Readers Sound Off on the Microsoft Case

Do not pass Go. Do not collect 2 billion dollars.

Do not charge different PC vendors different prices for Windows. As the antitrust case against Microsoft Corp. nears its end, we recognize that Microsoft and the Justice Department aren't the only players in this grown-up Monopoly game: Every Windows user has a stake in it.

If you could decide Microsoft's fate, what would you do? We surveyed PC World readers to learn their views. Despite all the media saber rattling, less than a third of the people who responded to our poll favor breaking up the company.

And 29 percent would give Bill a get-out-of-jail-free card.

At press time, it looked as if readers who favor a moderate outcome might get their wish. Microsoft and the Justice Department were behind closed doors trying to hash out a settlement. Microsoft had reason to feel conciliatory, given U.S. District Judge Thomas Penfield Jackson's stern finding of fact in November -- saying that the software giant took advantage of a monopoly position in the OS market. Class action suits filed on behalf of California and Ohio consumers may also be influencing Microsoft: It gains more protection from these lawsuits by settling.

We the Consumers

Here's a look at what PC World readers we polled had to say about the Microsoft case, and what different scenarios might mean to PC users. We hired Research Results of Fitchburg, Massachusetts, to conduct an e-mail survey of 10,000 PC World readers. Almost 20 percent of the sample responded. (Readers could not vote more than once.)We offered five solutions to the case: Order Microsoft to end its anticompetitive practices; drop the whole matter; break Microsoft into three separate companies to handle application-, OS-, and Web-related products, respectively; order Microsoft to make the Windows source code freely available; or break Microsoft into three competing companies, each with an equal share of Microsoft's patents. Microsoft declined to comment for our story, except to say it would not agree to a solution that divided the company or took its intellectual property.

Sin No More

For months now, we've heard plenty of talk about the possible breakup of Microsoft into several "Baby Bills." But most readers we polled do not favor such a drastic remedy. The greatest number (35 percent) said that Microsoft should simply be told to stop its monopolistic practices.

"While I don't think Microsoft should be punished for its success, I also don't think it should be allowed to use that success to interfere with the ability of other companies to compete," said Lili Rodriguez, a research firm partner from Glastonbury, Connecticut. In other words, let Gates know that he's erred, but don't put him out of business.

How would this solution work? It could be costly and time-consuming for the government to monitor Microsoft's behavior. So the government is likely to avoid ongoing involvement, says Hillard Sterling, an antitrust attorney with the Chicago law firm of Gordon & Glickson.

If the court opts to spell out forbidden practices, it could bar Microsoft from striking exclusive contracts with PC companies, or it could order Microsoft to untangle Internet Explorer from the Windows OS. Alternatively, the government could require Microsoft to police itself, as it did in the 1995 consent decree-though the company didn't prove to be an exceptionally good self-watchdog that time around.

Many people think that the courts should do nothing. About 29 percent of those we polled favored dropping the case altogether. Some said Microsoft should keep what it has earned. Others argued that consumers have benefited overall from Microsoft's success. "Microsoft has gotten enough of a whack on the hand that it will most likely change the predatory practices that got it into this mess," said J. Forrest Posey, a retired professor from Buffalo.

About one-quarter of the readers polled said they felt Microsoft should be broken up; 8 percent supported splitting Microsoft into three competing software companies, with equal shares of the company's patents and intellectual property. "Even if Microsoft could be made to stop cheating, it remains far too large and powerful for real competition to develop. ... So break up Microsoft into separate businesses forced to compete against each other on all fronts," says John Brooks, who runs an import/export company in Minneapolis.

Most analysts, however, believe that this solution probably wouldn't produce a net gain for consumers in any case. "The result is that two of the companies die and one continues to live," says Michael Gartenberg, who is a vice president of the Gartner Group. "Natural market forces come into play. It's hard for three companies to stay in the same business."

More of our survey voters -- 17 percent -- liked the idea of breaking Microsoft into three separate companies controlling OS, application and Web-based efforts. "I'm not sure simply splitting the company into three pieces is enough, but it's a good start," says Trenton Fagg, a stockbroker at Wimberly Investments in Corpus Christi, Texas.

This scenario could play out in two ways for consumers. It might mean a bonanza of better software and more competition, says Anthony Picardi, senior vice president of global software at International Data Corp. But other analysts say Microsoft might enjoy a virtual monopoly in each area, in which case you would see no overall change.

Finally, 12 percent of our readers supported making the Windows source code freely available, so OS competitors could make products compatible with today's Windows apps. But this solution might not be a big consumer win, either.

Competitors would get a leg up, but Microsoft could use its vast financial resources to cut prices drastically and outlast the competition.

Judgment Day

After months of effort, judgment day approaches. The DOJ and 19 states have filed "conclusions of law," echoing Judge Jackson's findings of fact; Microsoft can respond by January 17. Thereafter, the DOJ and Microsoft can file one more response each. If the two sides do not settle, Judge Jackson could issue a ruling by March.

Interestingly, PC World survey respondents seem to have the pulse of the case.

Whether it ends with a ruling or a settlement, the outcome will probably be similar: Microsoft will have to change some of its practices. In the future, perhaps Microsoft's logo won't appear first when you boot a PC. Perhaps all computer vendors will pay the same price for Windows. And even if Microsoft gets out of jail free, the company just might be more cautious about playing the OS integration game.

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