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    Government Favors Microsoft Breakup
By Ted Bridis
Associated Press Writer
Wednesday, Jan. 12, 2000; 4:05 p.m. EST

WASHINGTON –– Government lawyers studying ways to limit Microsoft's expansive
influence in the technology industry want to break the software giant into
three parts, arguing that lesser remedies in the antitrust trial would be
inadequate, people close to these discussions confirmed today.

If U.S. District Thomas Penfield Jackson were to agree to such a dramatic
solution, such a breakup of Bill Gates' software empire would carry enormous
implications for the way consumers buy and use programs for their computers.

Justice Department lawyers laid out their favored proposal to break Microsoft
into three parts during a secret meeting last week in Washington with
representatives of the 19 states also suing the company over alleged
antitrust violations, according to people close to the case who spoke on
condition of anonymity.

The Justice Department, which last month disclosed it had hired as its
adviser a financial consulting firm, Greenhill & Co. LLC of New York, argued
that any lesser sanctions – such as prohibiting the company from abusing its
influence – would be inadequate to rein in Microsoft's aggressive behavior.

Attorneys general for the 19 states are deciding among themselves whether to
endorse the Justice proposal but are said to be leaning in favor of it, and
the plan could be presented next week when government lawyers meet privately
in Chicago with the federal mediator assigned to the case, according to
people close to the case.

USA Today reported in today that the government favored breaking Microsoft
into two parts, not three. The Justice Department, in a statement, said the
story was "inaccurate in several important respects, and it does not
adequately represent our views."


© Copyright 2000 The Associated Press

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