Microsoft makes moves to settle

Microsoft has submitted a proposal to the US Department of Justice and state attorneys general to settle antitrust charges, but one official has described it as inadequate, according to a published report today.

Dow Jones reported that Iowa Attorney General Tom Miller received the proposal and described it to a fellow attorney general as not going far enough. It is "far from what anyone in our group would expect to be adequate," Bill Lockyer, California attorney general, said Miller told him. Lockyer said he had not seen the proposal.

According to Dow Jones, Microsoft indicates in its proposal that it is willing to loosen its contracts with OEMs (original equipment manufacturers) and alter contracts with computer makers and ISPs to eliminate the portions that require exclusive or near-exclusive distribution of its products. The contracts have been at the heart of the case against the software giant, which was accused of using its monopoly in desktop software to gain dominance in the Internet market.

However, the report says, Microsoft's proposal avoids concessions on the issue of product integration, a second key point in the case. The government claims Microsoft's bundling of its Internet Explorer browser with its Windows operating system was anticompetitive.

Representatives from the 19 attorneys general offices that filed the lawsuit will meet in Washington, D.C., tomorrow to consider the offer, according to Dow Jones. The proposal has circulated among them and the DoJ for the past day or so, according to the report.

West Virginia Attorney General Darrell McGraw said today that he had not heard of any settlement discussions, but said any move toward one would have to involve both the state attorneys general and the federal government. "The federal government has carried the load in this case and it would be unseemly not to include it," he said.

Microsoft had no comment when asked whether or not the company is in settlement discussions with government officials. "We believe that we need to proceed in a confidential way in this matter," said spokesman Jim Cullinan.

The DoJ also had no comment. "This is something that should be worked out solely between the two parties involved," said DoJ spokeswoman Gina Talamona.

Earlier today Reuters reported that in an interview with David Frost at an investor conference in New York, Bill Gates, said the company was currently in talks with the US Government in the hopes of coming to a settlement.

"There are ongoing discussions and I won't speculate as to the probabilities or anything, but I hope that it does get settled," Reuters quoted Gates as saying.

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