Microsoft and its trade association in spat

[Roger Marquis <marquis@roble.com>]

      Microsoft and its trade association in spat
      By David Lawsky

WASHINGTON, Feb 3 (Reuters) - Microsoft Corp. and its trade association
got into a nasty spat Tuesday over the role of antitrust law in
preserving competition in the high-tech industry.

The 1,200-member Software Publishers Association unveiled a list of
principles, declaring that the nation's 100-year-old antitrust laws
have an important role to play in making sure that no competitor goes
too far in promoting its own computer code.

Microsoft immediately denounced the Software Publishers Association, to
which it pays $100,000 dues annually, for a ``charade'' and charged the
association had been ``co-opted by a few competitors who want to use
the government as a weapon against Microsoft.''

Microsoft is in a struggle with the Justice Department over charges it
violated a 1995 consent decree aimed at increasing competition in the
software industry.

Microsoft won a significant preliminary victory late Monday when the
U.S. Court of Appeals for the District of Columbia Circuit stopped
Harvard law professor Lawrence Lessig from advising a federal judge in
the case.

The Software Publishers Association says its principles are meant to
apply not merely to Microsoft, but to anyone in the software industry.

``When it comes to the computer software industry, the Sherman
(antitrust) Act isn't dead,'' Ken Wasch, president of the association,
said.

The industry's first principle: ``The overriding objective of
competition policy as applied to our industry should be to maximize
innovation and dynamic competition for the benefit of consumers.''

Microsoft says its fight with the Justice Department is also about
principles.

``We believe that the Department of Justice case is about a fundamental
principle and that's that every software company, including Microsoft,
must have the ability to constantly improve its products,'' Microsoft
spokesman Mark Murray said.

He said if companies may not improve their products, ``consumers will
suffer and the future of the U.S.  software industry will be
undermined.''

The trade association principles mention no individual company but many
of the practices it criticizes match alleged behavior for which
opponents have criticized Microsoft.

For example, principle three is that the ``owner of a dominant
operating system'' should not design the software ``desktop.'' That
decision, the group says, should be left to computer makers.

Microsoft insists that computers using its software should have the
same look.

The software trade group also said operators of a ``dominant operating
system'' should not use its power to leverage the sale of its other
products. The Justice Department has accused Microsoft of doing exactly
that.

Microsoft's Murray said the committee which drew up the principles
included many ``Microsoft bashers,'' such as network software maker
Novell Inc.(NOVL - news), Internet browser archrival Netscape
Communications Corp. (NSCP - news) and database software company Oracle
Corp.(ORCL - news)

Wasch said Microsoft had been heard from as well.

The trade association's other principles include nondiscriminatory
licensing to third-party developers, competitive licensing of software
applications to computer makers and equal access to retail customers on
store shelves -- as ways to preserve competition.

Copyright © 1998 Reuters Limited.