The government is resolved. Microsoft is defiant. Software vendors are wondering if Windows 98 will really release on time.
Let the antitrust lawsuit of the decade begin."Today's Justice Department action is but the opening salvo in what I believe will be one of the most important antitrust cases in modern times," Sen. Orrin Hatch, R-Utah, said Monday.
"I think we'll all be old and gray by the end of this lawsuit," speculated best-selling author and former Microsoft manager Julie Bick.
Utah is among 20 states and the District of Columbia to file an antitrust lawsuit against Microsoft Monday parallel to a federal antitrust suit filed by the Justice Department.
"We are taking this action to give a fair shake to competitors and free choice to consumers in one of the most crucial industries in the nation," said Utah Attorney General Jan Graham.
At issue is the dominance Microsoft has over the personal computer market - and whether programs bundled with its Windows operating system software position Microsoft to unfairly monopolize the software market - especially when it comes to Microsoft's Explorer Web browser. Competitor Net-scape's share of the market continues to shrink as more and more computers hit the market with Explorer already on board.
"It would be a true shame if the keys for the gateway to the Internet - the most important commercial and communications medium of all time - are placed in the hands of a single company at a time when the Internet is in its very infancy," Hatch continued. "The Internet is simply too important to the future of our economy and society to confer so much control over its growth and development to one monopolist."
Monday's shipment of Microsoft's Windows 98 with its Explorer software also in the box signaled the end of negotiations between Microsoft and the government. New PCs with Windows 98 pre-installed, and boxed versions of the software, are scheduled to be on store shelves June 25.
"I'm very disappointed we couldn't reach an agreement with the government," said Microsoft chief Bill Gates in a statement Microsoft had on media fax machines Monday afternoon. "We believe an antitrust lawsuit is counterproductive, costly to the taxpayers and ultimately will be unsuccessful in the courts," Gates said. "This suit is all about Microsoft's right to innovate on behalf of consumers - the right to integrate new technologies into Windows as they develop."
Bick's book "All I Really Need to Know in Business I Learned at Microsoft" has been in bookstores for about a year and was just released in paperback - good timing for her and the former employer she defends.
The mood today at the Redmond, Wash., Microsoft headquarters? "I don't think anyone's cashing in their stock options yet, let's put it that way,"
She sees the government telling Microsoft to be less forceful in its competition as "telling your slugger not to swing for the fences - just hit a double even though the fans all want a home run."
And if she's right about the lawsuit dragging on for years, the old saying that "any publicity is good publicity" may play in Microsoft's favor in the interim.
"It might create a big run on Windows 98. People might all rush out to buy it before the government stops it from being sold - (the lawsuit) might increase Microsoft's sales."
Assistant Utah Attorney General Wayne Klein isn't hearing that lawsuit publicity has been good for Microsoft. "This isn't something like R-rated movies where you say something about it and everybody has to go out and watch it."
Still, the suit has an essential outside-the-courtroom element. "I think it really is going to be a battle for the mind of the consumer. If Microsoft perceives that the public thinks they are anti-competitive, I think they would worry about there being a backlash," he said. "If we win the heart and mind of the public, Microsoft will give in. If they believe they're winning, they'll fight."
Windows 98 will inevitably find a niche but will neither be the lawsuit's hostage or the token of vindication, speculates Joe Cooper, Computer City's Utah corporate sales manager. "Nobody thinks its going to be a big seller - not nearly as big as Windows 95. It'll be shipped on new (computer) systems, and slowly you're going to see people forced into using it."
Competing retailer CompUSA is more reserved in its speculations about the retail impact the lawsuit will have on Windows 98. "We express our concerns about any possible delay and hope it ships on time," said corporate spokeswoman Carol Elstrom.