Users Unsure of Benefits if Microsoft, DOJ Settle

WASHINGTON (03/30/2000) - If negotiators succeed in reaching a settlement next week in the Microsoft Corp. antitrust case, it could bring some fairly rapid changes but also mixed blessings for users.

The moment of truth in the case is rapidly arriving. Trial Judge Thomas Penfield Jackson may release a verdict as early as late next week if no settlement is reached before then. Both sides are meeting in Chicago with a court-appointed mediator.

Jackson has set a midweek deadline for closing negotiations. But he will extend it if both sides are making progress. The judge is trying to motivate both parties to work by setting this deadline, with the verdict "on ice" ready to be delivered if these talks break down, said one person close to the case.

An out-of-court settlement would involve changes to Microsoft's conduct, not a breakup of the company. And as a result, most experts and people close to this case expect that any settlement would focus heavily on making it easier for independent developers to write applications to Microsoft's Windows operating system. Developers and end users see benefits to this but also problems.

"The only thing that is really going to help any developer is if they open up the operating system," said Bill Fitts, director of application development at Continuum Health Partners Inc. in New York. "That's the only decision that is going to make any difference in this lawsuit."

By opening the Windows source code, developers will have new options to improve the performance of applications on the operating system, said Fitts.

"Third-party software will get better," he said.

A settlement may well require Microsoft to guarantee exposure of its operating system APIs (application programming interfaces), the links that let applications work with the operating system, along with opening some of the Windows source code so third-party developers have access to the underlying Windows technology. Microsoft says its APIs are already available, but some developers complain that they sometimes don't have enough documentation to help them use the APIs.

But Alan Sauerbrei, the information systems manager at Wright Brand Foods Inc., a processor and distributor in Vernon, Texas, said that if developers change the operating system source code so the OS works better with their applications, it could create system conflicts.

"One vendor makes a slight change (to the operating system), and it clobbers another vendor's software," said Sauerbrei.

Toney Fidler, the IS director at Cantex Inc., a pipe manufacturing company in Mineral Wells, Texas, said a settlement that opens source code would make third-party applications cleaner. "We have a lot more problems with non-Microsoft products."

But Fidler, who favors breaking up the company, doesn't believe an out-of-court settlement will bring any changes to Microsoft's behavior.

"I don't think it'll mean a whole lot if they have an out-of-court settlement; I don't think it'll affect the day-to-day operation of Microsoft at all," said Fidler.

If no settlement is reached, it will take two or three years before the appeals are completed.

One of the goals of any settlement, would be to prevent some of the problems Netscape Communications Corp. faced when it was developing a browser for the then-new Windows 95 operating system, said experts. The company accused Microsoft of delaying that work by withholding technical information. But solving that problem may require more then opening up the source code and guaranteeing access to APIs.

Part of the U.S. government claim against Microsoft was that it illegally "tied" its browser to the operating system to crush Netscape. The company denies that. But preventing future tying may prompt the government, in the absence of a breakup, to have ongoing oversight over what Microsoft may or may not be able to do with its operating system.

Microsoft has refused to settle any case that hinges on its "ability to innovate" its products. In a letter to employees this week, obtained by The Washington Post, Microsoft Chief Executive Officer Steve Ballmer said there were limits to what the company would be willing to accept in a settlement. "We believe we've put more on the table than the judicial process would ultimately provide, even if we lost the case," Ballmer wrote.