User:Thembateam

ASSIGNMENT for Business Environment
SUBMISSION TO THE SCHOOL OFFICE TUESDAY OF WEEK 11 BY 3PM

1.0 Introduction

2.0 Company Overview

3.0 Legal Environment

Microsoft’s success has seen it become the focus of many legal challenges. The Windows operating system in its various forms is reported to be installed on over 90% of the world’s pc’s. (Information Week, 10th April 2006). This has allowed Microsoft to bring to the market other software products as part of or closely linked to the core operating system. This monopoly situation has resulted in various antitrust cases being brought against them by various government bodies around the world.

3.0.1 Summary of United Stated v Microsoft

This case was filed on 18th May 1998 and it was not until 30th June 2004 that the Department of Justice (DOJ) settlement was approved in a judgement from the courts. This case involved 20 states alleging that Microsoft were guilty of abusing its Monopoly power over other competing technologies. At the core of this case was the browser war between the Microsoft Internet Explorer browser and Netscape’s Navigator product.

Two main allegations were placed against Microsoft, firstly that they were abusing their monopoly power by bundling the browser with the operating system and secondly that they were unfairly restricting the market for competing products as they had to be downloaded which was slow and also that their application programming interfaces favoured their own Microsoft product.

The outcome of the initial case held in favour of the DOJ with the judge reporting that Microsoft had abused its power against other companies and technologies such as Apple, Java, Netscape, Lotus Notes, Real Networks, and Linux. The judge ordered that Microsoft be split into two companies one to produce the operating system and the other to produce other software products.

This decision was appealed and heard by the federal appeals court, which overturned the earlier decision. They did affirm in part the earlier judgement of monopolisation however on 6th September 2001 stated that they would not seek to split Microsoft but would pursue a lesser antitrust penalty.

The settlement finally approved on 30th June 2004 involved Microsoft sharing the Application Programming Interfaces with third party companies and appointing a panel that would have access to Microsoft’s records and source etc. for 5 years to ensure compliance.

3.0.2 Other Antitrust Cases

With Microsoft’s hold on the market other companies have taken cases against Microsoft and made similar allegations as in the case outlined above.

On 23rd January 2002 AOL Time Warner Inc. took a case against Microsoft for actions against Netscape (which AOL had acquired) and settled for $750 million on 29th May 2003.

On 8th March 2002 Sun Microsystems Inc filed an antitrust case against Microsoft, alleging extensive anticompetitive practices. This case involved the use of Java technologies. Sun later settled on 2nd April 2004 in exchange for a $1.6 billion payment from Microsoft.

With the increased use of audio and video, Real Networks on 18th December 2003 filed a case against Microsoft again accusing it of illegally using its monopoly position in this field. 11th October 2005 seen the companies settle the dispute in a deal worth $761 million to Real Networks Inc.

3.0.3 European Commission case

3.0.4 Asian Case

3.0.5 Intellectual Property Rights and Piracy

3.0.6 Employment Law / Contracts / Codes of Conduct

4.0 Threats

5.0 Opportunities

6.0 Conclusion