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To: gbh who wrote (46123)	5/6/1998 7:21:00 AM
From: Glenn D. Rudolph	Respond to of 61433

****OT***** Microsoft CEO takes Windows 98 case to the public Reuters Story - May 05, 1998 22:14 %DPR %US %RET %BUS %ENT MSFT CPQ CPU V%REUTER P%RTR (New throughout, adds byline, reaction) By Richard Melville NEW YORK, May 5 (Reuters) - Microsoft Corp. Chairman Bill Gates, whose company is the target of several antitrust investigations, warned on Tuesday that any government action to block release of its Windows 98 operating system software could hurt the U.S. economy and cost jobs. Flanked by a phalanx of computer industry executives, Gates warned such a move against the newest version of the company's flagship software would hamper innovation and could have a devastating effect in and beyond the computer industry. "Any government action that would derail or delay Windows 98 would hurt the American economy and would cost American jobs," Gates said at a "rally" organized by Microsoft at New York City's Equitable Building. "The effect would be profound and would ripple through the economy." The speech was Gates' most direct response to what he called the "serious consideration" government attorneys are giving to a plan to delay Windows 98. To buttress his case, Gates turned to several top industry executives, including Eckhard Pfeiffer, president of Compaq Computer Corp. , the world's biggest personal computer maker. Pfeiffer said Compaq and the entire PC industry had "a large stake in the introduction and success of Windows 98," a product many industry executive hope will help spark new life into recently sluggish sales growth. Pfeiffer and computer retailer CompUSA Inc. Chief Executive Jim Halpin also noted that many companies have already sunk millions of dollars into early marketing efforts linked to the June 25 scheduled release of Windows 98. But the display of solidarity was immediately seized on by opponents who assembled outside to argue the affair was more evidence of Microsoft's grip on the computer industry. "When you are that reliant on a company that has a stranglehold, it's not surprising that you would go along," said Ed Black, president of the Computer & Communications Industry Association, a Washington-based industry lobby representing Microsoft's foes. Connecticut Attorney General Richard Blumenthal echoed those sentiments in a statement released after the rally. Blumenthal, who last week said he and 12 other state attorneys general were "on the cusp" of bringing an antitrust lawsuit against Microsoft, declined to say on Tuesday exactly what action the states were considering. However, he did say the argument that Windows 98 is "absolutely essential" to the PC industry would "seem to support the view that Microsoft has excessive dominance that constitutes a stranglehold." A federal lawsuit against Microsoft is also a possibility, and some believe the states and federal government could move jointly against the Redmond, Wash.-based software giant. In seeking to rebut the argument of his company's power over the marketplace, Gates steered the focus repeatedly to the topic of innovation rather than focus on the topic of whether or not Microsoft enjoyed monopoly status. A demonstration of the software that preceded Gates's remarks -- and which went without a hitch, in contrast to a recent crash-plagued demo handled by Gates himself in Chicago -- highlighted some of the new Windows features designed to address the needs of disabled customers. One such feature allows users to magnify parts of the screen for easy reading, for example. Microsoft also introduced Gregory Mankiw, a Harvard University economics professor, who argued against government involvement in the computer industry. "The computer industry is not broke, and the government should not try to fix it," Mankiw said, adding intervention would be like "throwing sand in the gears" of progress.