![]() ![]() threatening to cancel new Macintosh versions of Microsoft Office software unless Apple installed Explorer in the Mac as its default browser.pressuring computer chip-maker Intel not to develop its own competing browser.threatening to cancel the licensing of Windows to computer makers unless they agreed to install Explorer.giving Explorer away to drive Netscape out of the browser market.The government plaintiffs accused Microsoft of: They tried to prove that Microsoft had acted unfairly to suppress the development of competing browser technology that threatened its Windows monopoly. The federal and state governments presented testimony and other evidence (including hundreds of Microsoft e-mail messages). The trial began in October 1998 before a federal judge, Thomas Penfield Jackson. Even so, the federal and state governments decided to go on with their antitrust lawsuits, alleging that Microsoft was illegally attempting to preserve its Windows monopoly. ![]() In June 1998, Microsoft gained a partial victory when a federal judge overruled the earlier court order banning the company from bundling Explorer with Windows. Joel Klein, head of the Justice Department's Antitrust Division, declared, "What cannot be tolerated-and what the antitrust laws forbid-is the barrage of illegal, anti-competitive practices that Microsoft uses to destroy its rivals and to avoid competition." Gates rejected this view and explained that Microsoft's success came from its innovative, superior, and low-cost software that benefited the consumer. This was the same law the government used to go after AT&T 20 years ago and Rockefeller's Standard Oil almost a hundred years ago. The Sherman Act prohibits attempts by businesses to monopolize a market by unfairly eliminating competition. In May 1998, after fruitless attempts to settle with Microsoft out of court, the federal government, 20 states, and the District of Columbia sued the company under the Sherman Antitrust Act of 1890. By spring 1998, Microsoft dominated 90 percent of the operating system software market, while its Explorer browser was rapidly replacing Netscape's Navigator. Justice Department considered additional legal action against the giant software company for antitrust law violations. This time, however, Gates balked and appealed the court order. It directed Microsoft to offer computer makers the choice of installing Windows with or without the Explorer web browser. Attorney General Janet Reno obtained another court order late in 1997. Since more than 85 percent of the computers sold at this time included Windows bundled with Explorer, sales of Netscape's Navigator plummeted.Ĭlaiming that Microsoft had violated the 1995 consent decree, U.S. Netscape complained that Microsoft was competing unfairly, first by giving Explorer away free and second by forcing the manufacturers to make it the default browser on their computers. If these companies refused to add Explorer to the Windows desktop, they would lose their license to install the popular operating system on their computers. In 1995, Microsoft started to require computer manufacturers licensed to install Windows to include, or "bundle," Explorer at no extra charge to the consumer. ![]() Belatedly, Gates recognized the Internet's potential and introduced Microsoft's own browser, called Explorer. To reach the Internet's graphical World Wide Web, users need a software application known as a " browser." The Netscape Company was the first to flood the browser market with its Navigator (later renamed Communicator). A court order known as a consent decree formalized the agreement in 1995.īy the mid-1990s, the Internet had opened a new way to use computers for millions of people. To avoid a costly lawsuit, Microsoft agreed to stop practices like this. One of these practices required computer makers who wanted to license Windows to pay a fee for every machine they manufactured, even those with other operating systems. government began to investigate Microsoft for using unfair practices in competing against other companies. Gates, 44, owns about 15 percent of Microsoft stock, making him the richest man in the world. Today, with Windows installed in about 90 percent of the world's computers, Microsoft stock is valued at more than $550 billion. The company took off when Gates and Allen improved some operating system software and licensed it to IBM.Īfter Apple developed the first point-and-click operating system for the Macintosh in 1984, Microsoft produced its own version, called Windows. In 1975, Bill Gates dropped out of Harvard and joined with his friend, Paul Allen, to form a software company named Microsoft. ![]()
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