Out-Law / Your Daily Need-To-Know

Microsoft has settled over 100 class action lawsuits which were brought by individuals who claimed that the company abused its market dominance to over-charge for its products. Instead of each consumer taking a small sum in compensation - which would likely have been consumed by legal fees - the company has pledged to provide software and computers to the poorest schools in the US, an offer valued at around $1 billion over a five year period.

Microsoft is to file the settlement agreement for approval by a US court. If its terms are implemented, the company will assist around 12,500 schools and nearly 7 million children in the US with a mixture of software, training and subsidised hardware.

“It is a settlement that avoids long and costly litigation for the company, and at the same time will really make a difference in the lives of millions of schoolchildren,” said Steve Ballmer, Microsoft’s CEO.

The agreement has already met with criticism, however. Some have described the deal as a PR stunt to enhance Microsoft’s tarnished reputation and also as a covert attempt to gain a greater share of the market for educational software in the US which has traditionally been dominated by Apple.

In its defence, Microsoft points out that the money can be used to buy any kind of software, not just Microsoft’s and that, had Microsoft lost the class action, each individual would have been awarded only a few dollars apiece.

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