Microsoft Accused of Antitrust Violations in Lawsuit with Netscape

The Justice Department, led by Assistant Attorney General Joel Klein, has announced a broad antitrust lawsuit against Microsoft, alleging that the software giant engaged in anti-competitive practices to maintain its Windows monopoly. According to Klein, Microsoft attempted to negotiate an agreement with Netscape to share the internet browser market, but when Netscape refused, Microsoft used its market power to "cut off Netscape's air supply" by denying access to distribution channels and forcing its own browser onto computers.

Key Takeaways:

• Microsoft allegedly attempted to negotiate an agreement with Netscape to share the internet browser market, but when Netscape refused, Microsoft used its market power to exclude Netscape from the market.
• Microsoft used its Windows monopoly to deny Netscape access to distribution channels, including forcing its own browser onto all new PCs using Windows.
• Microsoft entered into contracts with major internet and online service companies, such as America Online, to disadvantage Netscape.
• The Justice Department is seeking a preliminary injunction to force Microsoft to include the Netscape internet browser on Windows 98, or to install no browser at all on the operating system.
• Microsoft's Windows operating system is installed on about 90% of personal computers before sale.

Statistics:

• 90% of computer makers and vendors install the Windows operating system onto personal computers before sale.
• Microsoft allegedly used its Windows monopoly to "cut off Netscape's air supply" by denying access to distribution channels.
• The Justice Department is seeking a preliminary injunction to force Microsoft to include the Netscape internet browser on Windows 98.

Sources:

• United Press International, "Microsoft accused of antitrust violations in lawsuit with Netscape" (May 18, 1998)