Microsoft Sticks to Two-Way Breakup Proposal Amid Federal Antitrust Lawsuit

Strategic Insights -

The US Justice Department has stood firm on its original proposal to split software giant Microsoft into two companies, despite a suggestion by US District Judge Thomas Penfield Jackson to consider a three-way breakup. The revised remedy, submitted to the judge on Friday, maintains the core elements of the government's original plan, including the separation of Microsoft into two companies, one selling the dominant Windows operating system and the other responsible for all other Microsoft products and services. The plan's minor revisions include lengthening the time before a final judgment takes effect and narrowing the group of major stockholders barred from holding stock in both companies.

Key Takeaways:

  • The US Justice Department has reaffirmed its proposal to split Microsoft into two companies in response to the company's alleged antitrust violations.
  • The revised plan maintains the original proposal's core elements, including the separation of Microsoft into two companies and the dominance of one company in the Windows operating system market.
  • The plan includes minor revisions, including lengthening the time before a final judgment takes effect to 90 days and narrowing the group of major stockholders barred from holding stock in both companies.
  • Microsoft's plans to appeal the ruling, insisting its actions were not illegal and disputing the government's basis for the proposal.
  • The government's original proposal was submitted as a remedy to Microsoft's alleged antitrust violations, following a ruling by US District Judge Thomas Penfield Jackson on April 3.
  • Microsoft's breakup would be the most significant restructuring in the company's history, affecting its global operations and market presence.

Statistics:

  • 48 hours: the time frame Microsoft has to respond to the government's revised proposal.
  • 90 days: the lengthened period of time before a final judgment would take effect, as proposed in the revised plan.
  • 5 percent: the new threshold of major stockholders barred from holding stock in both companies, up from the original 3 percent.
  • 30 days: the original time frame before a final judgment would take effect, as proposed in the government's original plan.
  • April 3: the date when US District Judge Thomas Penfield Jackson found Microsoft in violation of the federal antitrust law.

Sources:

  • XINHUA
  • COMTEX (http://www.comtexnews.com)