Case tops long list of MS probes

Today's decisive action by the Justice Department against Microsoft caps nearly eight years of investigations into the company.

2 min read
Today's decisive action against
Microsoft by the Justice Department is the latest in a long list of investigations into the software giant's business practices.

The department's decision to charge Microsoft with Microscope on Microsoft violating a 1995 court order--which blocked the company from using its Windows operating system to leverage the shipment of other Microsoft software--is the first of its kind in three years. But it follows a long list of regulatory reviews at various levels of government.

The department also has been under increasing pressure from consumer groups to look into the company's marketing and licensing practices. In September, the Washington-based Consumer Project on Technology began circulating a letter calling on Assistant Attorney General Joel Klein, head of the department's antitrust division, to investigate the pricing and bundling of the Internet Explorer browser.

That investigation was opened after Netscape filed a complaint last year alleging that Microsoft used unfair and anticompetitive practices in promoting Internet Explorer.

Last July, three senators requested that the Federal Trade Commission reopen an independent antitrust investigation of Microsoft business practices, citing the slow pace of the Justice Department's probe. The FTC rejected that request.

Nevertheless, at least six states have launched Microsoft probes. In October, Oregon, Connecticut, New York, and California joined Texas and Massachusetts in conducting investigations into Microsoft over possible antitrust violations.

The company has drawn regulatory scrutiny beyond U.S. borders as well. The European Union, for example, has confirmed that it is looking into Microsoft licensing practices.

An unprecedented case of transatlantic cooperation between the Justice Department and the European Commonwealth resulted in a 1994 settlement and a court order the next year, under which Microsoft ended certain licensing practices.

At that time, competitors criticized the Justice Department and characterized its penalty as a mere slap on Microsoft's wrists. They also complained that the department did not delve deeply enough into other business practices for possible antitrust violations.

The Justice Department also has challenged Microsoft in the area of mergers and investments. The department filed a lawsuit against the software giant in 1994 over Microsoft's proposed $2 billion acquisition of personal finance software maker Intuit. That action prompted Microsoft and Intuit to cancel their merger plans.

This year, the Justice Department is looking into Microsoft's $150 million investment in Apple Computers (AAPL) and has "requested information" involving the company's recent involvement in the streaming video market with its acquisition of VXtreme, a 10 percent stake in Progressive Network Solutions and a 5 percent share in VDOnet.

Justice also looked into Microsoft's $450 million purchase of WebTV but cleared the buyout after what it called a "thorough investigation" into possible violations of antitrust laws.

A detailed listing of the federal government's cases involving Microsoft can be found on this Justice Department Web page.

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