Effects of the Antitrust Settlement

Facing a Dec. 16 deadline, Microsoft is making changes to comply with the consent decree it signed with the Department of Justice (DoJ) and nine states in Nov. 2001. The consent decree—the document that Microsoft and these plaintiffs signed to settle their antitrust case—places restrictions on Microsoft’s behavior that will create some benefits for OEMs, ISVs, other partners, and consumers.

With this date in mind, Microsoft CEO Steve Ballmer and Associate General Counsel Dave Heiner sent a memo to all Microsoft employees outlining specific changes they must make effective Dec. 16. (Although the decree will not be officially approved until Feb. 2002 at the earliest, its provisions will be retroactive to Dec. 16, 2001.) This is the first time Microsoft has given its entire staff specific guidelines on how to avoid antitrust problems and indicates that the company is taking the consent decree seriously, rather than risking further litigation by brushing it off.

Determining the true effects of the consent decree is difficult, partly because the parties chose to define some familiar computing terms in new and unfamiliar ways. (See the sidebar “Settlement Terminology Defined“.)