Microsoft has suffered a legal setback by a US District Court ruling in favour of the Department of Justice (DoJ), stating MS must cease and desist from bundling Internet Explorer 4 (IE) with Windows 95.
District Court judge Thomas Jackson gave a preliminary ruling on 11 December, stating that the software giant could not force its OEM partners to take its browser as part of the terms of the licensing agreement for Windows 95 or any subsequent browser.
PC vendor Compaq gave evidence earlier in the year stating it had wanted to load Netscape Navigator on certain desktop models. Compaq claimed MS had written it a letter stating that unless it installed IE, MS would revoke its licence for Windows 95. At that point, Compaq gave in to MS' bidding. Gateway 2000 and Micron were also denied permission to remove IE and its icon from their systems. None of the vendors were available for comment on the temporary ruling.
The ban is to remain in effect until other issues surrounding an anti-trust case brought about by the DoJ against MS are further reviewed by the court. The ruling also deemed that MS was not in contempt for violating the 1995 consent decree established to engender fair competition in the software industry.
MS signed the consent decree with the DoJ, in which it agreed 'to end its illegal, monopolistic practices' in 'unfair contracts with PC manufacturers' that 'choked off competition and preserved its monopoly position'. The DoJ had requested that the court hold MS in contempt and fine the vendor $1 million a day for every day the decree remained violated.
In response to the ruling, MS issued a statement on 12 December saying it was 'gratified that Judge Jackson denied the DoJ petition for an order holding the company in contempt of court for allegedly violating the decree'.
Despite MS' apparent delight at the ruling, industry insiders believe it has suffered a blow, particularly with regard to its plans to release Windows 98 by March next year.
It is believed that delays - a result of having to rework the operating system - will be unavoidable.
Keith Warbuton, executive director of the Personal Computer Association (PCA), a campaigner against anti-competitive practises in the UK, said he hoped the ruling would cause MS to re-examine how it operates with its channel.
'I hope MS realises that the channel, not the user, is the customer. You can only abuse your channel when yours is the only ball game in town,' he said.
Steve Voller, UK managing director of arch-rival Netscape, quipped: 'It's a great Christmas present for Netscape.'
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