The software giant Microsoft has been freed to extend its influence over new technologies, say analysts, following a court ruling that endorses a limited punishment for the company鈥檚 previous monopolistic behaviour.
The four-year court battle between Microsoft and the US Justice Department has focused on Microsoft鈥檚 efforts to damage competitors using the dominance of its Windows operating system. In June 2000, a US federal judge ruled that Microsoft had acted as a monopoly to gain an unfair advantage. In the 1990s Microsoft bundled the Internet Explorer web browser with Windows to draw users away from the competing Netscape browser.
But the Court鈥檚 recommendation that Microsoft be split in two was rejected on appeal. On Friday US district judge Colleen Kollar-Kotelly approved an alternative settlement proposed in November 2001. This requires Microsoft to provide versions of Windows that can be customised to feature competing software.
Advertisement
Half the 18 states involved in the anti-trust case had wanted a tougher settlement, arguing that Microsoft should be forced to reveal the source code used to build its software. But the latest ruling has been described by some legal experts as effectively appeal-proof.
鈥淪ystemic failure鈥�
Some industry figures were scathing. 鈥淭his represents a systemic failure of the legal system, a failure to protect consumers, competition and companies like Netscape whose innovations literally changed the world,鈥� said Mike Pettit, president of the trade group ProComp.
But Bill Gates, Microsoft鈥檚 co-founder and chief software architect, said: 鈥淲hile putting new responsibilities on us, this settlement also gives us the freedom to keep innovating for our customers.鈥�
鈥淲e have only scratched the surface of what software can do in our homes, our schools and our economy,鈥� he said.
Emerging technologies
Senior IDC analyst Dan Kusnetzky predicts Microsoft will now focus on extending its reach into emerging technologies.
鈥淚f anything I expect them to become more aggressive,鈥� he told New Scientist. 鈥淭hey鈥檒l find ways to tie Windows to many other areas of technology so that they can use the dominance of Windows as a way to encourage people to use their other software products.鈥�
Kusnetzky says Microsoft may seek to tie Windows to wireless technologies and embed a simplified version of the operating system into more diverse hardware, perhaps including cars and refrigerators.
Back to court
But Microsoft may continue to be at least partly occupied in court. Some competing software companies such as Sun Microsystems and AOL may now launch private court cases against Microsoft for monopolistic activity.
The European Union鈥檚 Competition Commission is currently investigating allegations of monopolistic activities in Europe. The Commission is expected to make a ruling by the end of 2002.
Details of Judge Kollar-Kotelly鈥檚 ruling were supposed to remain secret until the end of stock market trading in New York on Friday. But they were accidentally revealed on the court鈥檚 web site. This caused a flurry of trading in Microsoft鈥檚 stocks and the company鈥檚 share price continued to rise on Monday.