Keep Microsoft Bundled Up

President Bush's trustbusters face difficult choices in coming up with new remedies for Microsoft's past monopolistic practices.

The cursor is now blinking on the government's screen after last week's ruling by a United States appeals court. It confirmed a lower court finding that the software giant had indeed used its market clout in computer operating systems to engage in anticompetitive behavior.

But the higher court also threw out the lower court's easy and drastic fix - breaking the company in two - and asked for more proof of how the software market was harmed.

The Justice Department now can either renew the court hearings or negotiate a settlement. Having won on the primary point of guilt, the government has gained enough legal momentum to resume the hearings, even if the process takes a couple more years.

Given Microsoft's political clout in Washington and Mr. Bush's skepticism about this case from the start, a settlement would never be acceptable to much of the public.

A settlement might seem attractive in order to influence Microsoft's final design of a wholly new operating system, known as Windows XP, to be released in October. The software comes bundled with many new features that may help Microsoft conquer other markets.

Already the company has pulled one feature, called SmartTags, out of XP, after competitors claimed it would allow the company to again unfairly use Windows' dominance to hurt competition.

Any remedy other than a breakup of Microsoft might entail long-term government monitoring of the company, which has its own problems. Still, one solution that the courts might endorse would force Microsoft to release the code of its operating system, thus ending the monopoly in its primary product.

But that option awaits the government's key decision: whether to settle or seek a court remedy. For now, the latter has more advantages for all.

(c) Copyright 2001. The Christian Science Monitor

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