Breakup Order Heads for Appeals Court

Judge Thomas Penfield Jackson, following a script written by the Department of Justice (DoJ), has ordered that Microsoft be broken into two companies and has imposed strict rules on Microsoft’s conduct. The final judgment brings the Microsoft trial to an end after two years, but appears to have only set the stage for an appeals process, which could last even longer. Microsoft has applied to stay Judge Jackson’s judgment and says it will appeal the judgment to the Court of Appeals. The DoJ says it wants to take the case directly to the Supreme Court.

The Judgment

Judge Jackson’s final judgment virtually mirrors the proposed final judgment put forward by the DoJ in May. It would break the company into an operating systems company and an applications company, with the vast majority of Microsoft’s product line going to the applications company. The operating systems company would have a pared-down version of today’s operating systems that would include a version of the current Internet Explorer (IE) browser, but little else. Even server products that might today be considered tied to the operating system, such as Internet Information Server, streaming media server software, and Java Virtual Machines, would be considered the property of the applications business, although the operating system business would be granted a perpetual source code license to some of these. (For details of the DoJ’s proposal, see “Government Calls for Microsoft Breakup” on page 20 of the June 2000 Update).