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2 | DEPARTMENT OF JUSTICE |
3 | PRESS CONFERENCE |
4 | With Attorney General Janet Reno and |
5 | Assistant Attorney General Anne Bingaman |
6 | Regarding the Microsoft Settlement |
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8 | Saturday, July 16, 1994 |
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13 | (Transcribed from a provided audiotape.) |
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1 | PROCEEDINGS |
2 | ATTORNEY GENERAL RENO: Good afternoon. |
3 | The Justice Department has charged Microsoft, the |
4 | world's largest software company, with using unfair |
5 | marketing and contracting practices to choke off competition |
6 | to preserve its monopoly position. Microsoft has agreed, |
7 | yesterday, to settle the charges with a consent decree that |
8 | will prohibit the company from continuing to engage in |
9 | monopolistic practices in the future. |
10 | While the company fairly and lawfully climbed to |
11 | the top of the industry ladder, it used unfair and illegal |
12 | practices to maintain its dominant position, and kept honest |
13 | competition from other U.S. companies. |
14 | The Justice Department has taken an action that |
15 | is critical to the personal computer industry and the |
16 | efforts to make it competitive. This settlement will save |
17 | consumers money, enable them to have a choice when selecting |
18 | PC operating systems, and it will stimulate innovation in |
19 | this critical market. |
20 | Today's settlement is the result of close |
21 | coordination between the Department of Justice and the |
22 | Competition Enforcement Authorities of the European |
23 | Commission, which, today, also has indicated an undertaking |
24 | containing essentially the same terms. |
25 | This complaint and settlement marks the first |
1 | coordinated effort of the two enforcement bodies in |
2 | initiating and settling an antitrust enforcement action. |
3 | I want to thank and to recognize Anne Bingaman and |
4 | the fine staff of the Antitrust Division, who have worked |
5 | through long hours of negotiations to resolve quickly this |
6 | significant case, and achieve the best results for the |
7 | consumers of America. |
8 | And now I would like to ask Anne -- |
9 | MS. BINGAMAN: Thank you. |
10 | We are proud of the achievement that the |
11 | settlement filed in Federal District Court in Washington, |
12 | the District of Columbia, at 9:30 last night represents. |
13 | It is a significant -- in fact, historic -- breakthrough for |
14 | the software industry, for innovation, for the |
15 | competitiveness of the American economy. |
16 | Let me describe for you briefly what the case we |
17 | filed is about and what the settlement achieves, because |
18 | they are significant. |
19 | Number one, the settlement will open the playing |
20 | field; it will level the playing field for Microsoft's |
21 | competitors in the operating system software market, to |
22 | enter this important market, to bring down prices to |
23 | consumers, to innovate, to produce better products. |
24 | Microsoft, for years, and has today, monopoly |
25 | power in the software -- operating system software market. |
1 | As this chart shows, Microsoft has 79-plus percent of that |
2 | market. Its competitors are other American companies who |
3 | have been struggling for years to enter this market to |
4 | provide better, cheaper products to American consumers, and |
5 | Microsoft's contracting practices, which are challenged in |
6 | this lawsuit and which are ended by the settlement we |
7 | achieved, have prevented those competitors from entering the |
8 | market. They have deprived consumers of choice. And they |
9 | have stopped innovation -- slowed innovation in this |
10 | important market. |
11 | Let me describe to you the four major things that |
12 | Microsoft did and which this settlement ends. |
13 | Number one, the per-processor license, I'll |
14 | describe in a moment. |
15 | Number two, contracts of extraordinarily long |
16 | duration which blocks the market. |
17 | Number three, huge, 100 percent minimum |
18 | commitments for years, which amounted to take-or-pay |
19 | contracts, which blocked the market. |
20 | And, four, restrictive non-disclosure agreements |
21 | for software writers which prevented them from writing for |
22 | other software companies in some cases. |
23 | Let me turn first to the per-processor license, |
24 | what that is and what this settlement does to stop it. |
25 | Number one, the settlement bans it outright. That |
1 | is first. What the per-processor license has done until |
2 | last night at 9:30 was to lock up 60 percent of this market |
3 | in the United States in per-processor contracts which |
4 | Microsoft began using in 1988. Per-processor contracts are |
5 | contracts which Microsoft imposed by virtue of its dominant |
6 | monopoly position on computer manufacturers, such as Dell, |
7 | Compaq, Gateway, you name it, the OEM's they are called in |
8 | the business, the computer makers, who have to license from |
9 | Microsoft because it has had this monopoly position and the |
10 | products are demanded in the marketplace. |
11 | Nothing wrong with that, but rather than simply |
12 | sell those products fair and square on the merits and on |
13 | price, in 1988, Microsoft invented a form of contracting |
14 | called the per-processor license, under which it required |
15 | the computer manufacturers -- induced them with extremely |
16 | low prices to pay for every processor they shipped of a |
17 | certain type not just to Microsoft, but to the competitors. |
18 | So it worked this way: Under a per-processor |
19 | license, which 60 percent of the industry has had until last |
20 | night, Microsoft got paid for every processor shipped by a |
21 | computer maker, whether or not that processor had a |
22 | Microsoft operating system loaded on it. |
23 | Now, if you are a competitor of Microsoft and you |
24 | wanted to sell your competing product to a consumer, you do |
25 | that through these computer manufacturers. But they had to |
1 | pay Microsoft. |
2 | Now, if Microsoft -- take this hypothetical -- |
3 | operating system was $15, and you came in with a better |
4 | operating system or cheaper, it worked just as well, |
5 | hypothetically $10 -- these numbers are lower than average, |
6 | but for ease -- under the per-processor license, the |
7 | computer manufacturer pays Microsoft 15 and the competitor |
8 | 10 for a total of $25 on what really is a $10 item. |
9 | The result, computer manufacturer were reluctant |
10 | -- extremely reluctant -- to buy from competitors. And that |
11 | was the purpose and the effect of the per-processor license. |
12 | It's obvious what it does. It drives prices up to |
13 | consumers. It raises prices. It locks out competitors. |
14 | And it slows innovation. |
15 | So, this settlement stops the per-processor |
16 | license. |
17 | Two, Microsoft used contracts of three to five |
18 | years in an industry that was rapidly turning over. These |
19 | extraordinarily long contracts made it very difficult for |
20 | competitors to get in. The settlement we achieved today |
21 | reduces contract lengths to one year, with one, one-year |
22 | extension on the same terms and conditions which the |
23 | computer manufacturer, in its sole option, can elect. |
24 | So, we have gone to one-year contracts, banning |
25 | of per-processor. |
1 | The third important feature of this settlement is |
2 | abolishing minimum commitments. Microsoft's third way to |
3 | lock up this market was to say to the computer makers who |
4 | had to deal with it, We will give you a lower price if you |
5 | estimate a large volume. |
6 | Nothing inherently wrong with that volume |
7 | discounting. The problem is Microsoft quoted these low |
8 | prices in conjunction with 100 percent minimum commitments |
9 | -- i.e., you get that price only if you sign on the dotted |
10 | line to pay us every cent regardless of whether you actually |
11 | ship our product or not -- a take-or-pay contract. You pay |
12 | no matter what. |
13 | Well, what does that mean? |
14 | Over a long-term contract, what that means is if |
15 | the computer manufacturer's business has not gone quite as |
16 | well as it thought, it is locked into Microsoft no matter |
17 | what because it owes them this minimum commitment, even if |
18 | it has not sold any machines. So, minimum commitments was |
19 | a third way that Microsoft locked up this market, locked out |
20 | competitors, and minimum commitments are abolished. They |
21 | are zero in the settlement we achieved yesterday. |
22 | Finally, NDA's, non-disclosure agreements, were |
23 | restrictive agreements which Microsoft, this winter, imposed |
24 | in a manner that had never been done before in the software |
25 | industry on certain applications writers. It would have -- |
1 | the NDA's challenged in this lawsuit and which Microsoft in |
2 | the consent decree agrees to stop would have prevented |
3 | applications writers from discussing Microsoft's operating |
4 | systems for as long as three years after public disclosure |
5 | of the operating system. |
6 | The effect could take those application writers, |
7 | the software writers, forever out of business, in effect, |
8 | except for Microsoft. It is another way to, in effect, lock |
9 | up the market -- this time by locking up the important |
10 | software applications writers. |
11 | Microsoft itself has said these NDA's were a |
12 | mistake. It has agreed in this consent decree to never |
13 | engage in such practices while this consent decree is in |
14 | effect. And that also is a significant achievement of this |
15 | settlement. |
16 | The last thing the settlement does is prohibit the |
17 | use of lump-sum contracts, which would have been another way |
18 | that Microsoft could have locked up this market. They had |
19 | not needed to use them in the past because they had these |
20 | other methods, but looking forward, our concern was that |
21 | they might. And so the settlement also bans lump-sum |
22 | contracts. |
23 | This settlement is everything we could have hoped |
24 | for in a fully litigated case and possibly more. It is an |
25 | historic achievement. I tell you, the charts we have |
1 | prepared today were prepared for the lawsuit we planned to |
2 | file yesterday. The lawsuit was not filed because of the |
3 | settlement. We filed instead a complaint with a settlement. |
4 | We are extremely proud of this result. |
5 | And the last point that the Attorney General |
6 | noted, I think, deserves mention. This is the first time |
7 | in history that the Competition Authorities of the European |
8 | Commission and the Department of Justice have cooperated |
9 | closely in investigating a major worldwide company, whose |
10 | anti-competitive practices affected important markets both |
11 | in Europe and the United States. |
12 | We took this under a letter -- the EC and I and |
13 | the Department of Justice asked Microsoft last October to |
14 | waive any confidentiality restrictions under our respective |
15 | statutes so that we could work together and think about the |
16 | case we were jointly -- not jointly to them -- but that we |
17 | had each initiated. Microsoft agreed to that in writing. |
18 | We worked with the EC throughout the winter. We |
19 | shared documents. We worked closely with them. We settled |
20 | this together on terms that are substantially identical. |
21 | We negotiated in Brussels the week of July 4th with |
22 | Microsoft. We negotiated this week at the Department of |
23 | Justice with EC officials here. And this also is a truly |
24 | historic aspect of this settlement. |
25 | So, we are extremely proud of this. We are |
1 | gratified that it concluded with a consent decree which |
2 | achieves the really 100 percent results that any lawsuit |
3 | could have achieved, and possibly more. And I want to |
4 | especially note that this was the ultimate team effort. We |
5 | had a group of lawyers, led by Sam Miller, who is here |
6 | today, and Don Russell, who is on his way back from Brussels |
7 | -- he has been in Brussels all week coordinating this hour |
8 | by hour with the EC over there -- we have had extraordinary |
9 | people on this case. We had a team of lawyers I would put |
10 | against anybody, and I would feel for the other side. |
11 | And I want to simply state the names on the |
12 | complaint we filed last night, because I am so proud to have |
13 | been part of this group. The complaint was signed by Sam |
14 | Miller, Don Russell, Joyce Bartu, Bob Zastrow, Dick Irvin, |
15 | Peter Gray, Justin Dempsey, Gil O'Hana, and Larry Frankel. |
16 | And there were more, and we had a paralegals. And this was |
17 | an effort of a remarkable, extraordinary, incredible group |
18 | of lawyers that I am so proud to have been part of. And I |
19 | am proud of our partnership with the EC. |
20 | So, with that, what can I tell you about any |
21 | questions you have? |
22 | QUESTION: What kind of room does this give |
23 | Microsoft's competitors -- (inaudible) -- civil actions? |
24 | MS. BINGAMAN: That is up to the competitors. I |
25 | do not actually believe this case changes the legal status |
1 | of any competitor's suit, because, by settling, Microsoft |
2 | has admitted to no facts. It has consented to entry of the |
3 | decree that was filed with our complaint. But facts are not |
4 | established of record by a settlement, the way they are by |
5 | a litigated case to conclusion, with a jury trial. |
6 | So, my own horseback impression is that the |
7 | action, as such, does not change the legal status. But, as |
8 | far as private suits by competitors, it has enormous impact |
9 | for competitors in opening the market. This is exactly what |
10 | has been needed for years and years in the software |
11 | industry. And I think, in the market-opening respects and |
12 | for innovation, prices to consumers, it will have tremendous |
13 | impact. |
14 | QUESTION: Why has this taken so long, and why is |
15 | there no monetary penalty? And I notice it says that -- you |
16 | say in the press release that it bans these practices in the |
17 | future, but then says it only lasts six-and-a-half years. |
18 | MS. BINGAMAN: Okay. You have got several |
19 | questions there. Number one, we have had this case for a |
20 | little less than one year. The FTC had it for, I think, |
21 | two-and-a-half or three years before that. As everyone |
22 | knows, or a lot of people, the FTC deadlocked two to two. |
23 | We took the case acting as a fifth commissioner. We have |
24 | looked carefully at this case because it is an important |
25 | case, and we wanted to understand it fully ourselves. |
1 | So, I have no concerns whatsoever about a one-year |
2 | action by the Justice Department that ends these practices. |
3 | There are no monetary penalties because they are |
4 | not provided by any law and never have been. When the |
5 | Justice Department settles a civil case, the Antitrust |
6 | Division -- the antitrust laws do not provide for civil |
7 | penalties, period. |
8 | We obtain adjunctive reliefs to open the market. |
9 | Under the American legal system, private actions obtain any |
10 | monetary damages, and that is just the way it is in all of |
11 | our cases. They are no different. |
12 | You had a third aspect. |
13 | QUESTION: The length of time, you say -- |
14 | MS. BINGAMAN: Oh, the six-and-a-half years. Our |
15 | decrees normally last 10 years. We negotiated long and hard |
16 | with Microsoft over the length of the decree. The EC's |
17 | decrees last four-and-a-half years. We obtained immediate |
18 | effect of this decree. That was a crucial aspect of the |
19 | decree. And we believe we added, in effect, three to |
20 | three-and-a-half years on the front end of the decree |
21 | because the contract duration stops right now. The |
22 | per-processor stops as of last night. |
23 | The illegal practices that had locked up the |
24 | market are ended. And they do not have to wait for |
25 | contracts now in effect to run out. And it was our belief |
1 | that based on all of those facts, plus the EC's practice of |
2 | four-and-a-half year decrees, that this was a fair balance |
3 | under the circumstances. |
4 | Let me mention something. I neglected to thank |
5 | -- and it was a major oversight on my part and I want to |
6 | correct it -- Henry Kawati is sitting here, who worked long |
7 | and hard on this case, he is an economist with our Economic |
8 | Section; Rich Gilbert, who is head of that section, was in |
9 | Brussels with me; and Mark Schecter, who killed himself on |
10 | the case, along with Bob Lighten, but I want to thank Henry |
11 | Kawati and Ken Hire and Rich Gilbert, because the economics |
12 | aspect of this case, as you can imagine, was critical. We |
13 | had outstanding outside economists who Henry worked with |
14 | tirelessly for many, many months. And he was a critical |
15 | part of it, as was Rich Gilbert and Ken. So, I wanted to |
16 | say that. |
17 | QUESTION: Can you estimate how much these |
18 | practices may have cost consumers over the years? |
19 | MS. BINGAMAN: We have not. Because we do not |
20 | bring damage actions, we do not put efforts into trying to |
21 | figure out monetary total impact. But I can, to illustrate, |
22 | tell you this. If you were a consumer and wanted to buy a |
23 | competing operating system, and despite Microsoft's |
24 | practices, there have been, in fact, four major competitors |
25 | in this market to Microsoft, who have clawed and grabbed and |
1 | have managed to obtain some market share, if you bought one |
2 | of those competing companies, and 20 percent of the American |
3 | public does, and you were under a per-processor license, and |
4 | many of these licenses, as we saw, are per-processor, you |
5 | paid not just Microsoft anywhere from $15 to $50 for its |
6 | operating system, you paid the competing price on top of |
7 | that. |
8 | And so Microsoft, in effect, taxed every consumer |
9 | who bought a competing operating system and bought it from |
10 | a maker who had one of these per-processor contracts, or a |
11 | similar one. And so it's not insignificant. We have not, |
12 | as I said, made any effort to quantify it, but it is -- |
13 | there are millions and tens of millions of PC's shipped |
14 | every year, and it is a major amount of money. |
15 | We can try to come up with some numbers after the |
16 | press conference. But with all the other things we have |
17 | done, that has not -- our focus has been opening the market, |
18 | truly, and obtaining the relief we needed. |
19 | QUESTION: To follow that up, do you have any |
20 | estimate of how many computers were shipped under these |
21 | agreements that would have been effected? |
22 | MS. BINGAMAN: I can come up with numbers on that. |
23 | We have not tried to. It is in the tens of millions. There |
24 | are 120 million total computers with Microsoft operating |
25 | systems on them. Many, many were shipped with this -- under |
1 | these kinds of practices. And it has been a major market |
2 | problem for competitors, and has restricted choice for |
3 | consumers. |
4 | Let me tell you why else this is so important to |
5 | the American economy. We are about innovation and |
6 | competition in this economy. That is what we are for. And |
7 | Microsoft has its shot at the market. No problem. All we |
8 | are saying is others should have their shot at the market, |
9 | fair and square, a level playing field. That is the |
10 | American way. |
11 | And they may have a better mousetrap. They may |
12 | not. But what we are saying is people should get a chance |
13 | to judge it fairly on quality and price and the other |
14 | factors. And that is what this case is about. It levels |
15 | the playing field, opens the door. |
16 | And if a competitor has a better product that can |
17 | run computers faster, run them better, support better |
18 | applications, build a base, cut into Microsoft's market |
19 | share so that applications writers will write for it, that |
20 | could have profound consequences for the American economy. |
21 | What we are about is precisely that -- promoting |
22 | competition, innovation, better products at cheaper prices, |
23 | and letting the market take care of whatever happens. |
24 | We are not about driving the market; we are about |
25 | letting the market operate freely. |
1 | QUESTION: Had this settlement not been reached, |
2 | what broader or further action could Microsoft have been |
3 | subjected to? And, a second question is, had there been any |
4 | serious consideration about splitting Microsoft into two? |
5 | MS. BINGAMAN: I cannot discuss our internal |
6 | considerations as such. I can tell you that we looked at |
7 | every possible legal theory and at all the facts throughout |
8 | the course of a long, tough winter, that the legal team I |
9 | mentioned went through. And it was our conclusion at the |
10 | end of that that the case to be filed was the case we did |
11 | file. We did not bargain off any case in exchange for a |
12 | settlement. This was the case that was there after |
13 | thousands of hours of work. And it needed to be brought, |
14 | and it was brought. |
15 | And that is really as much as I think |
16 | confidentiality permits me to talk about specifics. |
17 | QUESTION: Potentially, had this gone into |
18 | litigation, what could we have seen perhaps in terms of time |
19 | and cost? |
20 | MS. BINGAMAN: Had this been litigated, we hoped |
21 | to conclude it within a year. We planned to file it in a |
22 | district in which the dockets are not crowded and we could |
23 | have obtained a quick resolution, because the markets need |
24 | to be open. This needed to get done. But it would have |
25 | been a minimum of a year at the very best. It undoubtedly |
1 | would have been appealed. And the key point is, after all |
2 | that, two to two-and-a-half years at best through appeal, |
3 | we could not have achieved one thing more than we got in |
4 | this settlement. |
5 | And, frankly, I am not sure we would have gotten |
6 | as much. I do not know, because I do not know what a judge |
7 | would have done. But this settlement is 100 percent of what |
8 | we would have gotten with a lawsuit. |
9 | QUESTION: Can you tell us more about the EC |
10 | cooperation, how and when was that initiated? And wasn't |
11 | there a British investigation as well? |
12 | MS. BINGAMAN: No, there was no British |
13 | investigation. It was the European Commission. It was a |
14 | result, actually -- last September, I went to Europe for |
15 | consultations, which are annual consultations with the EC |
16 | that we have done for years, the Antitrust Division -- it's |
17 | a mutual cooperative thing -- and Klaus Ailerman, the head |
18 | of the Competition Directorate said to me, What are you |
19 | doing about Microsoft, because we have a Microsoft case, |
20 | too, you know, and I am very interested to talk to you about |
21 | it? |
22 | And I looked at him and I said, Klaus, I do not |
23 | think I can say a word to you about Microsoft. Everything |
24 | I know is under confidential documents. I am forbidden from |
25 | talking about it. I can't speak to you. |
1 | And he said, Well, what a great pity, because |
2 | we've got, as far as I can tell from press reports, the same |
3 | case. |
4 | And I said, Well, it is a great pity. |
5 | And I came back to the United States -- that was |
6 | the end of September -- and 10 days or two weeks later, it |
7 | just hit me out of the blue one day, we should ask Microsoft |
8 | to waive confidentiality so that we could cooperate and |
9 | decide whether in fact there is a case and coordinate |
10 | remedies. |
11 | And the coordination of remedies is really crucial |
12 | for a company in Microsoft's position, which operates |
13 | worldwide, literally, in -- I do not know -- tens of |
14 | countries in the world. They need, for their own business |
15 | reasons, to have the same contracting practices. It would |
16 | be terribly disruptive -- and I called the EC. We asked |
17 | Microsoft. Microsoft, for its own reasons, said that would |
18 | actually -- they didn't have a problem. They waived |
19 | confidentiality. And that is how it began last October, and |
20 | it has continued since then. |
21 | QUESTION: How is the Justice Department going to |
22 | monitor the new agreements, the new contracts that Microsoft |
23 | will sign with its OEM's? And what guarantees are there |
24 | that Microsoft isn't going to turn around and say, you know, |
25 | if we cannot do the kinds of volume deals that we have done |
1 | in the past, we are going to charge 5, 10, 15 percent for |
2 | the operating system than we have in the past? |
3 | MS. BINGAMAN: If they charge more for their |
4 | operating system, the competitors are there, without |
5 | question, with comparable products. And the market should |
6 | take care of that. That is the whole idea of this |
7 | settlement. The market should take care of it. |
8 | We are allowed, in the monitoring provisions of |
9 | this decree, which you should have, to request documents |
10 | from Microsoft, to inspect their contracts, to talk to their |
11 | people. We are further -- the decree specifically provides |
12 | we can cooperate with the EC in this monitoring, so we will |
13 | continue our cooperation and close work with them. |
14 | And we are watching. We are very much on the |
15 | case. |
16 | QUESTION: A question about the per-processor |
17 | issue. From your presentation it wasn't entirely clear to |
18 | me, but it sounds as though Microsoft main pressure on |
19 | computer companies was that they got -- they would offer |
20 | huge, huge discounts to the companies that would accept a |
21 | per-processor kind of agreement. That being the case, it |
22 | seems to me that, on one level, the sin is that Microsoft |
23 | is simply charging too little for the operating system. |
24 | And, to follow up on that, to follow up on that, |
25 | it seems to me that the marketplace situation may not be a |
1 | whole lot different, because Microsoft can continue, it |
2 | seems to me, to charge that same low, low price. |
3 | MS. BINGAMAN: Ed, you been talking to Microsoft? |
4 | That is their line. They are not telling you right. If |
5 | that was so easy, why did they have per-processor licenses? |
6 | They are the only company in the industry that did. Why did |
7 | they have three- to five-year contracts? They are the only |
8 | company that in the industry that did. Why did they have |
9 | 100 percent minimum commitments? They are the only company |
10 | in the industry that enforced that. |
11 | If this was so simple, why were they locking up |
12 | the market with practices which every computer manufacturer |
13 | despised and which the competitors despised and which |
14 | Microsoft hung tough through four years of Government |
15 | investigation to hang on to? Do you think that is because |
16 | it did not matter to them? That is the story they are |
17 | putting out. |
18 | You are darned right they are trying to spin it |
19 | their way. That is not right. And let me tell you. Volume |
20 | discounts, of course they can volume discount. No question. |
21 | There is nothing wrong with volume discounting. It is done |
22 | in all kinds of industries, in all kinds of situations. And |
23 | the decree does not address volume discounts as such. |
24 | The problem with Microsoft's practices is that |
25 | they were using volume discounts to lock up the market with |
1 | per-processor contracts and 100 percent minimum commitments, |
2 | which then were like iron. You could not get out of. You |
3 | could not escape. |
4 | To get those low prices, you had to sell your soul |
5 | and never leave Microsoft. And that is what this decree |
6 | changes. |
7 | Microsoft can compete on the basis of low price. |
8 | We have no problem with that. That is good. We want that. |
9 | What we do not want is competing on the basis of low price |
10 | and then using that to impose contract terms which exclude |
11 | every other competitor. |
12 | And, Ed, the reason they were able to do that is |
13 | because of their monopoly position in this market. I mean, |
14 | this is an important question you are asking, because they |
15 | are going to try to claim that this decree changes nothing. |
16 | That is wrong. That is a lie. And people need to |
17 | understand that. |
18 | Because volume discounting, in and of itself, is |
19 | not a problem. There are ways volume discounting can be |
20 | abused. I have discussed those ways with Microsoft and Bill |
21 | Gates. We are watching. We are watching closely what they |
22 | do with volume discounts. They know it. I know it. And |
23 | we are going to see what happens here. |
24 | But volume discounting, in and of itself, is not |
25 | a problem. There can be problems in how you structure them, |
1 | whether you force -- it's a technical discussion. But, in |
2 | any event, believe me, they did not hang tough on this for |
3 | so long, right to the brink of a joint lawsuit by the U.S. |
4 | and the EC yesterday because these practices were so |
5 | harmless and meaningless and so forth. But I can see why |
6 | they say it. |
7 | (Laughter.) |
8 | QUESTION: Is there going to be an immediate |
9 | effect that we will notice for consumers? |
10 | MS. BINGAMAN: I hope consumers, within a short |
11 | period of time, will have more choice of operating systems, |
12 | genuine choice, more innovation in computers. Certainly, |
13 | the prices will lower for consumers who already buy |
14 | competing operating systems. Any of these companies in the |
15 | market right now can now sell just for their price, not for |
16 | this double tax that Microsoft has gotten. |
17 | So, I think prices will immediately lower, and I |
18 | think, over the medium to long range, this will, I hope and |
19 | believe, have profound market opening impacts. It will help |
20 | innovation, help the competition give us better products. |
21 | You may be using a different operating system three years |
22 | from now because of this -- maybe. And if you are, great. |
23 | If you still want whatever, great. |
24 | But the point is you should have a choice. |
25 | Everyone should have a choice. And the companies that |
1 | compete with Microsoft should be able to offer you that |
2 | choice fairly and evenly. |
3 | VOICE: Thank you. |
4 | QUESTION: Microsoft's competitors in applications |
5 | have complained about the access that they have had to all |
6 | kinds of information about the operating system code. Did |
7 | the Justice Department not find that Microsoft had unfairly |
8 | restricted applications developers to various aspects of the |
9 | software? |
10 | MS. BINGAMAN: The nondisclosure agreement, the |
11 | so-called NDA part of the case, focused on nondisclosure |
12 | agreements required -- are you talking about something else? |
13 | QUESTION: I mean, certainly the NDA has been part |
14 | of it, but other companies -- |
15 | MS. BINGAMAN: The so-called interoperability? |
16 | QUESTION: Yes, yes, hidden calls and all of the |
17 | charges that have been raised over the past few -- |
18 | MS. BINGAMAN: I can tell you we have looked |
19 | closely at all aspects of this case. We have examined it |
20 | closely. And I think all that I can say, because of the |
21 | strictures of confidentiality and the law, is that we have |
22 | looked at it and this is the case we chose to bring because |
23 | this is the case that is there and needed to be brought. |
24 | And I think that is all I should say. |
25 | VOICE: Okay. Thank you. |
1 | VOICE: Thank you. |
2 | MS. BINGAMAN: Okay. Thank you. |
3 | VOICE: Thank you very much. |
4 | (End of proceedings.) |
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