[Federal Register Volume 59, Number 221 (Thursday, November 17, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-28441]


[[Page Unknown]]

[Federal Register: November 17, 1994]


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DEPARTMENT OF JUSTICE
 

United States v. Microsoft Corporation Civ. No. 94-1564 (SS) 
(D.D.C.); Response of the United States to Public Comments Concerning 
the Proposed Final Judgment and Notice of Hearing

    Pursuant to section 2(d) of the Antitrust Procedures and Penalties 
Act, 15 U.S.C. Sec. 16(d), the United States publishes below the 
written comments received on the proposed Final Judgment in United 
States v. Microsoft Corporation, Civil Action No. 94-1564 (SS), United 
States District Court for the District of Columbia, together with its 
response thereto. A hearing will be held on this matter at 10 AM on 
December 15, 1994, at the United States Courthouse, Third Street & 
Constitution Avenue, NW., Washington, DC 20001. Any persons who may 
wish to be heard at such time should make a written application to the 
Court on or before December 4, 1994, and provide a copy to the 
Department of Justice. Such application should include a summary of the 
comments or views that the applicant wishes to express at the hearing 
and a statement of why the views of the applicant should be heard by 
the court. Please send the Department of Justice copy of any such 
application to Donald J. Russell, 555 Fourth Street, NW., room 8104, 
Washington, DC 20001, (telephone (202) 514-5621).
    Copies of the written comments and the response are available for 
inspection and copying in Room 3235 of the Antitrust Division, United 
States Department of Justice, Tenth Street and Constitution Avenue, 
NW., Washington, DC 20530 (telephone (202) 514-2481) and for inspection 
at the Office of the Clerk of the United States District Court for the 
District of Columbia, room, United States Courthouse, Third Street & 
Constitution Avenue, NW., Washington, DC 20001.
Mark C. Schechter,
Deputy Director of Operations.

United States Response to Public Comments

    Pursuant to the requirements of the Antitrust Procedures and 
Penalties Act, (``APPA'' or ``Tunney Act'') 15 U.S.C. Sec. 16(b)-(h), 
the United States hereby responds to public comments it has received 
relating to the proposed Final Judgment in this civil antitrust 
proceeding. After careful consideration of these comments, the United 
States continues to believe that the proposed Final Judgment will 
provide an effective and appropriate remedy for the antitrust 
violations alleged in the Complaint. After the public comments and this 
response have been published in the Federal Register, pursuant to 15 
U.S.C. Sec. 16(d), the United States will move the Court for entry of 
the proposed Final Judgment.
    This action began on July 15, 1994, when the United States filed a 
Complaint alleging that Microsoft Corporation had unlawfully maintained 
its monopoly of personal computer operating systems and had 
unreasonably restrained trade, in violation of sections 1 and 2 of the 
Sherman Act, 15 U.S.C. Secs. 1, 2. Simultaneously, with the filing of 
the Complaint, the United States filed a proposed Final Judgment and a 
Stipulation signed by the defendant consenting to the entry of the 
proposed Final Judgment after compliance with the requirements of the 
APPA.
    Pursuant to the APPA requirements, the United States filed a 
Competitive Impact Statement (``CIS'') on July 27, 1994. The defendant 
filed a description of certain written and oral communications on its 
behalf, as required by section 15(g) of the APPA, on August 8, 1994. A 
summary of the terms of the proposed Final Judgment and CIS, and 
directions for the submission of written comments relating to the 
proposal were published in the Washington Post for seven days in the 
period from August 7, 1994 through August 13, 1994. The proposed Final 
Judgment and the Competitive Impact Statement were published in the 
Federal Register on August 19, 1994. 59 Fed. Reg. 42845-42857 (1994).
    The 60-day period for public comments began on August 20, 1994 and 
expired on October 18, 1994.\1\ The United States received five 
comments, which are attached hereto as Exhibits 1-5. Three of these 
comments relate to alleged Microsoft practices that the government did 
not challenge as violations of the antitrust laws, and which are not 
addressed in the proposed Consent Decree. Only one comment relates 
directly to the proposed relief, and that comment suggests that an 
additional remedy should have been included. Finally, one brief comment 
argues that the government should not have taken any action against 
Microsoft.
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    \1\The United States has treated as timely all comments that it 
received up to the time of the filing of this response.
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I. Background

    The proposed Final Judgment is the culmination of an investigation 
of Microsoft begun by the Federal Trade Commission (``FTC'') in June 
1990 and continued by the Department of Justice beginning in August 
1993. From April 1991 onward, the FTC's investigation had as its 
central focus the licensing practices by which Microsoft distributes 
its operating system software products, MS-DOS and Microsoft Windows, 
to manufacturers of personal computers, a group referred to in the 
computer industry as original equipment manufacturers or OEMs. In the 
course of its investigation, the FTC subpoenaed documents from 
Microsoft, deposed over a dozen Microsoft officers and employees, and 
interviewed numerous OEMs, firms that compete against Microsoft in the 
development and sale of operating system software, and other software 
industry participants.
    While focussing on Microsoft's licensing practices, the FTC staff 
also considered whether Microsoft attempted to stifle competition in 
various computer software markets through other practices. Among other 
things, they considered whether Microsoft had deliberately created 
incompatibilities between its Windows operating system software product 
and its competitors' disk operating system products in order to 
disadvantage those competing products; whether Microsoft used false 
preannouncements of new products; and whether Microsoft's developers of 
applications software products obtained an anticompetitive advantage 
over their competitors because they received preferential access to 
information about Microsoft's operating system products.
    In August of 1993, following reports that the FTC's deliberations 
had ended with a 2-2 vote that would result in no enforcement action 
against Microsoft, the Antitrust Division of the United States 
Department of Justice began its investigation of Microsoft. The Justice 
Department was provided with complete access to all evidence collected 
by the FTC in the course of its investigation. After reviewing this 
evidence, the Department sought additional evidence from Microsoft and 
other industry participants. The Department carefully examined the use 
by Microsoft of per-processor and per-system licenses to distribute MS-
DOS and Windows to OEMs. The Department also looked extensively at all 
other issues that had been considered by the FTC, including alleged 
false product preannouncements and the relationship between Microsoft's 
operating system and applications divisions. In addition, the 
Department's investigation explored new issues which first emerged 
during the course of its investigation, including Microsoft's use of 
restrictive non-disclosure agreements.
    The Department contacted dozens of OEMs, and Division staff lawyers 
visited at least fifteen OEMs in person. In addition, the Division 
contacted numerous other industry participants, former Microsoft 
employees, and other companies and individuals knowledgeable about the 
computer software and hardware industries. In total, the Department 
conducted over one hundred interviews of individuals involved in the 
software industry. Twenty-two depositions were conducted pursuant to 
Civil Investigative Demands (``CIDs'') issued by the Department; six of 
these oral examinations were of top-ranking officers of Microsoft. In 
addition to reviewing the material produced to the FTC, the Department 
reviewed material produced in response to twenty-one additional CIDs 
that it sent to a number of software companies, including Microsoft. In 
total, the Department reviewed over one million pages of documents in 
connection with this investigation.
    At the conclusion of this effort, the Department determined that 
certain of Microsoft's licensing practices and its use of unreasonably 
restrictive non-disclosure agreements violated the Sherman Act. The 
Department challenged these practices, and obtain a proposed Consent 
Decree which adequately addressed the competitive concerns. As to all 
other areas that were investigated, the Department carefully considered 
the evidence before it under the prevailing legal standard, and 
determined that no further action was warranted on the evidence before 
it.

II. Response to Public Comments

A. Comments That Do Not Relate to Violations Charged in the Complaint

    Three of the five comments received related to conduct not charged 
in the Complaint. As discussed in more detail infra, review under the 
Tunney Act is confined to the terms of the proposed decree and their 
adequacy as remedies for the violations alleged in the Complaint. 
Public comments and the Court's review are designed to ensure that the 
Department has fashioned relief to the violations alleged in the 
Complaint that it reasonably believes will further the public interest. 
Public comments that relate to conduct that the Department has 
determined not to prosecute are beyond the scope of the Tunney Act 
review procedure, for the reasons and under the law set forth fully at 
section III, below.
    The issues raised by the following three comments therefore are not 
relevant to the Tunney Act determination of whether the proposed decree 
is in the ``public interest.'' Nevertheless, the Department herewith 
provides an explanation to interested members of the public on the 
issues raised.
1. Comment of Anne E. Bogoch, Chan & Jodziewicz
    Anne E. Bogoch, an attorney in the firm Chan & Jodziewicz, 
submitted a comment on behalf of small computer companies who claim to 
have been unlawfully excluded from both the hardware and software 
computer market by Microsoft's monopolization of the personal operating 
system software market. The comment objects to two related Microsoft 
practices: (1) ``Microsoft's tying or bundling of the sale of MS-DOS to 
the purchase of hardware systems'' and (2) Microsoft's ``purported 
licensure to restrict the resale of copies of MS-DOS.'' The comment 
attacks these practices as illegal under two theories. The first relies 
on copyright law, arguing that under the First Sale Doctrine, Microsoft 
cannot restrict the ability of purchases of MS-DOS to resell that MS-
DOS in any manner they see fit. The fact that Microsoft is writing 
license agreements that purport to restrict resale is alleged to be an 
abuse of the copyright and therefore an antitrust violation. Second, 
the comment argues that Microsoft has engaged in illegal tying, by 
conditioning the purchase of the typing product, MS-DOS, on the 
purchase of personal computers: customers are prevented from buying MS-
DOS without a personal computer.
    This comment apparently refers to Microsoft's practice of licensing 
the use of its copyrighted software (Microsoft) to OEMs only for 
distribution with the personal computers sold by those OEMs, and 
subject to license restrictions that prohibit the OEMs from reselling 
the software as a stand-alone product. Microsoft has used this 
licensing policy for many years, and has initiated legal action against 
a number of its licensees alleging that by distributing copies of MS-
DOS that were not sold in conjunction with a computer, the licensee had 
violated the terms of its license and infringed Microsoft's copyrights. 
In a number of these cases, Microsoft has apparently received favorable 
results.
    In general, a firm does not violate the antitrust laws merely by 
enforcing its legitimate intellectual property rights. Thus, to the 
extent that Microsoft's conduct is an instance of legitimately 
exploiting its copyright, there is little reason to challenge that 
conduct as violative of the Sherman Act. Based on the facts that were 
uncovered through its inquiry, the Department did not find a basis for 
challenging under the Sherman Act this aspect of Microsoft's conduct.
    The Department also has not sought to challenge this alleged 
conduct as an illegal tying arrangement under the antitrust laws. 
Microsoft does not sell the allegedly tied product (personal 
computers). This situation does not, therefore, come with the framework 
for illegal tying arrangements.
2. Comment of Micro System Options
    A comment from Micro System Options complaints that the developers 
toolkit for Microsoft's Windows NT 3.5 contains a new, attractive 
feature to create three dimensional images within software 
applications. It expresses concern that Microsoft's next release of 
Windows will include the same feature. Micro System Options apparently 
makes a software product called 3d Graphic Tools which performs 
functions similar to those of the new feature in Microsoft's software 
product(s), and Micro System Options is concerned that the inclusion of 
this new feature in Microsoft software products will reduce demand for 
its own software product.
    The Department's Complaint does not challenge as violations of the 
antitrust laws Microsoft's inclusion of new software features in its 
operating system products. Over the past fourteen years, Microsoft has 
developed and soft numerous successive versions of its operating system 
products, each more advanced and containing more software features than 
the previous one. Whenever Microsoft adds an attractive software 
feature to its operating system products, it reduces the demand for 
software products sold by third parties as a complement to the 
Microsoft product that performed similar functions.
    The proposed Final Judgment, in IV (E), forbids Microsoft from 
licensing covered products\2\ through agreements conditioned on ``(1) 
the licensing of any * * * other product.'' However, this provision 
explicitly states that ``this provision in and of itself shall not be 
construed to prohibit Microsoft from developing integrated products.'' 
The evidence developed by the government during this investigation 
would not, in its view, support a broader injunction. Activity of this 
sort requires case by case analysis, and a broad injunction against 
such behavior generally would not be consistent with the public 
interest.
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    \2\We note that the developers' toolkit for Microsoft Windows NT 
3.5, the product that is the subject of Micro System Options 
comment, is not a ``Covered Product'' as defined by the proposed 
Final Judgment.
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3. Comment of Anthony R. Martin
    A comment from Anthony R. Martin states that since the settlement 
of this case, Microsoft has begun to engage in new and different forms 
of monopolistic conduct. As an example of this, Mr. Martin complains 
that Microsoft is pressuring software suppliers into switching from the 
current version of Windows to the next version of Windows which will be 
released shortly. Mr. Martin suggests that the government may have 
``settled too soon, for too little,'' and that it should reopen its 
investigation.
    The United States does not believe that the possibility that 
Microsoft might in the future engage in new forms of anticompetitive 
behavior is a sufficient reason to reject the proposed Final Judgment 
before the Court now. Obviously, the Department cannot, in a Consent 
Decree, proscribe every conceivable kind of anticompetitive conduct in 
which a firm might engage in the future. It certainly cannot allege in 
a complaint anticompetitive conduct that has not yet occurred. In 
addition, the government cannot be expected to continue its 
investigations and litigation indefinitely, without resolution, on the 
theory that the defendant might, at some point, begin to engage in 
additional anticompetitive practices. The Department considered every 
allegation of anticompetitive behavior that came to its attention 
during the period of its investigation, and brought an action 
challenging the practices that it thought should be challenged on the 
facts then before it. The proposed Decree meets the Department's 
competitive concerns as of the date of filing of the proposed Decree. 
Should Microsoft at some future date begin to engage in new forms of 
anticompetitive conduct, the government can and will initiate a new 
investigation.

B. Comment of IDEA

    One comment does relate directly to the terms of the proposed 
decree. That comment, submitted by IDEA, an OEM which has licensed 
software from Microsoft, contends that its license agreements from 
January 1, 1989 to the present have resulted in more than $2,000,000 in 
prepaid royalties. IDEA suggests that the decree should contain 
provisions ordering Microsoft to refund such prepaid royalties to IDEA 
and similarly situated companies.
    This comment apparently concerns the ``minimum commitment'' feature 
found in the many operating system software licenses Microsoft has 
entered into with OEMs. The minimum commitments create ``take or pay'' 
contracts in which OEM's commit themselves to pay Microsoft not less 
than a particular amount of money in a particular time period.\3\
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    \3\For example, an OEM under a pet-processor license that 
expected to sell 10,000 personal computers a year for the three-year 
term of its license and negotiated a royalty rate of $25 for each 
computer it shipped containing a microprocessor identified in its 
license agreement might have a minimum commitment of $250,000 per 
year. If the OEM only sold 8,000 personal computers in the first 
year, it would still owe Microsoft $250,000. If it sold 11,000, it 
would owe Microsoft $275,000 (11,000 times $25).
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    The proposed Final Judgment prohibits Microsoft from entering into 
license agreements that contain minimum commitments (section IV (F)) 
and from enforcing any minimum commitment in existing license 
agreements (section IV (J) (2)). These prohibitions were included 
because of concerns that minimum commitments could be structured in 
ways that create anticompetitive disincentives for OEMs to make 
incremental purchases of non-Microsoft operating systems. See 
Competitive Impact Statement, pp. 10, 14. In addition, Section IV (I) 
of the proposed Final Judgment provides all OEMs the right to terminate 
existing license agreements for MS-DOS and Windows immediately, without 
penalty. However, the government did not believe that it was necessary, 
in order to create the conditions for competition in the operating 
system software market on an ongoing basis, to require Microsoft to 
refund ``unused'' royalty payments that were paid under minimum 
commitment provisions applicable to contract periods prior to the 
filing of the government's case. The principal goal of the government's 
action was to ensure that OEMs' purchasing decisions in the future 
would not be distorted by the existence of anticompetitive license 
terms. Refunds of royalties paid by OEMs in prior periods would not 
have affected prospective decisions about which operating system 
products they should buy now and in the future. Further, such refunds 
arguably could produce a windfall for some OEMs without producing 
corrective or remedial procompetitive impact.\3\
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    \3\For example, an OEM under a per-processor license that 
expected to sell 10,000 personal computers a year for the three-year 
term of its license and negotiated a royalty rate of $25 for each 
computer it shipped containing a microprocessor identified in its 
license agreement might have a minimum commitment of $250,000 per 
year. If the OEM only sold 8,000 personal computers in the first 
year, it would still owe Microsoft $250,000. It it sold 11,000, it 
would owe Microsoft $275,000 (11,000 times $25).
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C. Comment of J. Adam Burden

    A comment by J. Adam Burden complains about the ``ridiculous action 
brought forth towards Microsoft.'' Mr. Burden contends that Microsoft's 
large market share can be attributed to the fact that software 
developers like to have an operating system standard, and that the 
government has penalized Microsoft for its success.
    As evidenced by the Complaint, proposed Consent Decree, and 
Competitive Impact Statement filed with the Court, the Department 
concluded after an extensive and thorough investigation that specific 
Microsoft practices were unlawfully restraining competition in the PC 
operating system market, and sought to enjoin such practices in the 
proposed Final Judgment. The government's Complaint and the proposed 
Decree do not suggest that Microsoft should be penalized for success or 
merely for obtaining a larget market share.

III. The Legal Standard Governing the Court's Public Interest 
Determination

    When the United States proposes an antitrust consent decree, the 
Tunney Act requires the court to determine whether ``the entry of such 
judgment is in the public interest.'' 15 U.S.C. Sec. 16(e) (1988). In 
making that determination, ``the court's function is not to determine 
whether the resulting array of rights and liabilities `is one that will 
best serve society,' but only to confirm that the resulting `settlement 
is ``within the reaches of the public interest. United States v. 
Western Elec. Co., 993 F.2d 1572, 1576 (D.C. Cir.), cert. denied, 114 
S. Ct. 487 (1993) (quoting, in turn, United States v. Western Elect. 
Co., 900 F.2d 283, 309 (D.C. Cir.), cert. denied, 498 U.S. 911 (1990); 
United States v. Bechtel, 648 F.2d 660, 666 (9th Cir.), cert. denied, 
454 U.S. 1083 (1981); United States v. Gillette Co., 406 F. Supp. 713, 
716 (D. Mass. 1975) emphasis in 993 F. 2d)).\4\
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    \4\The Western Electric decision involved a consensual 
modification of an antitrust decree. The Court of Appeals assumed 
that the Tunney Act standards were applicable in that context.
---------------------------------------------------------------------------

    Thus, under the Tunney Act, the district court plays an important 
but limited role. It properly reviews the government's reasons for 
proposing the decree, as explained in the competitive impact statement 
and the response to comments, to ensure that the government is not 
acting irrationally. But the court may not reject the proposed decree 
``simply because the proposal diverge[s] from its view of the public 
interest.'' Western Elec. Co., 993 F.2d at 1577. Rather, the public 
interest standard requires the court to enter a proposed decree ``that 
the Department * * * reasonably regard[s] as advancing the public 
interest.'' Id. at 1576; see also United States v. Gillette Co., 406 F. 
Supp. 713, 716 (D. Mass. 1975). The court may reject the decree ``only 
if it has exceptional confidence that adverse antitrust consequences 
will result--perhaps akin to the confidence that would justify a court 
in overturning the predictive judgments of an administrative agency.'' 
Western Elect. Co. 993 F.2d at 1577.
    Moreover, review under the Tunney Act is confined to the terms of 
the proposed decree and their adequacy as remedies for the violations 
alleged in the complaint. To the extent that comments raise issues not 
addressed in the complaint, those comments are irrelevant to the 
court's Tunney Act review. The Tunney Act does not contemplate that the 
court will evaluate the wisdom or adequacy of the government's 
complaint or consider what relief might be appropriate for violations 
that the Department has not alleged. In describing the factors that may 
be considered by the court in its public interest determination, the 
Act refers to ``the competitive impact of such judgment'', the 
``termination of alleged violations'' and the impact of the judgment 
upon ``individuals alleging specific injury from the violations set 
forth in the complaint.'' 15 U.S.C. 16(e) (1988) (emphasis added). 
There is no suggestion in the Act that the court should consider 
whether the government should have challenged other practices beyond 
those detailed in its complaint.
    The limitations on the scope of a court's Tunney Act review have 
been explained by two Courts of Appeals. In United States v. Western 
Elec. Co., 900 F.2d 283 (D.C. Cir.), cert denied, 498 U.S. 911 (1990), 
the Court of Appeals for the D.C. Circuit considered whether the public 
interest required the continuation of a consent decree provision 
designed to protect competition in information services markets, 
notwithstanding the agreement of the parties in the case that the 
decree provision should be rescinded.\5\ The court noted that the 
government's case ``centered exclusively on AT&T's activities in the 
interexchange-service and equipment manufacturing markets,'' and did 
not involve the information services market. Id at 307. Because of 
that, the Court of Appeals concluded that if the parties had proposed a 
decree that did not include provisions to protect information services 
markets, that decree nonetheless would have been in the public 
interest. Id. The Ninth Circuit Court of Appeals has recognized the 
same principle: the Tunney Act ``does not authorize a district court to 
base its public interest determination on antitrust concerns in markets 
other than those alleged in the government's complaint.'' United States 
v. BNS Inc., 858 F.2d 456, 462-63 (9th Cir. 1988); see also In re 
International Business Mach. Corp., 687 F.2d 591, 603 (2d Cir. 1982) 
(Department's decision to dismiss without prejudice an antitrust case 
it previously had filed does not require court approval under the 
Tunney Act); United States v. Mercedes-Benz of N. Am., 547 F. Supp. 
399, 400 (N.D. Cal. 1982) (same).
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    \5\Although there is arguably a distinction between the entry of 
a consent judgment and the modification of the consent judgment, 
modifications of the consent judgment in this case generally have 
been governed by Tunney Act procedures and the Tunney Act's public 
interest standard. See Western Elect. Co., 993 F.2d at 1576; Western 
Elec. Co., 900 F.2d at 295; United States v. American Tel. & Tel., 
552 F. Supp. 131, 143 (D.D.C. 1982), aff'd, Maryland v. United 
States 460 U.S. 1001(1983).
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    There are many reasons that might cause the Department not to 
initiate a lawsuit, or to challenge some practices and not others, 
including reasons related to the factual support available for 
potential claims and the enforcement resources that would be required 
to establish them. These decisions are ``peculiarly within [the] 
expertise'' of the Department of Justice, which is ``far better 
equipped then the courts to deal with the many variables involved in 
the proper ordering of its priorities.'' Heckler v. Chaney, 470 U.S. 
821, 831-32 (1985); see also Maryland v. United States, 460 U.S. 1001, 
1006 (1983) (Rehnquist, J., dissenting from summary affirmance) (``How 
is a court to decide whether a better settlement in a case involving 
one industry is more important to the public than the benefits that 
might be gained by immediately working on an antitrust problem in 
another industry?'').
    Finally, Congress did not intend the Tunney Act to lead to 
protracted hearings on the merits, and thereby undermine the incentives 
for defendants and the government to enter into consent judgments. S. 
Rep. No. 298, 93d Cong. 1st Sess. 3 (1973); see United States v. 
American Tel. & Tel. Co., 552 F. Supp. 131, 151 (D.D.C. 1982), aff'd, 
Maryland v. United States, 460 U.S. 1001 (1983). Because it is not the 
function of the court ``to make de novo determination of facts and 
issues'' but rather to determine whether explanations of the Department 
of Justice were ``reasonable under the circumstances,'' United States 
v. Mid-America Dairymen, 1977-1 Trade Cas. (CCH) 61,508, at 71,980 
(W.D. Mo. 1977), courts have consistently refused to consider 
``contentions going to the merits of the underlying claims and 
defenses.'' Bechtel Corp. 648 F.2d at 666.

IV. Conclusion

    The Tunney Act requires that public comments and the government's 
response to those comments be published in the Federal Register. When 
that publication has been accomplished, the government will notify the 
Court that all of the procedures required by the Tunney Act have been 
completed, and will ask the Court to enter the proposed Final Judgment 
based on its determination that the Final Judgment is in the public 
interest.
    The United States is firmly convinced that the proposed Final 
Judgment is in the public interest, and we urge the Court to act 
promptly to ratify that judgment. If the proposed Final Judgment is to 
fulfill its promise of opening the personal computer operating system 
software market, it must be approved without delay. Microsoft has 
agreed to abide by the requirements of the proposed Final Judgment 
pending the Court's Tunney Act review. However, the effectiveness of 
the proposed remedy depends not only on Microsoft's conduct, but on the 
perception of industry participants that the remedy will be approved 
and enforced. OEMs considering alternatives to Microsoft's forthcoming 
Windows '95 product need to know that they may shop the competition 
without paying a royalty to Microsoft for each computer they sell. 
Other operating system suppliers also need to make development and 
marketing decisions with the assurance that Microsoft's per-processor 
and per-system licenses will no longer artificially limit the market 
for their wares. Accordingly, we urge the Court to act promptly to 
approve the proposed Final Judgment following the completion of the 
remaining Tunney Act requirements.

    Dated: October 31, 1994.

    Respectfully submitted,
Anne K. Bingaman,
Assistant Attorney General, Antitrust Division.
Donald J. Russell
John F. Greaney
Gilad Y. Ohana
Lawrence M. Frankel
Dianne Kempt Torresen
U.S. Department of Justice, Antitrust Division, Communications & 
Finance Section, Judiciary Center Building, 555 Fourth Street, NW., 
Washington, DC 20001, (202) 514-5814.
To: Mr. Richard L. Rosen, Chief,
Communications and Finance Section, Department of Justice

Re: Comment, United States v. Microsoft

Attn: Mr. Gil Ohannah, Esq.

Date: Oct. 18, 1994

    As per our phone conversation, I enclose my comment. I will 
forward the final version under separate cover. If it is not 
received in time, please consider the attached my comment.
      Thank you,

      Sincerely,
Anne E. Bogoch, Esq.,
Chan & Jodziewicz.
    ``Society * * * has found it necessary over the centuries to 
restrain those engaged in competition from undue destruction of 
competitors and oppression of consumers. * * * for competition, 
unless supervised, like Cronus, will devour its contending young. 
Cise & Lifland, Understanding Antitrust Laws, PLI, N.Y. 1991 at 4. 
This comment is being filed on behalf of the small computer 
companies who have been unlawfully excluded from both the hardware 
and software computer market by Microsoft's monopolization of the 
personal operating system software market. In this instance of 
voracious market manipulation the small vendors in the computer 
industry are Cronus' children.
    It is the opinion of this author, that although the consent 
decree in United States v. Microsoft was long needed, it has not 
gone far enough, for additional pernicious anticompetitive conduct 
survives, namely Microsoft's tying or bundling of the sale of MS-DOS 
to the purchase of hardware systems and attempting, through contract 
sale and purported licensure to restrict the resale of copies of MS-
DOS.
    Microsoft's bundling restrictions have impacted four different 
segments of the economy; consumers of hardware, consumers of 
software, sellers of hardware and sellers of software. In addition 
because Microsoft's has attempted to impose restrictions upon 
downstream purchasers it has also and most severely affected 
resellers of computer software and hardware, already in a submissive 
market position. Microsoft's monopoly in operating systems has 
effectively precluded the market for other operating systems and 
accompanying applications programs. Consumers who wish to buy from 
small companies which sell hardware and or equip their customers 
with systems to operate their businesses must sell the tied 
accompanying hardware system to which the MS-DOS was originally 
bundled, effectively precluding the consumer from choosing the 
hardware systems.
    In addition, small computer companies are faced with 
insurmountable barriers to access to the market for the sale of 
hardware if they do not have licenses to sell DOS, the operating 
system product used by over 70% of the market and for which most 
application software on the market is written. The only thing a 
small computer seller or reseller can do in the current Microsoft 
regime is resell the goods tied or bundled as per Microsoft's 
purported licensure agreements. This form of restriction on 
alienation is an unlawful extension of federal copyright law's 
monopoly grant and constitutes an antitrust violation.
    The Copyright Act of 1976 grants copyright holders ``the 
exclusive right to distribute copies * * * of [a] copyrighted work 
to the public by `sale' or other transfer of ownership, or by 
rental, lease or lending.'' 17 U.S.C. 106(3). It expressly limits, 
however, this monopoly grant by prohibiting copyright holders from 
imposing any restraints on alienation subsequent to the first sale 
of a copy of a copyrighted work.
    The First Sale Doctrine, a codified exception to the Copyright 
Act's monopoly grant is based on the common law's aversion to the 
restraint of alienation, Sabastian International Inc. v. Consumer 
Contacts (PTY) Ltd., 847 F.2d 1093 (3rd Cir. 1988) and the principle 
that ownership of a material object or copy is distinct from 
ownership of a copyright or intangible, c.f. Mirage Editions, Inc. 
v. Albuquerque A.R.T. Co., 856 F.2d 1341 (9th Cir. 1988). The First 
Sale provision provides that where a copyright owner sells or parts 
with title to a particular copy of a copyrightable work, he divests 
himself of his exclusive right to vend that particular copy, 17 
U.S.C. Section 109(a). Under the First Sale Doctrine, a first sale 
extinguishes the copyright holder's ability to control the course of 
copies placed into the stream of commerce.
    Microsoft seeks to avoid the operation of the First Sale 
Doctrine and unlawfully extend its copyright monopoly beyond what is 
permitted by law by characterizing the sale of copies of MS-DOS as 
licenses. Blanket misuse of the term ``license'' cannot veil the 
fact the distribution of the hard copies of MS-DOS at issue are 
sales.\1\ Microsoft, illegally attempting to control the ultimate 
disposition of the over 70 Million copies of MS-DOS it has placed 
into the marketplace is succeeding in market place power semantics 
at the expense of Constitutional and Congressional copyright policy 
and law.
---------------------------------------------------------------------------

    \1\Cases under the Uniform Commercial Code have consistently 
found contracts between computer companies and vendors, drafted as 
if they were licenses constituted sales of goods within the meaning 
of UCC 2-102 and 2-105. A number of other courts have found that 
contracts for computer software cast in the form of licenses were 
contracts for the sale of goods within the definition of the Uniform 
Commercial Code.'' Advent Systems Ltd. v. Unisys Corp., 925 F.2d 670 
(3rd Cir. 1991); see also Chatlos Systems, Inc. v. National Cash 
Register Corp., 635 F.2d 1081 (3d Cir. 1980) (hardware, software and 
associated services governed by U.S.C.); Carl Beasly Ford, Inc., v. 
Burroughs Corp, 361 F. Supp. 325 (E.D. Pa. 1973) aff'd 493 F.2d 1400 
(3d Cir. 1974) (U.C.C. applied without discussion); c.f. RRX 
Industries, Inc. v. Lab-Con, Inc., 772 F.2d 543 (9th Cir. 1985); 
c.f. Advent Sys, Ltd. v. Unisys Corp., 925 F.2d 670, 674-76 (3d Cir. 
1991).
---------------------------------------------------------------------------

    What Microsoft is doing is not new. The Court of Appeals for the 
Ninth Circuit, in Step-Saver Data System, in finding a similar 
purported license to in fact be a contract for the sale of computer 
software stated:

When form licenses were first developed for software, it was, in 
large part, to avoid the federal copyright law first sale doctrine. 
* * * By characterizing the original transaction between the 
software producer and the software rental company as a license, 
rather than a sale, and by making the license personal and non-
transferable, software producers hoped to avoid the reach of the 
first sale doctrine and to establish a basis in state contract law 
for suing the software rental companies directly. * * * Under the 
amended (copyright) statute, a purchaser of a copy of a copyrighted 
computer program may still sell his copy to another without the 
consent of the copyright holder. This amendment renders the need to 
characterize the original transaction as a license largely 
anachronistic.

    The purchaser of a copy of a computer program enjoys the same 
freedom to transfer a copy as the owner of copies of any other form 
of copyrighted work. Goldstein, Copyright, Vol.1 Section 5.6.1 at p. 
607. A copy of a computer program is a fungible good like any other 
copy of a copyrighted work.

Computer programs are copyrightable intellectual property, but like 
a phono record of a composition, once implanted into a medium and 
widely distributed to computer owners, are merely copies. When 
transferred to a readable, it becomes a readily merchantable 
commodity.

    ``That a computer program may be copyrightable as intellectual 
property does not alter the fact that once in the form of a floppy 
disc or other medium, the program is tangible, moveable and 
available in the marketplace.'' Like a phono record of a musical 
composition, once implanted into a medium and widely distributed to 
computer owners, computer programs become fungible goods.
    The copyright owner who does not wish to encumber subsequent 
distribution of copies, embodying his work can do so by initially 
leasing rather than selling, C.F. Goldstein, Copyright, supra, 
Section 5.6.1, Vol, 1 at 595. However, once there has been a valid 
first sale of a copy of computer program, the First Sale Doctrine 
Act as a defense to any claim of copyright infringement as to 
subsequent purchases.
    While perhaps Microsoft desires to control the ultimate 
disposition of every one of the seventy million odd copies of its 
software in existence, it may not use the copyright laws to do so. 
Congress has decided wisely that when an item is sold, purchaser is 
to take certain minimum rights, among which is the right to resell.
    Patent decisions and copyright costs by analogy have uniformly 
recognized that the purpose of patent law is fulfilled with respect 
to any particular article when the patentee has received his reward 
for the use of his work by the sale of an article or copy, and that 
once that purpose is realized, the patent law affords no basis for 
retaining the use and enjoyment of the thing sold. [Citations 
omitted]. Construing and applying the patent law so as to give 
affect to the public policy which limits the granted monopoly 
strictly to the terms of the statutory grant, the particular form or 
method by which the monopoly is sought to be extended is immaterial. 
The first vending of any article manufactured under a patent or a 
copy of a copyright work puts the article beyond the reach of the 
monopoly which the patent confers. United States v. Univis Leno Co., 
et al., 316 U.S. 241, 251-252 (1942).
    A copyright, like a patent is a statutory grant of monopoly 
privileges. Broadcast Music, Inc. v. Columbia Broadcasting System, 
Inc., 441 U.S. 1, 29, 99 S. Ct. 1551, 1567 (1979). Being a statutory 
grant, the rights are only such as the statute confers, and may be 
enjoined only on the terms and conditions which is specifies. See 
Loew's Inc. v. Columbia Broadcasting System, Inc. A copyright owner, 
like a patentee, may not increase the scope of the monopoly afforded 
by the copyright through a license agreement with a licensee. F.E.L. 
Publications v. Catholic Bishop of Chicago, 506 F. Supp. 1127, 1134 
(N.D. Ill. 1981) (Plaintiff's attempt to extend his copyright 
monopoly to the licensing of not-for-profit performances of 
copyright religious music for worship constituted an antitrust 
violation.) Microsoft's attempt to extend his monopoly beyond that 
conferred by statutory grant constitutes misuse and an antitrust 
violation.
    In addition its attempt to do so in concert with and by 
licensure agreement with hardware manufacturer constitutes a 
conspiracy in violation of the antitrust laws.
    Microsoft's bundling is an illegal tying arrangement, either 
cast as a per se tying or a conspiracy under Section 1 of the 
Sherman Act. Microsoft's ``licenses'' are ``contracts'' within the 
scope of Section 1 of the Sherman Act, as well as its licensing 
practices constituting monopolization under Section 2 of the Sherman 
Act.
    The essential characteristic of an invalid tying arrangement 
lies in the seller's exploitation of its control over the tying 
product to force the buyer into the purchase of tied product that 
the buyer either did not want at all, or might have preferred to 
purchase elsewhere.'' Jefferson Parish Hospital v. Hyde, 466 U.S. 2, 
12, 104 S. Ct., 1551, 1558, 80 L.Ed.2d 2 (1984). A tying arrangement 
violates Section 1 of the Sherman Act and Section 3 of the Clayton 
Act if it is shown to restrain competition unreasonably or is 
illegal per se. Fortner Enterprises v. U.S. Steel Corp., 394 U.S. 
495, 498-500, 89 S. Ct. 1252, 1256-1257, 22 L.Ed.2d 495 (1969).
    The prerequisites of per se illegality are: (1) separate 
products, the purchase of one (tying product) being conditioned on 
purchase of the other (tied product); (2) sufficient economic power 
with respect to the tying product to restrain competition 
appreciably in the tied product; and (3) an effect upon a 
substantial amount of commerce in the tied product. Id. What is 
required in a per section case is not power over the whole market 
for the tying product, but only a ``type of market power [that] has 
sometimes been referred to as leverage * * * defined here as a 
supplier's ability to induce his customers for one product to buy a 
second product from him that would not be purchased solely on the 
merit of that second product.'' Id. at 1559 n.20 quoting V.P. Areeda 
& D. Turner, Antitrust Law, 1134 at 202 (1980). Courts have 
condemned tying arrangements ``when the seller has `market power' to 
force a purchaser to do something that he would not do in a 
competitive market.'' Id. at 1241. Id. at citing United States v. 
Loew's, Inc., 371 U.S. At 45, 83 S. Ct. at 102.
    Microsoft not only has sufficient power, it has a monopoly in 
the MS-DOS/tying product market, that clearly enables it in 
combination with its licensees to restrict competition in the tied 
product. Id. at 1345. ``[T]he mere presence of competing substitutes 
is insufficient to destroy the legal, and indeed the economic, 
distinctiveness of the copyrighted product.'' United States v. 
Loew's, Inc., 371 U.S. At 49, 83 S. Cit. at 104. Id. at 1341.
    In Digidyne v. Data General Corp., 734 F.2d 1336 (9th Cir. 1984) 
and Telerate Systems, Inc. v. Caro., 689 F. Supp. 221, 237 (S.D.N.Y. 
1988). (Id. at 808) the Court of Appeals for the Ninth Circuit and 
the District Court for the Southern District of New York found 
software and CPUs, to be ``separate products,'' for purposes of 
finding tie-ins.
    Digidyne v. Data General Corp., 734 F.2d 1336 (9th Cir. 1984) 
involved litigation between rival computer manufacturers. Data 
General, the defendant, manufactured a computer system called NOVA, 
consisting of a central processing unit (``CPU'') and a disk 
operating system called RDOS. The operating system contained the 
basic commands for operating the system. Data General refused to 
license the RDOS to all except the purchasers of its NOVA hardware. 
The Ninth Circuit held that defendant's refusal to license its 
computer operating system software except to purchasers of central 
processing units of its computer system was an unlawful tying 
arrangement. Stating that tying agreements served hardly any purpose 
beyond the suppression of competition. The Court found that 
conditions such as existed in Digidyne successfully curbed 
competition on the merits with respect to the tied product,'' by 
denying competitors free access to the market for the tied product, 
not because the party imposing the tying requirements has a better 
product or a lower price, but because of his power or leverage in 
another market. At the same time buyers are forced to forego their 
free choice between competing product.'' Id. at 807. Since it is the 
use of ``power or leverage in another market'' which the antitrust 
laws proscribe, the Court reasoned that tie-ins are `unreasonable in 
and of themselves whenever a party has sufficient economic power 
with respect to the tying product to appreciably restrain free 
competition in the market for the tied product and a `not 
insubstantial' amount of interstate commerce is affected.'' ``If 
each of the products may be purchased separately in a competitive 
market, one seller's decision to sell the two in a single package 
imposes no unreasonable restraint on either market particularly if 
competing suppliers are free to sell either the entire package or 
its several parts. Jefferson Parish, 466 U.S. At 12. Microsoft's 
anticompetitive licenses prevent sellers from doing just that. 
Licenses specifically restrict the sale of MS-DOS to circumstances 
where it is tied to an accompanying hardware system.
    Microsoft's contracts with its licensees whereby they have tied 
the purchase of MS-DOS to the purchase of accompanying hardware may 
be seen as a similar conspiracy as those found in patent tying 
United States v. Univis Lens Co., et al., 316 U.S. 241 (1942) and 
patent pooling cases see United States v. General Electric Co., 82 
F. Supp. 753, 814 (D.N.J. 1949) as well as the seminal copyright 
block licensing case of United States v. Paramount Pictures, 334 
U.S. 131, 156-159 (1948).
    Because of Microsoft's monopoly, sellers of software are 
precluded from entering and competing in the market for operating 
software. Because of Microsoft's monopoly, and sellers inability to 
obtain MS-DOS to run it sells, seller is effectively precluded from 
entering a large portion of the hardware market as well. Jefferson 
Parish, 466 U.S. at 14, and increasing the social cost of market 
power by facilitating price discrimination, thereby increasing 
monopoly profits over what they would be absent the tie. Jefferson, 
466 U.S. at 15.
    From the standpoint of the consumer whose interests in the 
statute was especially intended to serve the freedom to select the 
best bargain in the second market is impaired by his need to 
purchase the tying product, and perhaps by the inability to evaluate 
the true cost of either product when they are available only as a 
package. Jefferson, 466 U.S. at 15.
    Microsoft may claim that it limits its licenses to hardware 
companies so severely for valid quality control reasons.
    Microsoft's effort to enlarge the scope of its monopoly by using 
the market power it confers to restrain competition in the market 
for a second product will undermine competition on the merits in 
that second market. Jefferson at 16 citing United States v. 
Paramount Pictures, Inc., 334 U.S. 131, 156-159, 92 L.Ed.2d 1260, 68 
S. Ct. 915 (1948). Such restraint of trade violates the Sherman Act 
Sec. 1.

Richard L. Rosen, Chief,
Communications & Finance Section, Antitrust Division, Room 8104, 555 
Fourth Street NW., Washington, DC 20001.
October 18, 1994.
    Dear Mr. Rosen. This letter refers to the Justice Department's 
Proposed Final Judgment in United States of America vs. Microsoft 
Corporation. I am not certain if this situation is covered. If it 
is, Microsoft is already violating the principles of the consent 
decree. If it is not, I believe it should be included as Prohibited 
Conduct. This is not an isolated case.
    Last week I purchased the developers toolkit for Microsoft's 
Windows NT 3.5 and discovered that Microsoft has included third 
party tools to create three dimensional images within software 
applications free of charge. My product, 3d Graphic Tools, is a tool 
to create three dimensional images within software applications. The 
third party tools included in Windows NT 3.5 were obtained or 
licensed from Silicon Graphics by Microsoft. Further I hear 
(Microsoft will not cooperate and say one way or the other) that a 
version of the same third party tools will be included in the 
upcoming Windows 4.0 release. If this happens my product will be 
dead, because why would anyone pay for something they already get 
free? I think Microsoft's intent by selling this ``package'' is to 
guarantee a market for one software product and squeeze may product 
(and other competing products) out of this market.
    I was under the impression (false) that these third party tools 
would be sold separately. I was an official test site for Windows NT 
3.5 and they were not included by Microsoft in the pre-release 
version of the product in other than an extremely rudimentary form 
which would have required the purchase of additional tool kits from 
other sources. 3d Graphic Tools is not unknown to Microsoft, they 
have two copies in their corporate library which are accessible to 
any employee. We participate in Microsoft's Add-on Developer Tools 
Program and advertise in the Companion Products catalogs which are 
included in Microsoft's product boxes with the Visual Basic and 
Visual C++. (I have included a copy of the most recent catalog for 
Visual C++, my advertisement is on page 15). I think this 
demonstrates that Microsoft is aware of my products. As with other 
small companies this is my sole product. 3d Graphic Tools has been 
available since 1992 to Windows developers and to MacIntosh 
developers since 1988.
    Please contact me if you need further information regarding this 
matter.

      Best Regards,
Mark M. Owen,
Owner, Micro System Options phone 206 868 5418 fax 206 868 7780
cc: Peter Miller, Microsoft Corporation

September 6, 1994.
Anne Bingaman, Deputy Attorney General
Antitrust Division, Department of Justice, Washington, DC 20530, Via 
fax (202) 616-2645.

Re: Microsoft, Inc. Settlement

    Dear Deputy Attorney General Bingaman: I am writing to ask you 
to please send me a set of the settlement documents for the 
Microsoft lawsuit which you recently settled, and also to request 
that you reopen that matter to consider postsettlement conduct by 
Microsoft.
    As I understand the basic parameters of the settlement, you 
sought to ``open up'' access to operating systems. However, I think 
you may have settled too soon, for too little.
    In the wake of your settlement Microsoft appears to have become 
more, not less, predatory. Last week I announced I would fight to 
stop Microsoft from monopolizing use of the word ``windows'' in 
computers. This past Sunday the New York Times carried a story 
indicating Microsoft is trying to strong-arm software suppliers into 
shifting to Windows 4.0 under pain of losing permission to use a 
``compatibility'' logo, thereby forcing both producers and consumers 
of software to incur major expenses without any real need to do so. 
These gestures are the classic activity of a monopolist.
    I believe there is a reasonable, credible basis to believe that 
Microsoft is using your settlement as a sword, not a shield, and has 
gone on to initiate new forms of monopolistic conduct which may not 
be literally touched upon by your settlement. I therefore ask that 
you reopen your investigation and take meaningful steps to ensure a 
level playing field/open marketplace in computer software as well as 
in operating systems.\1\
---------------------------------------------------------------------------

    \1\The Windows 4.0 product is also a new operating system so 
Microsoft is obviously trying to move its antitrust conduct 
downstream from compelled sales to compelled upgrading. I see no 
distinction between each type of anticompetitive conduct. Do you?
---------------------------------------------------------------------------

      Respectfully submitted,
Anthony R. Martin
ARM: sp

w/encl. NYT Sunday Sept. 4, 1994
VIA FACSIMILE AND FEDERAL EXPRESS
(202) 514-6525 (202) 307-6283 (202) 514-6381

October 17, 1994.
Anthony V. Nanni, Section Chief,
P. Terry Lubeck, Section Chief,
Gil Ohana. Esq.
U.S. Department of Justice, Antitrust Division, 10th & Constitution 
Avenue, Washington, DC

RE: United States v. Microsoft Corporation Civil Action No. 94-1564 
Comment in accordance with the Tunney Act

    Dear Messrs. Nanni, Lubeck and Ohana: Under the terms of License 
Agreements (``Agreements'') with Microsoft Corporation 
(``Microsoft'') which cover the period January 1, 1989 to present, 
I.D.E. Corporation (``IDEA'') has paid Microsoft prepaid royalties 
which now exceed Two Million ($2,000,000.00). The Agreements 
expressly state that these prepaid royalties may never be refunded 
to IDEA by Microsoft. Although the Agreement provides that prepaid 
royalties may be recoupable against actual earned royalties in 
excess of IDEA's minimum commitment payments, it is virtually 
impossible that these prepaid royalties shall ever be recouped as 
set forth in the Agreement.
    Although the Consent Decree (``Decree'') grants IDEA the ability 
to renegotiate the terms of our Agreements, the Decree does not 
grant us a remedy for the recovery of $2,000,000 of prepaid 
royalties. IDEA has been able to obtain a firm commitment from 
Microsoft on a refund of the prepaid royalties. It is our sincere 
belief that Microsoft will not refund prepaid royalties unless they 
are so ordered. We therefore respectfully request that the Final 
Decree contain such a remedy to IDEA and similarly situated 
companies.
      Sincerely,
Wanda Washington,
Corporate Counsel.
cc: Gautam Gupta, President
David Hunter, Vice President
David Page, Vice President
VIA FACSIMILE AND FEDERAL EXPRESS
(202) 514-6525 (202) 307-6283 (202) 514-6381
October 18, 1994.
Anthony V. Nanni, Section Chief
P. Terry Lubeck, Section Chief
Gil Ohana, Esq.
    U.S. Department of Justice, Antitrust Division, 10th & 
Constitution Avenue, Washington, DC.

RE: United States v. Microsoft Corporation Civil Action No. 94-1564 
Comment in accordance with the Tunney Act

    Dear Messrs. Nanni, Lubeck and Ohana: In furtherance of comments 
provided to your office dated October 17, 1994, we have enclosed a 
copy of a draft Amendment submitted to I.D.E. Corporation (``IDEA'') 
by Microsoft Corporation (``Microsoft''). As was stated in our 
earlier comments, although the Consent Decree (``Decree'') grants 
IDEA the ability to renegotiate the terms of our Agreements, the 
Decree does not grant us a remedy for the recovery of $2,000,000 of 
prepaid royalties.
    The attached draft Amendment evidences Microsoft's unwillingness 
to refund prepaid royalties. This Amendment indicates that:

    ``*  *  * prepaid royalties shall be recoupable against earned 
royalties * * * only to the extent such prepaid royalties could have 
been recouped had the minimum commitment payments existing prior to 
the Amendment remained in effect.''

    I therefore submit that by amending existing agreements in this 
manner Microsoft continues to impose minimum commitments and does 
not comply with the Decree which requires that it discontinue its 
practice of imposing minimum commitments. Again, we respectfully 
request that the Final Decree stipulate a remedy to IDEA and 
similarly situated companies with respect to prepaid royalties. 
Microsoft's most recent draft Amendment supports our belief that 
Microsoft will not refund prepaid royalties unless they are so 
ordered.
      Sincerely,
Wanda Washington,
Corporate Counsel.
Janet Reno, Attorney General #4400,
Department of Justice, Constitution Ave. and 10th St., NW., 
Washington, DC 20530.
July 25, 1994.

    To whom it may concern: This letter is being written in regards 
to the ridiculous action brought forth towards Microsoft. Is it 
Microsoft's fault that they have produced a product that is popular 
due to the ease in which it takes to operate it?
    In the statement issued from the Justice department it states 
that Microsoft has a 70% market share. If it was a monopoly, should 
that number not be around 90-95%? To me it looks a little strange to 
have the Vice-President promoting the Information Super-Highway and 
the Justice Department going after a company that will help provide 
a user friendly interface for ``computer novices'' to use in order 
to navigate the highway with. One reason that Microsoft has such a 
large market share is that software developers would like to have an 
operating system standard. Can you imagine the cost for developing 
an application in 3 or 4 different formats? I believe that this 
would cripple trade far more than the fact that Microsoft has 70% of 
the market share. This clearly shows that in America you get 
penalized for success.
      Sincerely,
J. Adam Burden.
    Internet address: [email protected]
[FR Doc. 94-28441 Filed 11-16-94; 8:45 am]
BILLING CODE 4410-01-M