Microsoft's Weekend Olive Branch Wilts

SAN FRANCISCO (03/28/2000) - Watchers on both sides of the antitrust action doubt Microsoft Corp.'s reported concession offer will close the case.

It seems Microsoft will lose little besides lawyers' fees despite the concessions it reportedly offered to settle its antitrust case this past weekend.

Microsoft reportedly told the U.S. Justice Department it would sell a version of Windows sans Web browser. Also, other vendors could tinker with the coveted Windows operating system code, so third parties can more easily develop Windows programs.

Microsoft apparently also offers to charge all vendors the same price for Windows. PC makers have long complained Microsoft plays favorites through preferential pricing.

But Microsoft-bashers shouldn't raise their hopes too high. Even as the contentious antitrust case approaches a critical juncture, pundits predict Windows (and Microsoft) won't change.

First, even if the plaintiffs (the Justice Department and 19 states) scoff at Microsoft's offer, leaving presiding Judge Thomas Penfield Jackson to hand down a harsh punishment, Microsoft promises to take its legal battle to the U.S.

Supreme Court.

And even if Microsoft's concessions prompt a settlement, it will be business as usual for the software behemoth, experts say.

Heal Thyself, Microsoft

Some observers say Microsoft's offer signals it is finally serious about a settlement. Others say the measures don't go far enough.

Microsoft's offer actually concedes little, says Jeff Tarter, publisher of Softletter, a software industry newsletter.

"If the Justice Department bites on Microsoft's concessions, then they're dumber than I think they are," Tarter says. "It is a foregone conclusion that [the judge] is going to rule against [Microsoft]. So why should Microsoft appease a judge who has already got his mind set up?"

Microsoft's concessions don't go far, agrees Bob Lande, director of the American Antitrust Institute. He advocates the government crack down on Microsoft lest it continue to compete unfairly.

"The browser war is over," Lande says. "It's a meaningless squabble ...

Netscape is withering on the vine, and no matter what Microsoft does, nothing is going to change that."

He suggests Microsoft be drawn and quartered into separate divisions to protect the market from future monopoly attempts.

Another antitrust expert, Professor Michael E. DeBow of Samford University's Cumberland School of Law, disagrees. Antitrust action could hamper a young industry, he warns.

"My concern is that what consumers will get is a Microsoft that is less innovative and aggressive than it might have otherwise been," DeBow says.

The Ever-Changing Market

Tarter and others say it's too late to try to correct the software giant's behavior. The Internet and a crop of non-Windows computing devices are fast reshaping the industry and already weaken Microsoft's dominance.

"New players like Linux, Palm, and game consoles are starting to chew big holes in the Windows monopoly," Tarter says.

And as for the price of Windows, skeptics say Microsoft will always find a way to bully the competition. If Windows carries a set cost, PC prices will probably rise, DeBow says.

By opening Windows source code, government is "opening a swamp" and could find itself in the unwieldy position of monitoring Windows' source code specs, DeBow adds.

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