Judge: Microsoft Antitrust Pact No Guarantee

The federal judge overseeing the landmark Microsoft Corp. (MSFT) antitrust settlement said Wednesday there was no guarantee the pact will put a dent in the company's Windows computer operating system monopoly.

U.S. District Court Judge Colleen Kollar-Kotelly (search) said during a court hearing that it was not her job to ensure the settlement gives rise to new competition, only to make sure Microsoft sticks to the agreement it made with the government.

Whether the settlement actually leads to more competition with Microsoft "is an issue that the court does not control," said Kollar-Kotelly, who endorsed the settlement in November 2002.

Many Microsoft critics had opposed the consent decree on the grounds that it would do little to erode the company's dominant position in the software business.

"I don't see any reason to change our mind about that," said one such critic, American Antitrust Institute (search) president Bert Foer. "The failure to see changes presumably is evidence of a failure of the remedy."

Kollar-Kotelly's comments came during a conference with lawyers for the Justice Department (search) and Microsoft, to review how well the company is complying with the settlement.

The pact is designed to give computer makers greater freedom to feature rival software on their machines by allowing them to hide some Microsoft icons on the Windows desktop, and by forcing the company to disclose more to competitors about the internal workings of the operating system.

During Wednesday's conference, the Justice Department told Kollar-Kotelly it was happy with recent steps Microsoft had taken to comply with the settlement, in particular the progress made in giving potential rivals access to key Windows code.

However, in response to a question from the judge, antitrust division official Renata Hesse said none of the companies who have licensed the code were a significant challenge to Microsoft's dominant operating system position.

"Microsoft continues to have a large share of that market," Hesse said.

Microsoft lawyer Rick Rule told Kollar-Kotelly that it was not the goal of the settlement to "hinder" Microsoft or necessarily take a bite out of the company's market share. Rather, he said, its job was to remove barriers to competition.

"Measured by that yardstick, I think the decree has been a success," Rule told Kollar-Kotelly.

Kollar-Kotelly agreed, saying her job was to ensure compliance with the deal, not determine the outcome in the marketplace.

Hesse said after the conference that Justice Department officials wanted to see "a marketplace functioning in a healthy way."