Government wants Microsoft broken into three parts

Posted: Wednesday, January 12, 2000

WASHINGTON (AP) - Government lawyers studying ways to limit Microsoft's expansive influence in the technology industry want to break the software giant into three parts, arguing that lesser remedies in the antitrust trial would be inadequate, people close to these discussions confirmed today.

If U.S. District Thomas Penfield Jackson were to agree to such a dramatic solution, such a breakup of Bill Gates' software empire would carry enormous implications for the way consumers buy and use programs for their computers.

Justice Department lawyers laid out their favored proposal to break Microsoft into three parts during a secret meeting last week in Washington with representatives of the 19 states also suing the company over alleged antitrust violations, according to people close to the case who spoke on condition of anonymity.

The Justice Department, which last month disclosed it had hired as its adviser a financial consulting firm, Greenhill & Co. LLC of New York, argued that any lesser sanctions - such as prohibiting the company from abusing its influence - would be inadequate to rein in Microsoft's aggressive behavior.

Attorneys general for the 19 states are deciding among themselves whether to endorse the Justice proposal but are said to be leaning in favor of it, and the plan could be presented next week when government lawyers meet privately in Chicago with the federal mediator assigned to the case, according to people close to the case.

USA Today reported in today that the government favored breaking Microsoft into two parts, not three. The Justice Department, in a statement, said the story was ``inaccurate in several important respects, and it does not adequately represent our views.''

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