Economist balks at plan for Microsoft

He expresses doubts about states' proposal

April 12, 2002|By BLOOMBERG NEWS

WASHINGTON - The economist for nine states seeking tough antitrust remedies against Microsoft Corp. withheld support yesterday from their proposal to give computer makers the choice of removing Microsoft programs from the Windows operating system.

Carl Shapiro, testifying as the states' economics expert at court hearings on remedy proposals, said he could not determine whether it would help software competition to force Microsoft to make a "modular" version of Windows to enable computer makers to extract programs like Internet Explorer and the Windows Media Player.

Microsoft lawyer Michael Lacovara questioned Shapiro about the omission from written testimony that endorses other state proposals and attacks as inadequate the proposed settlement of the 4-year-old U.S. Justice Department lawsuit against the software maker.

"You don't believe the unbinding remedy proposed by the states will help competition," Lacovara asked.

"It's a difficult call, I don't know the answer," replied Shapiro, a University of California economist. "It's a thorny area."

Shapiro said their other proposals are needed to prevent Microsoft from controlling software that powers new products such as hand-held computers and cellular phones to protect its Windows operating software, which powers 95 percent of the world's personal computers.

The nine states challenging the settlement - California, Connecticut, Florida, Iowa, Kansas, Massachusetts, Minnesota, Utah, West Virginia - are trying to persuade U.S. District Judge Colleen Kollar-Kotelly that the settlement negotiated last year won't prevent Microsoft from dominating Internet software.

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