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To: Dwight E. Karlsen who wrote (19143)	5/16/1998 11:52:00 PM
From: Daniel Schuh	Read Replies (2) \| Respond to of 24154

Microsoft Talks Collapse nytimes.com The good gray Times weighs in again. Their spin is a world away from what's hitting the trade rags and the WSJ, much more in line with Gerald's original story. Very interesting indeed. It couldn't be that the source for the trade rags and WSJ was from Bill's side of the table? Nah, that's impossible. Negotiations between the Microsoft Corp. and state and federal justice officials collapsed on Saturday afternoon, apparently after the company's chairman, Bill Gates, ordered lawyers to withdraw earlier concessions. Justice Department officials said that they intended to file a sweeping antitrust suit on Monday. Good to see Bill acting as his own lawyer again. I won't repeat the old saw. A senior government official involved with talks said they fell apart "because Microsoft didn't put anything of substance on the table." Microsoft, on the other hand, said that it had made "extremely far reaching concessions in the area of contracts with Internet service providers." Note the careful wording and very limited scope there. Maybe Microsoft offered what they'd done for the EU months ago. Talks opened at the Justice Department on Friday and continued on Saturday in the offices of Microsoft's Washington law firm, Sullivan & Cromwell. Two senior government officials who were involved with the talks said that Microsoft, on order of Gates, had retracted some of the concessions it had put forward the day before. "They said that, on reflection, Bill Gates had expressed an unwillingness to do what they had said they were willing to do before," one of the officials said. I'd say it's appropriate that the negotiations foundered on the issue of the integrity and uniformity of the Windows experience. After the talks broke down on Saturday afternoon, Gates said: "Microsoft will continue to vigorously defend the right of every American company to innovate and continually improve its products for consumers. We cannot compromise on this principle." The company insists that integrating products in Windows is the key to innovation. The key to "innovation", as in innovative Microsoft standard business practice, necessary for cutting off the relevant air supply. Microsoft must be free to clone, copy and give away! A senior government official who was briefed on the discussions said: "Some of the attorneys general got the feeling that Microsoft was just fooling around, trying to learn as much as possible about what we planned to do. They really failed to make any substantive offers. And we're not in the mood to be jerked around anymore." Even if the Microspun stories were correct, and the government engaged in some hardball negotiating, it'd be difficult to be too sympathetic, given Microsoft's well deserved reputation for playing hardball with everybody else and the 11th-hour "compromise" offer. Personally, I'm happy to see the O.J. trial for the technoweenie set go into extended production. Cheers, Dan.