Microsoft Withdraws from $300 Million California State University Project

The Microsoft Corporation has pulled out of a $300 million project to build a high-speed computer network for the California State University system, citing a gap between the university's expectations and what Microsoft could supply. The ambitious partnership, known as the California Educational Technology Initiative (CETI), aimed to link the 22 campuses of the nation's largest university network and generate substantial revenues from selling products and services to 345,000 students and 38,000 faculty and staff members.

However, the project faced intense criticism from students, staff, and faculty members, who attacked it as anti-competitive and a threat to the principles of higher education. Microsoft's withdrawal comes amid the company's investigation by the Justice Department for possible antitrust violations. Other partners, including Hughes Electronics Corporation, a unit of General Motors, have also dropped out, leaving GTE and Fujitsu as the remaining private players.

Key Takeaways:

• Microsoft withdrew from the $300 million California State University project due to a gap between the university's expectations and what Microsoft could supply.
• The project, known as the California Educational Technology Initiative (CETI), aimed to link 22 campuses and generate revenues from selling products and services to 345,000 students and 38,000 faculty and staff members.
• Critics attacked the project as anti-competitive and a threat to the principles of higher education, amid Microsoft's investigation by the Justice Department for possible antitrust violations.
• Other partners, including Hughes Electronics Corporation, a unit of General Motors, have dropped out of the project, leaving GTE and Fujitsu as the remaining private players.
• The project's fate is uncertain, with Chancellor Charles B. Reed stating that the state is unable to provide the $300 million needed to build the technology infrastructure.
• Microsoft's withdrawal has sparked debate on the role of private sector investment in public education and the potential competitive implications of such partnerships.

Statistics:

• $300 million: The estimated cost of the California Educational Technology Initiative (CETI) project.
• 22: The number of campuses linked by the high-speed computer network.
• 345,000: The number of students at the California State University system.
• 38,000: The number of faculty and staff members at the California State University system.

Sources:

• "Microsoft Withdraws from Calif. State U. Project" by The Los Angeles Times, date not specified.
• Investigation by the Justice Department for possible antitrust violations against Microsoft, not specified in the source.
• Charles B. Reed, Chancellor of the California State University system, March.
• Elizabeth W. King, General Manager of Microsoft's Educational Customer Unit.