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Microsoft Loses
Jon Rochmis from wired wrote in to tell us that Declan McCullagh has a story up now: Microsoft Loses. There really isn't a lot of details, except that the news is officially out, and that the penalties (and of course many more lawsuits) will be forthcoming.Update: 04/03 09:08 by H :Check out the official government site for the ruling -- in excruciating detail. CNNfn also has got an analysis up.
We wait again for the remedies to issue.
We knew that microsoft had lost as soon as we read the findings of fact,
which were a determination of what happened.. This just draws the only
possible conclusion that could be reached from the facts: illegal
conduct.
The FofF can be appealed, but the grounds are essentiall "no reasonable
person could come to this conclusion from the evidence presented." This
is close to impossible, and can be disregarded. The CofL can be
appealed on the grounds that they're incorrect given the facts, but
there's only one possible conclusion, monopoly. Analogy: he laid
in wait, then tortured and killed the victim. The only possible
conclusion is murder with special circumstances.
Next come the remedies, which can be appealed; MS would merely need
to convince the appellate court that another remedy would be better.
However, the court will usually defer to the trial court's judgment
on such matters unless it's clearly on a limb, as the trial court
heard the evidence and has spent much more time on the matter than
the appellate court possibly can.
In short: very little room on appeal for MS, unless the judge
does something *really* wierd for remedies. Breakup will be
examined closely, but would likely stand. It is highly unlikely
that anything short of breakup would be overturned.
hawk,esq.
The other problem that I see as critical is that, as Parish acknowledges, "everyone else is doing the same." The notion that Microsoft is the leader in the matter seems to me as nonsensical as the notion that they are a technical leader in the computer industry.
It is nonetheless quite fair to say that the big problem for Microsoft is not the "death of a thousand paper-cuts" that may come out of secondary lawsuits based on the evidence of this big one, but rather the long term effects of employee benefits being strongly dependant on the value of the option plan.
If the value of Microsoft stock does not continue to rise, then those option plans, and the resulting long term financial security of MSFT employees, is injured. And it is that injury is what is liable to ultimately cause crucial injury to the corporation.
As for outsiders that are injured, I have less qualms than you. People have chosen to invest in what is necessarily a risky investnment, just like Dutch Tulip Bulbs, the South Sea Investment Company, the Nifty Fifty, and Tokyo real estate. If they were foolish in underestimating the risk, that's a loss that they foolishly underestimated.
Throw in "ethical considerations" and it may turn it from "well-deserved" to "richly-deserved..."
If you're not part of the solution, you're part of the precipitate.
I have no sympathy for M$ investors who lost some cash today. As stock-holders, they are part-owners in a company that has routinely run rough-shod over everyone, competitors and partners alike. They were willing to keep their collective head in the sand as long as Redmond was pulling in the profits. For that, I say, they're getting what they deserve.
I do empathize with the investors who lose money from any downward panic affecting related (i.e., software, Internet) companies.
Dewey, what part of this looks like authorities should be involved?
Lastly, I see you didn't dispute my assertion that much of the economic growth we have enjoyed can be attributed to Microsoft. Just in case you do decide to come back and dispute that claim. Examine the economic impact that Microsoft has on each phase of our economy before you answer including but not restricted to games, server software, internet related technologies, and application development.
I seen the MS drove the economic boom argument used over and over, and I just don't get it.
Are the people making these arguments really that naive to believe that without MS the PC and/or internet would not have happened?
Or is the argument more along the lines of that sure MS abused their monopoly position but lots of folks got rich because of it so it's ok?
And who did the analysis to show that having MS dominate led to greater economic grow than if we had had real competition? (As part of the background research for that analysis one might want to consider what happened when AT&T was broken up. There was a bit of economic growth and wealth creation that wasn't because of MS.)
All in all I think the MS made us rich so leave them alone argument is both flimsy and beside the point. MS is a Monopoly. MS abused its monopoly position. (This is fact - pending appeal.) MS should pay the price.
Steve M
I'd like to make this comment a place for people to put their favourite comments from the ruling, so reply to it with your faves. Mine so far are:
and...
and especially...
Microsoft counterclaims that the DOJ is using a federal court to enforce state laws in conflict with Microsoft's federally guaranteed rights.
Judge Jackson responds...
Yeah! Accuse your presiding judge of being an instrument in the subversion of federal law. That will make him like you.I don't believe that anything says the Supremes have to hear the case, and they might not want to touch such a live wire. However, if they do, the buck stops there.
--The basis of all love is respect
Personally, I hope not. A bunch of smaller companies all sharing the same product lines but having less developers to maintain them doesn't seem like a good idea for the marketplace or for consumers.
The remedy I prefer is one where they are divided along product lines. Some of the most important divisions to be made are:
Personally, I think seperating the DOS-derived Win98 codebase from from the NT codebase is a bad idea since we all know that Win98 and its future derivatives are technology the company is trying to phase out. It would be equivalent to seperating out Word 6.0 from Office 2000. The company with the older product wouldn't be a competitor and would be saddled with bad technology. Seperating out WinCE might not be a bad idea, though, since it's fundamentally a different code base and target market.
Some other ideas might be seperating out their developer tools or their multimedia tools into another company. I'd also like to see if they do split the companies up who gets what subsidy and tangetal business that Microsoft has absorbed and bought out over the years. Maybe a seperate holding company for their subsidies would be a good idea.
Microsoft is the world's largest Mac software company. With some of their products given to seperate companies from the OS company, we might see more platform independent products from those companies. Without an interest in keeping loyal to Windows, we might see such products ported to Linux and other OSes in the future. The lack of loyalty for one another combined with the inability to bundle might mean an end to Windows as a platform and the dawn of a better age for consumers.
If it's for-profit but free, you're not the customer -- you're the product (e.g., the Slashdot Beta's "audience").
I haven't read the findings yet (no-one has), but this is only the beginning.
First, the remedies will be announced. Then, the appeals start. Realistically, these will take years.
However, I understand that the findings can be used by the *many* class action suits. This will hurt MS badly. The real damage will be to their share price. Historically, a significant part of the remuneration to MS staff has been in stock options. In the past, this was a great deal. But if the share price starts to fall, they will find it very hard to hire and retain the best people. Unless this is very carefully managed, it could easily lead to a vicious circle.
It will be very interesting to see what MS does over the next few months to shore the share price up. I hope they don't do anything illegal in the process. That would be tragic.
Whether they did something bad or not doesn't change the fact that you, me, the businesses we work for, the schools we go to, and just about everything around us is effected by Microsoft.
So you're saying we should all just roll over and accept this kind of behavior?
If Microsoft closed it's doors, I don't think we'd have another "great" depression. Just because they go away doesn't mean their software and all of their support people do. Companies would still run Windows for a while, and they'd still have support for it. (There are 250,000 MCSE's after all)
The thing is, if they in fact could cause a depression, there's something wrong. What does that say about our world? We rely THAT much on ONE company? That's a reason why there are now "baby-bells". To give one company that much power over the economy is just stupid. Hopefully, within a couple years, it'll be taken care of.
But I'm not even close to just closing my eyes and pretending they aren't doing anything wrong. And, well, maybe you shouldn't be either.
I remember when the Findings of Fact came out, and Slashdot had a bunch of legal experts analyze it. Will they do the same for the Findings of Law?
www.eFax.com are spammers
(Older info is also available at the US v. Microsoft page at the the U.S. Department of Justice website)
--
The shareholder is always right.
(disclaimer, IANAL)
... after all, that's muscling vi and emacs out of the market). This one is very scary since it tends to suggest that the government might try to take a role in OS design.
After skimming over the decision, I have some ideas as to where the eventual penalty in this case might go.
There are a few major issues that the decision seems to rest upon: Microsoft's exclusive contracts with OEMs to which it used to muscle Netscape out of the market, its corruption of Java, the fact that it tied IE in with Windows, and its high prices.
Nowhere does it mention that they made Windows incompatible with another piece of software, or that they used hidden APIs in any of their products, which would be the biggest argument toward opening part or all of the Windows source code. Since neither of those is mentioned at all, or even alluded to, I believe that opening their APIs/source code isn't a likely penalty.
A large portion of the decision is dedicated to Microsoft tying products into Windows, so I'd expect strict rules as to what can and cannot be built into Windows in the future (watch, WindowsME will ship without Notepad
I don't know if anything in the decision really seems to point to Microsoft potentially being fined. I'd think that there probably will be a fine levied regardless, since it's such an easy thing to do. It looks like if anything is done regarding money, however, it might be that rebates will be offered to consumers, and future pricing on Microsoft products will be regulated. The "fines" will likely come in decisions in other lawsuits that will spring up now that Microsoft is officially an "evil monopoly".
The sections of the decision about Microsoft's business practices... it's exclusive contracts, and that it used its monopoly power to try to build a monopoly in a second market are very interesting indeed. There are definite shades in the decision that suggest the judge might be open to ruling that Microsoft be split in some form.
Up until today, I thought splitting Microsoft up was such a remote possibility based on what I've heard about the case so far, but after reading the decision, it seems like it might be a distinct possibility. Based on some of the wordings in the decision, a split would likely break Microsoft into seperate but equal, competiting companies, rather than along product lines. A break along product lines wouldn't solve most of the problems outlined in the decision.
Regardless, after the appeals are all through, what finally gets decided will be interesting to see.
NO CARRIER
>I mean, how many appeals avenues are left?
.well . . .
The (presumed) appeal will be heard by the Court of Appeals for the DC Circuit. There will be a three judge panel that hears this appeal (in contrast to the single judge- Jackson- sitting in District court). Theoretically, if one side or the other is unhappy with the decision that this three judge panel makes, it can ask for an "en banc" hearing- meaning all the judges of the Court of Appeals (9?) sit and rehear the appeal. After that en banc request is rejected (they usually are), the final stop (just a few blocks up the street, really) would be the Supreme Court.
But in all likelihood, it'll be settled before that. Why? I seriously doubt the Supreme Court will take this case.
>What exactly can they appeal, and what is set in stone?
What comes out today- the "legal conclusions"- are appealable. Basically, Judge Jackson is explaining how he thinks MS has violated the law. As it's a "question of law", he can be reversed by the Court of Appeals. As a higher court, it can rule more authoratatively on what "the law" is.
In contrast, his "findings of fact" are pretty much set in stone. This is due to the presumption that since he sat and listened to all the evidence, he's in a better position than any appeals court to have determined what occured.
>Is this ruling likely to have teeth, or is it only the first move in an endless and boring dance?
Can I say "both"? I think that he won't be shy in imposing a remedy, as his findings of fact seem to indicate he's taken a pretty dim view of MS's conduct (and I could be more helpful if someone would mirror the )$#$*# conclusions and I could read it . . . ). I also go with "endless and boring" because both sides have shown that they're willing to sit this out as long as it takes to win- DOJ because it's likely "right", and MS cause . .
While the Court of Appeals is likely to be a bit more sympathetic than Judge Jackson, that ain't saying much.
The best MS can hope for is a settlement they get at least *some* input into. I'm very surprised Posner was unable to bring the sides together. He's a brilliant fellow who's quite well respected for his understanding of law and economics- that he couldn't get it done speaks to the chasm between the two sides.