RealTime IT News

Microsoft Files Final Response

In its last volley against a plan to break the company in two, Microsoft Corp. Wednesday offered a number of modifications to the government's proposal.

The software giant Wednesday filed the final arguments before U.S. District Judge Thomas Penfield Jackson makes his ruling on the case. That ruling could come as early as Thursday.

Microsoft's suggested modifications included giving it 12 months instead of four as the government suggested to submit a plan of divestiture. Microsoft also wants to quash most government oversight of the new company which would be carved out of the software maker's applications, including Microsoft Office.

Microsoft cut some of the government's provisions and changed others in its line-by-line critique.

The company objected to publishing its prices on the Web. The company said there was "no reason why (the prices) should be published to the world, including Microsoft's competitors."

Microsoft also proposed charging companies for looking at its source code, which the government said it proposed to help others write compatible software.

Microsoft opposed price reductions when software functions are disabled, arguing functions that are not available are "still providing value."

The company proposed stretching out many deadlines in the plan, citing a variety of reasons. For example, the company said a split may require "approval from certain foreign governments. Obtaining such approvals is a time-consuming process."

At the same time, it proposed reducing the duration of conduct restrictions -- which remain in effect for 10 years if the firm is not broken up -- down to four years.

The Microsoft filing hammered away at the government for what it said was vagueness in its definitions.

"There must be a definition of the term 'Internet browser,'" the company said in one instance. "At the moment there is no indication of what the government is referring to."

And it took issue with another matter of definitions. Microsoft said the plan to break up the company should be called a "divestiture" and not a "reorganization."

The filing came after Jackson ruled on April 3 that the company engaged in anticompetitive practices that violated the nation's antitrust laws. Following that ruling, Justice and 17 of the 19 states involved in the lawsuit proposed splitting the company in two. One company would market and develop operating systems and the other software applications.

In a symbolic move, Microsoft offered testimony from several company executives which it said disagreed with the government's plans. Among those Microsoft cited as supporters were Compaq Computer Corp. Michael Capellas, University of Chicago Professor Steven Davis, Dreamworks founder Jeffery Katzenberg, enterprise software maker J.D. Edwards chief Edward Mcvaney and Nordstrom Inc. chief John Whitacre.

The move will likely have no impact on the case since no additional witnesses can be called.

(Reuters contributed to this report).