May 1, 1997 8:30 AM PDT

IBM freed of antitrust regulation

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40-year-old IBM antitrust case ends

July 2, 1996
The Justice Department officially ended a 40-year-old antitrust regulation of IBM (IBM) yesterday.

The federal government already had discarded portions of the antitrust consent decree, but maintained regulation of the mini-computer and mainframe markets. The Justice Department yesterday lifted those restrictions in a phase-out plan that will extend over five years.

The antitrust consent decree against IBM has existed since 1956; it was originally intended to prevent the computing monolith from monopolizing the market for punch-card tabulating and electronic data-processing machines. The consent decree ended last year for the PC and workstation portions of IBM's business. The latest move covers the remaining elements of IBM's business: AS/400 mini-computers and System 390 mainframes.

Lawyers for Independent Service Network International, an association of computer maintainers who opposed ending the decree, said they would recommend that their members appeal the decision.

ISNI lawyers contend that IBM, which controls 80 percent of the mainframe market, should still be regulated. Despite years of predictions that mainframes will gradually disappear, mainframe sales are actually surging. ISNI contends that more dollars are being spent on mainframes than ever before.


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