Massachusetts hysteria


Issue: "California's total recall," Aug. 2, 2003

The Justice Department and 19 other states have settled their antitrust cases against Microsoft, yet Massachusetts presses on. Bay State prosecutors want a U.S. appeals court to punish Microsoft harder, claiming the settlement "fails to stop all of the behavior this court found illegal." They also plan a website and a telephone hotline to collect complaints about the company.

Why Massachusetts? Attorney General Tom Reilly says he's protecting his state's 3,000 software companies. Specifically, he claims Microsoft hurt one up-and-coming company that was pushing Linux, which competes with Windows. Critics suspect this is just political grandstanding for a lost cause.

Microsoft's alleged misdeeds occurred before the dot-com boom and bust. Much of the dispute hinges on whether it used its Windows market power to destroy the Netscape browser-yet the Browser Wars are history. (The once-dominant Netscape, now controlled by AOL, is basically a shell for an open-source program called Mozilla.)

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Nevertheless, the sluggish economy has been more of a problem to Microsoft than have nuisance lawsuits. Two months ago, it ended stock options for employees, a signal that the company's future growth will be much slower-even though it still commands billions in cash. Microsoft reaps beaucoup bucks on its Windows and Office software packages-while its Xbox game system and MSN online service are still money losers.


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