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American Morning

Government's Decision to Leave Microsoft as One Company Doesn't Mean Bill Gates' Legal Problems Over Just Yet

Aired September 07, 2001 - 11:20   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
LEON HARRIS, CNN ANCHOR: The government's decision to leave Microsoft as one company doesn't mean Bill Gates' legal problems are over just yet. After all, two courts have concluded that Microsoft is a monopoly and has been operating as one. That means a federal judge in Washington still must fashion some sort of penalty.

Let's talk about this now with Joe Nocera in New York. He's the executive editor for "Fortune" magazine, and he's in our New York bureau.

Good morning. Thanks for coming in.

Let me ask you about that. What do you think of, of the move that was made by the courts yesterday? I heard some saying that, you know, it seems as what they did was take away the biggest hammer you could use to hit Microsoft and punish them, and now, there is nothing for Microsoft to fear, and that may not necessarily speed up remedy. What do you think?

JOE NOCERA, "FORTUNE" MAGAZINE: Well, they didn't have much -- they really didn't have any choice in taking the breakup off the table. The court of appeals had made it very, very clear that they were not going to accept a breakup as a remedy, and that was part of the things they pushed back the district court -- the federal court. So you know, I think they were facing reality on that.

And you know, there's a lot of talk about maybe the Bush administration appointees were more inclined in that direction anyway. And maybe they were. But really, they did what they had to do.

HARRIS: So you think that even if it had been Al Gore administration, and that Joel Kline who prosecuted the case against Microsoft and had won, and was there in the antitrust division, he would do the same thing in the case?

NOCERA: Well -- if you have the -- if the court of appeals says, we're very skeptical about a breakup remedy, and they kick it back to the lower court to basically be rereviewed, I mean, you can do two things, you can keep fighting it and fighting it, and it's only going to back up to the exact same appeal's court, or you can say, OK, let's take this off the table and try something else.

So you know, I don't know what Joel Kline would have done. But you know, it's just seems to me that on this one particular issue, it's about facing reality.

HARRIS: All right, well, let's talk about reality then, now that Microsoft has been off the dissection table here, What likely remedies will we be seeing, or at least hearing discussed?

NOCERA: Well, there's a whole range of conduct remedies they want to talk about, to try to negotiate, or have the new judge impose. You know, a lot of it has to do with not allowing Microsoft to use Windows as a weapon against both computer manufacturers who buy Windows and competitors who have products that compete with one or another various Microsoft products. So you are going to see a concerted effort to Force Microsoft not to be able to enforce licenses that put restriction on computer manufacturers.

You're going to see them, you're going to see the government try to force Microsoft to sell Windows to the same price for everybody. So you don't get a price break if you play by Microsoft's rules. You're going to see them try to actually force them to open the Windows code so more people can get a look at it, so that they can write their own software on Windows and not worry about Microsoft sabotaging them. There's a whole range of things like that they would like to try to do. How far that goes, a lot of it depends on how the new judge feels about the case.

HARRIS: Well, let me ask you one final question, because I saw a comment from you earlier that you said something about this may actually -- this ruling may actually mean as much, or quite a bit to Hewlett-Packard. What do you mean by that?

NOCERA: I can't imagine that I said that. So I have no idea where that came from.

HARRIS: I thought I saw that in some news bits we had.

NOCERA: Sorry, Leon.

HARRIS: Thanks anyway. Stumped myself on that one.

Joe Nocera, thanks a lot. And we'll be watch this to see how this whole thing develops, and we'll be talking with you no doubt about this later on. Take care.

NOCERA: Thanks, Leon.

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