March 24, 2004 5:11 PM PST

Monitoring the monitors

The European Commission's plan to appoint a "monitoring trustee" to ensure that Microsoft complies with its sweeping antitrust ruling drew a skeptical response on Wednesday from attorneys familiar with similar oversight attempts in the United States.

EC regulators have demanded that Microsoft disclose closely held software code to competitors and ordered the company to make available a version of its Windows operating system sans its Windows Media Player product.

In order to help enforce that decision, the commission said in a statement that it will name a trustee responsible for ensuring that "Microsoft's interface disclosures are complete and accurate and that the two versions of Windows are equivalent in terms of performance."

The agency has yet to name anyone to fill the office, and it has provided few details about the scope of its authority or enforcement mechanisms. Still, antitrust experts said whoever takes on the job faces a daunting task, assuming that the decision survives a legal appeal.

"A lot will depend on how it's structured, but I'm somewhat skeptical about how effective the monitor could be," said Dan Rubinfeld, an economics professor at the University of California at Berkeley, who served in the U.S. Department of Justice's antitrust division during its own pursuit of Microsoft. "In general, it's a very difficult job...When you're not there on a regular basis, it's hard to monitor this stuff."

Attorneys said compliance monitors have traditionally been used only rarely in antitrust cases but that they have become more common since Microsoft agreed to install an independent oversight board as part of its 2002 settlement with the Justice Department. That board includes a technical committee responsible for reviewing disclosures of Microsoft's source code under licensing terms sketched out as part of the deal.

The committee reports every three months to the Justice Department, as well as to attorneys general from states that signed on to the accord.

In the latest report, issued in January, the oversight board said it is working to resolve six "substantive" complaints over licensing terms set out in the Microsoft Communications Protocol Program (MCPP). In addition, the committee said it is investigating a complaint from an unnamed company that Microsoft has not done enough to ensure that rivals have the information they need to design products that work well with Windows.

Another concern expressed in the report is that there is scant evidence to show that the settlement has led to greater competition in the software market. At the time of the report, just 11 companies had purchased MCPP licenses.

"The MCPP licenses may simply represent a continuation of both the status quo and the business choices Microsoft made before the finding of liability and the imposition of a remedy," the committee wrote.

Lee Patch, a vice president of legal affairs at Sun Microsystems, said the Microsoft rival has held discussions with the compliance committee, but he declined to discuss specific details. Patch said he believes the board is competent and receptive to complaints that come to it. But he said the group has no enforcement powers and thus has made little impact to date.

"It's been more than two years of horribly inadequate conformance and compliance," he said. "The board members are very technically capable...and comprehend the importance of technical matters and deficiencies in disclosure that Microsoft has been making. But one fundamental flaw is that they are powerless under the framework set up by the DOJ."

Microsoft spokesman Jim Desler said the numerous complaints under review by the compliance board may or may not be valid but that they clearly show that Microsoft faces substantial scrutiny over its conformity with the Justice Department settlement.

"The thoroughness of the oversight is evidenced by the compliance reports that have taken place every three months since the decree was put into effect," he said. "The technical committee has been given unprecedented access to Microsoft's software code."

Oversight history
The concept of using independent experts to oversee Microsoft's compliance with antitrust laws is not exactly new.

In late 1997, U.S. District Judge Thomas Penfield Jackson appointed a so-called special master to collect and weigh evidence, after the Justice Department accused Microsoft of violating an earlier settlement agreement. Special masters are granted quasijudicial powers to gather testimony and can hold parties in contempt of court, and Jackson had made a preliminary ruling that Microsoft had run afoul of the settlement.

To help him sort out what to do next, Jackson turned to Larry Lessig, a professor of law at Harvard University at the time. But after unearthing Lessig's e-mail conversations with a Netscape attorney that apparently likened Microsoft to Satan, the software company said it had good evidence that he should be disqualified as unduly biased. Lessig's own affidavit denied the allegation, saying "I do not have any personal bias or prejudice" against Microsoft.

A few months later, a federal appeals court gave Lessig the boot, ending Microsoft's first oversight by an independent, court-appointed expert in the United States.

Legal experts agreed that it is too soon to judge how effective a European trustee might be, given that details have not yet been made public about the scope of this official's powers.



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Some attorneys said Europe may have greater success in controlling Microsoft's behavior than the United States, thanks to the harsher remedies imposed.

"There are important differences between the U.S. and EU cases," said Spencer Waller, a professor at Loyola University Chicago School of Law. "In the U.S., many people were concerned not so much about the effectiveness of the monitor but the leniency of the settlement. I'm not sure that's a problem in Europe."

Microsoft rival RealNetworks agreed, saying the EU order appears to offer greater enforcement opportunities than the U.S. settlement.

"The fundamental problem with the compliance board in (the) U.S. is that it was set up to enforce toothless remedies," RealNetworks General Counsel Bob Kimball said. "We still need to see the full decision, but they seem to have created a simple and straightforward order, compared to the complex loophole-ridden settlement approved in the U.S. That should make it enforceable."

Even so, Loyola's Waller said monitors appear to offer a weak solution at best to the difficult problem antitrust enforcers face in attempting to control the market effects of software engineering.

"It makes me uncomfortable, but I'm not sure what else they can do," Waller said. "The EC lawyers aren't technical experts, and they can't want to be in charge of day-to-day monitoring of Microsoft's technical compliance with the decision. That said, it's been a very unsatisfactory situation in the United States."

CNET News.com's Declan McCullagh contributed to this report.

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Instead, why not educate the user?
I'm at a bit of a loss to what the big problem is with Microsoft including MEdia Player in windows. If I recall correctly, nobody complained about their standard CD-player software. And while you might not always uninstall Media Player, installing a substitute is easy, and there are tons of free options available.

Not to mention that both Real and Quicktime have their own monopolies going. Is anyone going to fine them for not releasing their codecs on the market? Right now Media Player is far more helpful in playing a variety of media files, but the other two simply cause clutter, since they exist purely to play file types I occasionally need to look at.

Instead of suing the corporate entities all of this time, shouldn't we instead focus on educating end users? For one, it would also help stem the tide of worms that flood the internet, mostly thanks to end-user ignorance.
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Wasted Time!!
If this much time and effort was spent on DeBeer's, diamonds would be worth their true value. Carbon crystals at pennies per kilogram.
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