ruling presented some good news for both sides in the protracted case.
On June 28, the court upheld District Court Judge Thomas Penfield Jackson's finding that Microsoft had illegally taken advantage of its operating systems monopoly, although it overturned his proposed remedy of splitting the company in two.
The Microsoft Case: Complete Coverage
Left to be resolved by a different district court judge: whether or not Microsoft can legitimately "bundle" programs (such as its Internet Explorer browser) into its operating systems.
And that's where the status of the forthcoming Windows XP operating system, perhaps Microsoft's most ambitious to date, comes in to play. As part of Microsoft's new ".Net" strategy, Windows XP includes several new features that could usurp applications produced or developed by rivals, including instant messaging, video and audio streaming media and digital photography.
Given the new features bundled into the new operating system, industry observers assume the Redmond, Wash.-based company wants to ensure that XP hits the market before the bundling issue is resolved in court.
"They certainly are trying to delay an expedited hearing," says Rob Enderle, an analyst for Giga Information Systems in California, about Microsoft. "The closer they get to the ship date, the much more likely the court is to give them a break on XP."
Congress Gets Into the Act
Sensing the same thing, a number of politicians wary of Microsoft are taking the same view about XP. Sen. Charles Schumer, D-N.Y., said last week he had asked the Justice Department's antitrust division not to settle with Microsoft unless the computer giant gives equal access to the competitors' applications on Windows.
"It appears to me that Microsoft intends to maximize its monopolistic power, using XP as a platform to enter new lines of business while encumbering competitors," said Schumer.
In response, Microsoft issued a statement implying that Schumer was acting on behalf of its Web rival, New York-based AOL Time Warner, adding that, "Contrary to AOL's self-interested lobbying, Windows XP is designed to enable user choice and partner opportunity."
The Senate Judiciary Committee, of which Schumer is a member, announced last week it will hold September hearings investigating the Windows XP system. The committee has yet to name witnesses and it is not clear if any Microsoft representatives will testify.
End May Not Be Near in Legal Battle
As for the resolution of the antitrust suit, a few possibilities remain, including a settlement or another district court ruling — which could still be appealed, up to the U.S. Supreme Court if necessary.
Enderle believes Microsoft is trying to keep its new operating system entirely intact: "If it is blocked, significantly altered or otherwise impacted, than it does put XP at risk," says Enderle.
David Card, a senior analyst at Jupiter Media Metrix in New York, claims it is "impossible" to predict what will happen in the case, but says Microsoft is clearly not willing to concede any ground on the bundling issue in a possible settlement.
"There's several issues they would never settle," Card says, including bundling: "They [want to] reserve the right to decide what a product is. They want to be able to make that call."
www.abcnews.com (http://www.abcnews.com)
------------------
Manu Narayan
New Operating System Key to Antitrust Suit
By Peter Dizikes
N E W Y O R K, July 30 — As representatives from Microsoft and the Department of Justice have begun discussing a possible settlement of the government's antitrust suit against the software giant, one issue continues to loom over the case: the October release of Microsoft's new XP operating system.
The two sides have held preliminary discussions in Washington, nearly a month after an appeals court ruling presented some good news for both sides in the protracted case.
On June 28, the court upheld District Court Judge Thomas Penfield Jackson's finding that Microsoft had illegally taken advantage of its operating systems monopoly, although it overturned his proposed remedy of splitting the company in two.
The Microsoft Case: Complete Coverage
Left to be resolved by a different district court judge: whether or not Microsoft can legitimately "bundle" programs (such as its Internet Explorer browser) into its operating systems.
And that's where the status of the forthcoming Windows XP operating system, perhaps Microsoft's most ambitious to date, comes in to play. As part of Microsoft's new ".Net" strategy, Windows XP includes several new features that could usurp applications produced or developed by rivals, including instant messaging, video and audio streaming media and digital photography.
Given the new features bundled into the new operating system, industry observers assume the Redmond, Wash.-based company wants to ensure that XP hits the market before the bundling issue is resolved in court.
"They certainly are trying to delay an expedited hearing," says Rob Enderle, an analyst for Giga Information Systems in California, about Microsoft. "The closer they get to the ship date, the much more likely the court is to give them a break on XP."
Congress Gets Into the Act
Sensing the same thing, a number of politicians wary of Microsoft are taking the same view about XP. Sen. Charles Schumer, D-N.Y., said last week he had asked the Justice Department's antitrust division not to settle with Microsoft unless the computer giant gives equal access to the competitors' applications on Windows.
"It appears to me that Microsoft intends to maximize its monopolistic power, using XP as a platform to enter new lines of business while encumbering competitors," said Schumer.
In response, Microsoft issued a statement implying that Schumer was acting on behalf of its Web rival, New York-based AOL Time Warner, adding that, "Contrary to AOL's self-interested lobbying, Windows XP is designed to enable user choice and partner opportunity."
The Senate Judiciary Committee, of which Schumer is a member, announced last week it will hold September hearings investigating the Windows XP system. The committee has yet to name witnesses and it is not clear if any Microsoft representatives will testify.
End May Not Be Near in Legal Battle
As for the resolution of the antitrust suit, a few possibilities remain, including a settlement or another district court ruling — which could still be appealed, up to the U.S. Supreme Court if necessary.
Enderle believes Microsoft is trying to keep its new operating system entirely intact: "If it is blocked, significantly altered or otherwise impacted, than it does put XP at risk," says Enderle.
David Card, a senior analyst at Jupiter Media Metrix in New York, claims it is "impossible" to predict what will happen in the case, but says Microsoft is clearly not willing to concede any ground on the bundling issue in a possible settlement.
"There's several issues they would never settle," Card says, including bundling: "They [want to] reserve the right to decide what a product is. They want to be able to make that call."
www.abcnews.com (http://www.abcnews.com)
------------------
Manu Narayan