IP: MS/DoJ Settlement: "The Killer Clause"

[David Farber <dave () farber net>]

> Date: Sat, 03 Nov 2001 16:11:40 -0700
> To: farber () cis upenn edu
> From: Brett Glass <brett () lariat org>
> Subject: MS/DoJ Settlement: "The Killer Clause"
>
> Dave:
>
> I'm not sure how many people have noticed it yet, but the proposed 
> settlement agreement
> between the DoJ and Microsoft (see 
> http://news.cnet.com/news/0-1003-201-7758181-1.html) contains a "killer 
> clause" that, notwithstanding the rest of the verbiage, would let 
> Microsoft crush competitors at will. This text, buried in the 
> "definitions" near the end of the agreement, says, "The software code that 
> comprises a Windows Operating System Product shall be determined by 
> Microsoft in its sole discretion."
>
> In short, anything which Microsoft declares to be a part of Windows must, 
> as a result of the agreement, be considered by the Government to be part 
> of Windows.
>
> Let's look at the potential effects of this clause. Suppose that a new 
> company -- let's call it "ScapeNet" -- comes out with a fantastic, new 
> "must-have" application program that Microsoft sees as a threat to its 
> software dominance.
>
> No longer would Microsoft have to worry about being perceived as "dumping" 
> a competitive product on the market to put a rival out of business. It 
> could simply say that its new product was "a part of Windows" or "an 
> improvement to Windows" -- even if it was released or distributed 
> separately. The government could not complain no matter how many 
> competitors were snuffed out in this manner.
>
> Thus, the proposed settlement agreement is not just ineffective but is 
> actually dangerous to free competition in the software industry.
>
> The DoJ was tripped up once before -- in 1995 -- when similar language was 
> inserted into a previous consent decree. Will the government be fooled again?
>
> --Brett Glass


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