Court plays spoilsport in MS win

WASHINGTON: The U.S. Justice Department told a federal judge that Microsoft still hasn't fully complied with a key provision in its landmark antitrust settlement with the government.

In a report to the judge, attorneys with the department said they "remain concerned" about the price Microsoft plans to charge competitors to view the inner workings of the Windows program, a requirement under the antitrust settlement.

The department is still not satisfied with the royalty structure and rates Microsoft has proposed to charge for access to computer code needed to make server software function properly with the Windows operating system.

The licensing terms could be important to companies such as Sun Microsystems Inc. that are battling Microsoft in the market for software that run servers, the powerful machines that manage computer networks.

Thursday's report to U.S. District Judge Colleen Kollar-Kotelly was aimed at keeping the judge updated on Microsoft's compliance with the settlement.

As part of the settlement, Microsoft had promised to license he code, or protocols, on "reasonable and non-discriminatory" terms.

However, Microsoft rivals, who opposed the settlement, have since complained to the department that the licensing terms are anything but reasonable. In April, under pressure from the department, Microsoft said it had agreed to make it cheaper and easier for competitors to license the code.

Microsoft spokesman Jim Desler said that the company has complied with the settlement, but "is open to considering additional feedback from government and industry."

"We've worked together and made some initial changes to this complex and unprecedented program and we will continue to work together," Desler said.

The Justice Department told the judge that complaints about the license terms made up the majority of the 18 "substantive" complaints about Microsoft compliance.

The department is particularly concerned that competitors have access to the server protocols because the provision is -- in the judge's words -- the most "forward-looking" part of the settlement, which is designed to restore competition.

The department quoted further from Kollar-Kotelly's opinion in the case, saying the settlement could end up "prematurely obsolete" without licensing the code under reasonable terms.

The Justice Department agreed to the settlement in November 2001, saying the business restrictions in it would restore competition to the software business and prevent Microsoft from engaging in anti-competitive tactics.

The settlement, endorsed a year later by Kollar-Kotelly, resolved findings that the company abused its monopoly in personal computer operating systems.

Ken Wasch, head of the Software & Information Industry Association, said problems with the license terms are no surprise .

Of the four companies that have agreed to license the server protocols, Wasch said, none compete directly with Microsoft. "The disclosure of these protocols is a critical part of what the government claims it won from Microsoft in the settlement, and now we find that that critical part of the settlement is not in practice providing any relief whatsoever to the industry," Wasch said.

Other terms of the settlement gave computer makers greater freedom to feature non-Microsoft software, allowing them to hide some Microsoft icons on the Windows desktop.

© Reuters