Steve Jobs, CEO of Apple Computer, yesterday proposed that Microsoft should give $1 billion in cash to help schools, instead of the current proposal which would involve a gift of software and hardware to a value of approximately the same figure.

Jobs said the Microsoft proposal would give Bill Gates’ company a competitive edge to provide these schools with future products and services by creating a dependency on Microsoft technology. Apple still controls a major section of the educational market and fears that this would be lost to its rival if the Microsoft proposal is accepted.

Steve Jobs said:

"The centrepiece of Microsoft's proposed $1 billion civil antitrust settlement is their donation of Microsoft software, which they value at $830 million, to our schools. We think people should know that the actual costs to Microsoft for this donated software will likely be under $1 million. We think a far better settlement is for Microsoft to give their proposed $1 billion to an independent foundation, which will provide our most needy schools with the computer technology of their choice."

Meanwhile, the nine US states seeking further action against Microsoft in the main antitrust case will today propose new behavioural restraints on the company. The details of the proposal are not yet known, but they are thought to include a demand for public access to significant parts of the Windows source code, which would benefit rivals such as Apple and Sun.

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