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Technology Stocks : How high will Microsoft fly?
MSFT 484.85-0.2%Dec 22 3:59 PM EST

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To: John F. Dowd who wrote (66950)4/9/2002 11:51:19 PM
From: David Howe  Read Replies (2) of 74651
 
I'm not sure if it has legs or not, but it probably doesn't matter that much. She might rule that the remedy must make assumptions about the future or something to that effect, but I doubt that the remedy will be harsh enough to have a significant effect on MSFT.

The DOJ is arguing with MSFT that the remedy / settlement is sufficient. Will the judge really deviate dramatically from this? I doubt it. She might give the competitors a bit more, but she would be going out on a serious limb to deviate dramatically from what our nation's Department of Justice has recommended. She'd risk a complete reversal by the Supreme Court.

My guess is that she either accepts the settlement terms and rejects the remaining state's arguments entirely, or she gives a taste of success to the states so they can claim a minor victory.

Besides, what's the worst that can happen? MSFT must turn over more of their code? They just sue anyone that uses their code illegally. It's a minor problem that they wouldn't have complete control, but all this would do is level the playing field a bit, not harm MSFT.

And, if they have to offer another version of Windows with less features? So what, they take a one time charge for the costs involved with deleting a bunch of files (oversimplification, but it's not really that tough for them to do). All future versions of Windows could be made with a "lite" version as well. The costs aren't that great and they could actually raise prices for the full version to make up for it.

The state's proposed remedy doesn't sound that bad to me, and it would just lead to MSFT raising prices somewhat. Not that I think the states will be even modestly successful, but for worst case sakes, what's the big deal?

How exactly will the state's proposed remedies effect MSFT if by some fluke they are successful?

Dave
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