As the ink dries on settlements that could well bring to a conclusion a pair of anti-trust cases that have long dogged Microsoft, experts question whether the company is truly committed to a new way of doing business or is merely gearing up to do battle on new fronts.
As the ink dries on settlements that could well bring to a conclusion a pair of anti-trust cases that have long dogged Microsoft, experts question whether the company is truly committed to a new way of doing business or is merely gearing up to do battle on new fronts.
“I think Microsoft is fixing to get this stuff out of the way and then you will see the real battle engaged,” says John Enck, an analyst with Gartner. “They are taking care of business.”
Those battle engagements seem most likely to happen around search engine technology, business applications, real-time communication and telephony.
Microsoft last week signed settlement agreements with the Computer and Communications Industry Association (CCIA) and Novell. The deals effectively end the longest-running anti-trust case in U.S. history and subtract the European Union’s last remaining allies, save Real Networks, in its still unfinished anti-trust case against Microsoft. The CCIA’s withdrawal of a complaint related to Windows XP possibly removes a major hurdle to a settlement between Microsoft and the EU.
The settlements are part of an 18-month effort that has seen Microsoft spend nearly $3 billion to settle anti-trust issues with agreements and payouts to AOL/Time Warner, Sun and Novell. The company spent another $1 billion for class action suits, and Microsoft says it may well spend an additional $950 million.
“We believe that this sends a strong message that we and other companies in our industry do have the capacity now to sit down face to face and resolve the kinds of thorny anti-trust issues that in the past were left instead to the government to resolve,” said Brad Smith, senior vice president and general counsel at Microsoft, last week during a press conference. “The second major theme in my mind that is quite important is the foundation this creates for our industry to work together on the important issues of the future.”
Microsoft and CCIA said in the future they would focus on issues such as funding of research and development, broadband, privacy and security.
“We settled the litigation, which was very consuming, and it meant other things did not get attention,” said Ed Black, president of CCIA. But Black said CCIA won’t compromise its goals of openness and cooperation and still expects disagreements with Microsoft.
Despite some experts’ reservations about Microsoft, others say it has embarked on a major effort to reinvent its reputation.
“Microsoft has always been an aggressive company,” says Matt Rosoff, an analyst with independent research firm Directions on Microsoft. “But there’s almost now this paranoia, a lot of times unwarranted, among potential customers and partners that Microsoft will get into their business space and they won’t play fair. By clearing as many of these cases as they can Microsoft is trying to reverse that impression a little bit.”
“The audience for this stuff is really the world marketplace, where Microsoft has run into some roadblocks, which often are Linux-based,” says Dwight Davis, an analyst with Summit Strategies. “Generally speaking, settling these issues helps make the company more palatable to foreign governments.”
