Hearing on Microsoft deal today

Associated Press

WASHINGTON — The Justice Department and Microsoft will make their case to a federal judge on Wednesday that their landmark antitrust settlement is good for the economy and consumers.

Their voices won’t be the only ones heard. The judge has set aside almost an hour for Microsoft’s critics.

U.S. District Judge Colleen Kollar-Kotelly will hear from all the parties — Justice, Microsoft, the nine settling states and several groups that are against the deal — in a hearing that will ultimately determine whether the judge approves or tosses out the settlement.

Her decision may come much later. Nine other states seeking stronger penalties against Microsoft are scheduled to begin their own proceeding next week, although the company is trying to delay that hearing.

The judge is widely expected to postpone her decision until that trial ends — which could take several months.

The settlement would prevent Microsoft from retaliating against partners for using non-Microsoft products; require the company to disclose some of its software blueprints so software developers can make compatible products; and make it easier for consumers to remove extra Windows features.

SBC Communications Inc., one of the four remaining Bell telephone companies, will speak openly for the first time about the case. The firm fears that as computers, cell phones and other devices become more integrated, Microsoft’s dominance on the computer screen could stretch elsewhere.

"Our battlefield is that when you’ve got somebody in that position, for God’s sake, judge, make sure that the decree is an effective decree that will prevent them leveraging that illegal monopoly into those adjacent markets," said Jim Ellis, SBC’s general counsel.

Microsoft programs already support voice communications over the Internet, and the company is planning a "smart" computerized cell phone called Stinger.

Ellis said Microsoft’s track record combined with technology convergence makes it important that all tech firms speak out about the settlement.

"What I don’t understand is why every software writer, every entertainment entity, every cable company, every communications provider, are not in this case," Ellis said.

At least two groups say they plan to tell the judge that a provision that would allow computer manufacturers to remove icons leading to "middleware" products, like the Internet Explorer Web browser or Microsoft’s instant messaging program, are not enough to help other software developers compete.

The underlying programs would still exist in Windows, and critics say developers would feel forced to either write software that’s compatible with those Microsoft programs or bear the cost of including competing middleware made by companies such as AOL or RealNetworks.

Ed Black, head of the Computer and Communications Industry Association, said portions of the settlement designed to protect computer manufacturers won’t help.

"Microsoft is saying it’s good for the industry," Black said. "Where was Dell? Where was Gateway? Where was anyone else in the industry who is on their side?"

After spending most of the four-year antitrust case on the sidelines, Gateway is sending one of its top executives to testify for the states still suing Microsoft.

According to documents filed with the court, Gateway executive Anthony Parma plans to say that the government’s proposed sanctions wouldn’t protect computer manufacturers from Microsoft retaliation for using a competitor’s product.

A Dell spokeswoman said the company would not comment on the settlement.