Justice Department concerns over Microsoft antitrust deal

The states that signed the report include nine that joined the Justice Department in reaching the deal with Microsoft and nine states that appealed for tougher penalties but lost.

The focus of concern is Microsoft's Communications Protocol Licensing Program (MCPP). The report states:

"Plaintiffs have identified numerous concerns with the MCPP generally and with certain license terms and requirements specifically and have raised these concerns with Microsoft over the past several months."

It acknowledges that Microsoft "has made many significant changes to the MCPP." These include removing a requirement for a potential licensee to sign a confidentiality agreement to review the license terms, easing the MCPP's entry criteria and modifying a license term that could have deterred prospective licensees who choose to work with the open source community.

However, the report notes continuing concern about the royalty structure and rates proposed by Microsoft. The company had undertaken to licence certain Communications Protocols on reasonable and non-discriminatory - or RAND – terms, and to do so by February 2002.

Implementation of RAND terms was intended by the Court to be the "most forward-looking provision in the Court's remedy" and directed toward "unfettering the market and restoring competition." The Justice Department reports that "further steps may need to be taken, either pursuant to agreement or order of the Court, to account for Microsoft's delayed implementation."

The states and the Justice Department are continuing to negotiate with Microsoft and taking industry feedback to improve the MCPP's terms and will report back to the court on 24th July.

The report is available at:
www.usdoj.gov/atr/cases/f201100/201135.htm