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States: Make Microsoft Open Windows Code

At long last, the end may be in sight in the four-year legal battle between Microsoft Corp. and the government.

A federal court judge heard closing arguments today in the antitrust fight between Microsoft and the nine holdout states, after she opened the window to a possible compromise by telling the two sides to modify their proposed remedies.

"Prioritize the various provisions in your own remedy proposal, indicating which provisions are integral to the proposal's effectiveness and which are less significant," U.S. District Court Judge Colleen Kollar-Kotelly told both sides in a written order issued Tuesday.

Steve Kuney, an attorney for the states, said their highest priority was Microsoft giving its source code to competitors, according to press reports. He ranked that remedy higher than the state' request that the court require Microsoft to release a stripped-down version of its Windows operating system.

Microsoft attorney John Warden argued the states' proposals are extreme and any remedy should follow the settlement the Redmond, Wash., company worked out with the Justice Department last fall, Reuters reported.

After 32 days of testimony over four months, both sides covered well-trod ground summing up their cases. The states painted Microsoft as an unrepentant monopolist, bent on using its dominant position to stifle innovation. Microsoft, meanwhile, lashed out at the states for proposing extreme punishments that far exceeded any antitrust violations.

Judge Kollar-Kotelly expects to have a verdict later this summer.

In her order for the two sides to rank their remedy proposals, Judge Kollar-Kotelly stressed that her questions were areas she would like touched upon and should not be construed as a clue to how she will rule.

"These questions are not intended to derail or supersede the parties' prepared arguments," she said, "but instead to raise matters which the court would like to discuss briefly with the parties before the conclusion of the proceedings in this case."

In another development on the eve of closing arguments, Microsoft announced yesterday that, in 2004, Windows would cease supporting the Java programming language developed by longtime rival Sun Microsystems. Current versions of Windows XP do not include Java, but users can download it. Microsoft said it plans to include temporary support for Java in an update slated for release this fall.

Sun has long been a thorn in Microsoft's side, with Chairman and CEO Scott McNealy one of Microsoft's earliest and most vocal critics. Sun has filed a barrage of private lawsuits against Microsoft, in addition to pushing the federal government to bring its own antitrust case. Last June, a federal appeals court ruled Microsoft had used its Windows monopoly to squelch the development of Java.

Closing arguments in the case are set to come a little more than six months after Microsoft and the U.S. Department of Justice reached a settlement that would not break up the company, as the original trial court ruled. Instead, the settlement called for an independent commission to monitor the company but required few changes to its business model. However, half of the 18 states joining the federal government in the suit demurred, saying the settlement favored Microsoft.

Those nine states refused to sign the settlement, instead continuing the litigation to push for broader restrictions on how Microsoft tied together its middleware products, like Internet Explorer and Windows Media Player, with its flagship operating system Windows.

In March, in the remedy phase of the antitrust trial that ended in September 1999, the states have kept the heat on Microsoft. Lead attorney Brendan Sullivan argued Microsoft should be compelled to offer a stripped-down Windows, shorn of middleware like IE, Media Player, and MSN Messenger.

In response, Microsoft Chairman and Chief Software Architect Bill Gates took the stand in April, testifying such a remedy "would undermine all three elements of Microsoft's success, causing great damage to Microsoft, other companies that build upon Microsoft's products, and the businesses and consumers that use PC software."

Last week, Judge Kollar-Kotelly rejected Microsoft's bid to have the case dismissed because the states could not sue in federal count or prove the company specifically harmed their citizens.