Judge Ready to Hand Down Microsoft Ruling

BOSTON (06/07/2000) - Microsoft Corp.'s fate today will be decided by the federal judge that has presided over the nearly 2-year old antitrust case against the software giant and his decision is likely to include breaking up the company.

Microsoft plans to immediately appeal the decision, which could extend the case for years to come.

A memorandum released by the court early this morning said the judgment would be "made available to the public, in both electronic and paper form, beginning at 3 p.m. eastern daylight time."

The judgement will conclude a remedies phase that began April 3 when Judge Thomas Penfield Jackson ruled that Microsoft was a monopoly and had wielded that monopoly power to bully competitors and partners, and enter other markets, most notably for browsing software.

The U.S. Department of Justice, who along with 19 states brought the case against Microsoft in May of 1998, has proposed breaking Microsoft into two companies, one focused on the operating system and one focused on applications.

Microsoft vehemently opposes such a plan, which company CEO Steve Ballmer has called "reckless beyond belief."

Government supporters say a break up will return competition to the market place and eventually benefit consumers.

Ballmer this week reiterated that Microsoft is confident it can win on appeal, confirming that the software giant fully expects the judge to rule for a breakup.

Chairman Bill Gates has said a breakup would make it nearly impossible for the company to execute its Next Generation Windows Services (NGWS) strategy, which is designed to turn Windows into a platform for the Internet where applications can be hosted and accessed by any device. Microsoft last week delayed for three weeks its rollout of NGWS, but this week began revealing some of the strategy's details at its TechEd conference in Orlando.

Two weeks ago, during oral arguments, Jackson admonished the government for not going far enough in its plans for a breakup and suggested that breaking the company into three parts would be a more effective remedy.

The judge asked the government to submit a revised proposal for penalties, but the revision did not change the recommendation to split the company into only two parts.

In early morning trading, shares of Microsoft were off 1 9/16 at 68 1/16.

Nearly 6.7 million share have already been traded today.

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