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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: limtex who wrote (16072)	2/15/1999 7:08:00 PM
From: t2	Read Replies (2) \| Respond to of 74651

Here is my brief assessment of RTR's article on Remedies for MSFT. dailynews.yahoo.com (Para 3 and 4 have been added) I have reproduced parts of the story below: WASHINGTON (Reuters) - The U.S. Justice Department and representatives of 19 states are pondering possible remedies if they win their antitrust case against Microsoft Corp. (Nasdaq:MSFT - news) -- from breaking up the company to ordering it to cease violating the law, sources said Monday. Cease violating the law sounds like a reasonable solution if they lose, punishment fitting the "crime". The Washington Post said in Monday's editions that several possible sanctions were under consideration but no decisions had been made. People close to the case said that was true and outlined what those possible solutions were. Now that might make the judge upset(and potential appeals court judges); Getting to remedies even before getting a win from Jackson. MSFT's chances have just gone up at trial and appeals level. A Justice Department official reacted strongly to the report, saying: ''The trial is ongoing. Speculation about what the department might do if the court rules in our favor is premature and inappropriate.'' Microsoft spokesman Jim Cullinan said it was ''clear from comments both in and outside the courtroom that the government is interested in getting involved in the design of software.'' He said a U.S. Court of Appeals decision last year in Microsoft's favor and against the government showed ''that is not in the interest of consumers.'' Another blunder by the government--counting your chickens before they hatch. This is the kind of thing that causes people's feeling to change---just look at Clinton and how popular he got. Don't mean to compare, but i see it happening. The political leaders won't have the will to allow such action. Not in the interest of consumers is the key as well. But Microsoft says that much of what people see in the courtroom is little more than theatrics and that its case is stronger than some observers believe. General counsel William Neukom has said repeatedly that the government has failed to attack most of the assertions its witnesses made in direct written testimony, which is the bulk of its case. Further, company officials say those assertions are backed up with documentary evidence. Experts say if that is so then the company could be in a strong position at either the trial or appellate court level. This is not a case where someone is charged with a high crime and people reactions on the witness stand really don't matter. The written testimony backed up by the appeals court (wrt Windows95) is more important---Obviously. Just doesn't get much media coverage. If Jackson ignores the written testimony and focusses mostly on witnesses, he is going to look stupid in the eyes of the appeals court judges. Prosecutors could seek a one-time structural change or take a regulatory approach. Justice Department Antitrust Division chief Joel Klein has in the past expressed a preference for one-time solutions that avoid continuing oversight and keep the government out of decisions better made by the market in the country's fast-moving high-tech industries. Joel Klein should drop the case if he feels that the market is better at making decisions. If he feels that way--don't expect him to recommend a breakup or licensing of windows. Expect him to favor a fine and some concessions from MSFT. One structural approach would break the company into several identical ''Baby Bills,'' each with complete copies of Microsoft's intellectual property. That approach has been endorsed by former Judge Robert Bork, an antitrust expert who advocates breaking the company into three pieces. Bork works for Netscape as a lobbyist. Larry Ellison favored the same approach. It is obvious that competitors are interested in this type of solution. It would become apparent to everyone that it is not a solution---will take forever in the courts and won't stand. If MSFT was to break up, I bet the court would favor a reasonable method such as O/S and Applications--that too would be a long process the government will lose. The government could take a more regulatory approach by requiring Microsoft to license its secret ''source code'' to competitors. That solution was less than fully successful when the Federal Trade Commission forced Xerox Corp. (NYSE:XRX - news) to license its copier patents in 1975, and opens the door to contentious arguments over the conditions and costs of licensing. Not a good solution. The weakest regulatory approach would be for the judge to order the company to cease business practices the government contends are illegal. The government reached an agreement with Microsoft in 1995 to prohibit certain business practices, but lost an important round in the appellate court when it tried to enforce that agreement in 1997. That is the answer folks. It is the only one that will stick in all levels of court. It is one that both parties can agree upon and not fight it out in the appeals courts--a solution similiar to Windows95. Remember the DOJ lost.

To: limtex who wrote (16072)	2/15/1999 8:36:00 PM
From: RTev	Read Replies (1) \| Respond to of 74651

Now we have a case based on an assumotion tha the browser is important. It isn't. You may think it's unimportant, but I assure you, Microsoft knows it's important. I have heard both Bill Gates and Steve Ballmer give speeches where they pounded away at that point (well... Ballmer pounded as is his wont. Gates stated firmly). Microsoft saw Netscape's browser and their plans for it as a serious threat to the dominance of the Windows platform. Microsoft's leaders are smart guys. It's clear that they knew they faced a risk of a trial like the one they're in now if they used the Windows franchise to get the browser market. But they also saw even greater dangers ahead if they didn't. Since you use AOL, you might not realize what the "internet experience" is like for the other 50% of us who don't. There's no extra software needed to get onto the net. If you have an ISP account, Windows includes everything else needed to get on the net. When I'm on the internet using a modem, there's nothing to tell me that I'm online except a little icon in the system tray (and even that's optional). If I want to do something, I have to launch the appropriate program -- a browser to see web pages, an ftp program to transfer files, a mail program to get and send email, a telnet client to connect to another machine. The problem with the browser, as Netscape envisioned its future, is that it was seen as an applications platform separate from Windows.

To: limtex who wrote (16072)	2/15/1999 11:46:00 PM
From: ToySoldier	Read Replies (1) \| Respond to of 74651

Limtex, I will assume that you have limited knowledge of the Technology Sector. To say that the browser is not important is a completely naive statement. Fort he sake of MSFT's competitors, they would only wish that MSFT were as naive as you on the importance of the Browser, but unfortunately MSFT competitors, MSFT is not stupid. The browsers may not mean squat for you the average job-blow home computer user, but to the industry players it is very strategic. The browsers are the main portals to the Internet. The better the control of this portal, the more influential you are in controling how the Internet services are run and how standards for use on the Internet are developed and matured. If MSFT was to have any major influence on the Internet, it needed (and still needs) to have a strong position of the browser market. A perfect example of this is Java. If MSFT did not have any browser market presence, Java would not be encountering the rough road to maturity that MSFT has generated for it. Now that the court case has forced MSFT to behave regarding Java the road will be much smoother, but before that trial, MSFT had caused a lot of trouble for Java's development. Not to mention the fact that you have no care for the fact that an innovative little startup company was being crushed by a monopolistic industry bully (MSFT) who decided that Netscape had a good thing here and they needed to steal that marketshare away. Maybe in the short term you dont really care that MSFT broke anti-trust laws to take that marketshare from Netscape, but you would have cared if you worked for Netscape and you will care if MSFT continues to stifle new and as-of-yet unheardof innovative companies that creates most of the technology that you currently use on your computer. Let me ask you a question to see how well you know your facts, how much of the MSFT technology (i.e. software and even hardware) that you use today do you think MSFT invented or concieved of? I think you will be quite shocked if I tell you that its likely about less than 10%. If MSFT is continued to be allowed to crush these innovative startups, where do you think the next major Internet innovation will come from? Sure as heck not from MSFT. After all, the MSFt slogan that was properly mutated to better fit the company was: MSFT needs the freedom to Intimidate, uhmmm, not Imitate, no ahh, Innovate - yeah thats right! Toy