Winners and Losers In Microsoft Lawsuit

Imagine, if you will, that we are now four or five years in the future, the day the Supreme Court of the United States issues its decision in the Microsoft v. Justice Department antitrust lawsuit.

After battling through the lower courts for years, the historic case was taken up by the Supreme Court, knowing it would rewrite antitrust legislation for the 21st century. But what will the court's decision be?

We can't know that, of course. After all, the first salvos were fired in front of US District Judge Thomas Penfield Jackson last Monday in Washington. But based on the statements of both sides, we can probably count on the case making it to the highest court in the land.

Microsoft will fight any outcome that favors the Justice Department in the smallest way. For instance, Microsoft convinced a federal appeals court that Judge Jackson's earlier injunction on the integration of the Windows operating system and Internet Explorer browser should not apply to Windows98.

Later, the same court both removed Mr. Jackson's original injunction against the integration of Explorer and Windows95 and told Jackson to revoke Harvard Prof. Lawrence Lessig's status as a specialist in the case because of an alleged bias against Microsoft.

The Justice Department will probably do the same if the outcome favors Microsoft, or if it feels the court doesn't go far enough to punish the software giant for, in the words of Jackson, "maintaining its operating systems through exclusionary and predatory conduct."

So what are the possible outcomes, and how will each affect us and how we use our computers?

1. Microsoft wins on all important points.

This ruling basically gives Microsoft the legal OK to continue its current direction. Look for Microsoft to snap up more innovative companies in Internet-related areas, as it moves swiftly into areas like online banking and electronic transactions. This decision also means higher costs for both the individual and businesses, say Microsoft opponents, since Microsoft will be able to control the pace of innovation almost single-handedly for years to come and ensure that all programs must work with its programs. A pro-Microsoft ruling will probably force the issue decisively into the political arena, as politicians have shown signs of being uncomfortable with the incredible wealth of Microsoft and its president, Bill Gates.

2. A split decision.

This ruling would still favor Microsoft, since it would probably not resolve the underlying issues. Competitors would be hesitant to wage another costly legal battle with the software giant since it has shown itself to be adept at finding legal loopholes in split decisions.

Whether this decision would result in lower prices and more choice for consumers depends on how the court ruled on Microsoft's control of the desktop operating system, but it's likely that not much would change. Technology companies' destiny would become more political, necessitating more lobbying.

3. The Justice Department wins on all important points.

If the Justice Department wins, things get interesting. There is a chance, however slim, that the Justice Department could convince the court that Microsoft should be broken up into three companies: one that sells operating systems, one that creates other kinds of software for other programs, and one that sells browsers and Internet-related products for e-commerce or business on the internet.

On the one hand, it would lead to lower costs and more choice at the retail level. On the other hand, it could have a negative effect on the stock market, as technology companies - the engine of the stock-market boom - struggle to determine the ground rules in the new legal environment.

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