Sun's McNealy speaks at National Press Club

Sun Microsystems Inc. Chairman and Chief Executive Officer Scott McNealy today said he believes Microsoft Corp. continues to leverage its monopoly in desktop operating systems by investing in an assortment of companies, including content and infrastructure providers, and this is bad for consumers because it limits choice and stifles innovation.

McNealy, speaking at the National Press Club here, pointed to Microsoft, said the company was leveraging its dominance into MSN, its server business, set-top boxes, content and computer games, and taking large stakes in AT&T Corp., Nextel Communications Inc. and possibly DirecTV.

"We've got a problem right now. I think choice, and having consumer choice and innovation put back into the technology industry will be very, very critical," McNealy said.

A vocal supporter of the US Department of Justice's antitrust case against Microsoft, McNealy said he wouldn't oppose a settlement of the case "as long as they put consumer choice and innovation back into the system." Microsoft's appeal of the judgment issued against it last year by US District Court Judge Thomas Penfield Jackson will be heard in Washington at the end of February. But McNealy said to him it's clear that Microsoft's actions were illegal.

"I believe anybody who sits down and rationally takes a good hard look at (the case) comes to the same conclusion that the judge came to. This is clearly anticompetitive behavior that is bad for the consumer, " McNealy said. "This is not an emotional issue, this is not a political issue. It's not a financial issue. This is absolutely about putting competition and choice and innovation into, I think, one of the most critically enabling technologies."

(more to follow)

Sun Microsystems, in Santa Clara, California, can be reached at +1-650-960-1300 or at