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By Ken Auletta

[pound]17.99 Profile

ISBN 1-86197-390-X

Microsoft's lengthy legal battle with the US government in a civil suit over charges of breaching Anti-trust legislation is considered one of the most important legal disputes of the century. Ken Auletta's book tells this complex story, characterising the protagonists skillfully, explaining the technological implications and providing a neutral overview of the years of argument and counter argument which is still to be properly resolved.

What is clear is that the business of new technologies which have made multi-billion dollar fortunes for many of its players, not least Microsoft chief Bill Gates -- generally described as the world's richest man -- has been, and is, a corporate struggle for dominance fought with unremitting determination. No prisoners were taken in the struggle for market share.

Microsoft's pre-eminent position in this conflict, supplying over 90% of all personal computer software, seemed unassailable.

Corporate rivals, large and small, attempting to gain or keep a foothold in the emerging new economy would tremble at the thought of tangling with Microsoft.

In 1998, Microsoft realised profits of some $4.5bn (around 40% of operating revenue -- and about twice as large as the world's biggest company, General Motors). It took the might of the world's sole super-power, the US government, to even put a brake on Microsoft's exponential growth.

Citing an abuse of monopoly power, the US justice department drew up charges and took the corporation to court. They specifically cited that Microsoft used its control over software operating systems to impose contractual obligations on computer manufacturers, as well as internet service and content providers, hindering their ability to do business with any Microsoft competitor.

Not so, claimed Microsoft, our motives were simply for the benefit of consumers.

Gates surly and evasive

In essence, the case rested on the credibility of the witnesses called by each side. Reams of documents were presented in evidence, particularly internal Microsoft e-mails and, on the face of it, these communications seemed to directly contradict what Microsoft witnesses were testifying.

The author believes that no evidence seemed less credible than Bill Gate's own videotaped deposition where he appeared in turn to be surly, obstructive and evasive. Other observers thought that Microsoft executive, Jim Allchin, was responsible for the most damaging revelations when the Department of Justice unearthed an e-mail he sent to his boss, Paul Martiz, which advocated Microsoft 'leveraging' its Window's market share advantage to crush competition.

Flawed legal strategy

Ken Auletta takes the view that Microsoft's legal strategy was flawed from the outset. He contends that Microsoft would have made a much better case in admitting that it was concerned with market-share, that such considerations are, after all, a perfectly justifiable business consideration -- and they were acting as any company would. Instead, the idealistic argument they presented, that they were acting solely for the benefit of consumers, was simply unbelievable and contrary to much of the evidence presented.

Microsoft's appeal against last year's judgement began in Washington late last February. They are claiming that the trial judge, Thomas Penfold Jackson -- who has ordered that Microsoft be split into various companies to dilute its monopoly status was biased against the company.

Judge Penfold gave the author 10 hours of interview time, and explains in this book just why he came to his judgment last June.
COPYRIGHT 2001 IC Publications Ltd.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 2001 Gale, Cengage Learning. All rights reserved.

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Title Annotation:Review
Publication:African Business
Article Type:Book Review
Geographic Code:1USA
Date:Apr 1, 2001

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