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To: Bearded One who wrote (23513)	11/10/1999 10:44:00 AM
From: Daniel Schuh	Respond to of 24154

Prosecutors Seeking to Break the Grip of Windows System nytimes.com Drudge is a good source for what the right wants leaked, of course, always angling for a little bit of favorable pre-pub spin on things. "Breaking" a story a couple hours before it hits the street is pretty standard Drudge too, back when he stuck more to Hollywood, he always had all these "scoops" from the day's issue of "Variety". He's got "highly placed sources" on the line in various printing plants, apparently. But on to the story. With the NYT it's good to read the whole thing, of course, they always have good coverage and good writing, and my sardonic excerpts go for the funny parts more than the gist, a lot of the time. "When we started this case, we had nowhere near as specific and clear an idea how serious and far-reaching the evidence of this abuse of their monopoly would be," said Richard Blumenthal, the Attorney General of Connecticut. Maybe they didn't, though I must admit a lot of previously unknown details came out. That's sort of a convoluted sentence, though. He added: "The case showed that Microsoft's abuse of its power in the operating-system market is endemic to its conduct, and any remedy has to deal with that." Remedies is a can of worms, though. Herbert Hovenkamp, a professor at the University of Iowa College of Law who is advising the states, said: "If the findings show significant abuse of monopoly power, then the appropriate remedy is to break up the monopoly -- not to hobble the company or try to regulate it." He noted that "breaking up" a company is not such an extreme concept for the federal government. Quite often recently, the government has required companies to spin off units to win approval for a merger. The thing about a breakup, you got to figure out one that does some good. The OS/App line just gives you two interdependent lesser monopolies, as noted below. Here, apparently, are the remedies being floated. As usual on remedies, no further comment from me, beyond the can of worms line. Among the conduct guarantees under discussion are proposals to force Microsoft to charge every computer maker the same price for Windows, so that it could not impose higher prices to punish rivals or those that do business with them. Such a proposal would also have to include clear guidelines on what Microsoft products and services it could build into Windows, government officials say. But those ideas would require constant regulatory scrutiny that many government officials oppose. The Justice Department and the states have not said how they will resolve these issues. The officials say four other remedies are under discussion, though each could be applied in a variety of ways and might be combined with elements of others. Not surprisingly, Microsoft said it opposed all of them. One idea would be to force Microsoft to publish the secret, proprietary source code that makes up the Windows operating system. The goal would be to let other software developers design competing operating systems that are compatible with Windows and the many thousands of programs that are written for it. In the early 1990's, when IBM was trying to sell OS/2, its operating system, the company said it was stymied because software companies were unwilling to rewrite their programs for OS/2. Without access to the Windows source code, IBM could not make OS/2 compatible with the existing library of programs written for Windows. Another idea long favored by the states would be to force Microsoft to auction the Windows source code so that two or three other companies could sell competing systems. In that case, Hovenkamp noted, the competing companies would have to set up a "joint venture for compatibility standards" so that computers and software would work equally well with each system. In addition, the officials are reviewing two proposals for breaking up Microsoft. One would split it into several equal parts; each new company would hold all the software code and intellectual property from Microsoft products. But they would begin competing with each other. A final alternative is breaking Microsoft into three companies, one controlling its operating system; one its applications programs, like Word and Excel; and the third its Internet and related businesses. The problem with this idea is that one company would retain an operating system monopoly. And even if this company's business were limited to selling operating systems, it could still bundle other products with the operating system -- the very problem that initiated Microsoft's current problems with the government. Monitoring that would also require continuing government involvement, something no one in state or federal governments want.