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The Department of Justice for years has been battling Microsoft in court seeking to remedy perceived antitrust violations and monopoly power. It is not clear, however, whether these efforts have made a sizable dent in Microsoft’s omnipotence. Now, along comes Ralph Nader with a new suggestion — fighting Microsoft in its government procurement wallet. According to Nader, the U.S. could have a greater impact if it simply used its own massive purchasing power with respect to Microsoft’s products to lessen Microsoft’s dominance in the area of computer operating systems and office-productivity software. Nader is talking, but should anyone listen? A DIFFERENT CALL FOR ACTION In a letter dated June 4 to Mitchell Daniels Jr., the Director of the Office of Management and Budget, Nader, along with James Love, of the Consumer Project on Technology, assert that while “the Department of Justice is spending years in court trying to restrain very modest elements of Microsoft’s monopoly abuses,” Microsoft still “has an astounding market share for desktop operating systems and office productivity software.” Nader and Love complain that there are “serious problems with the Microsoft monopoly, including those associated with harm to innovation, security and pricing.” Nader and Love further state that the federal government “spends billions of dollars on software purchases from one company [Microsoft] that is continually raising prices, making its products incompatible with previous versions in order to force upgrades, deliberately creating interoperability problems with would-be competitors, and [engages] in many other anticompetitive practices.” They suggest that a private business in the U.S. government’s shoes would not be a “passive consumer” as apparently is the government up to this point. Having indicted Microsoft for its anticompetitive behavior and the U.S. government for its passive consuming acceptance of Microsoft’s products, Nader and Love then make specific proposals for government consideration. THE PROPOSALS With tremendous purchasing power on its side, Nader and Love recommend that the U.S. government consider the following suggested requirements as part of the procurement process with Microsoft: � Disclosure of the file formats of Microsoft’s office productivity and multimedia programs such that the data created in these programs could be read reliably by non-Microsoft software; � Creation of a cost-benefit analysis to ascertain whether a dominant software provider such as Microsoft should make public their source code to enhance interoperability with products offered by less dominant competitors [Nader and Love assert that limits on market shares are "feasible" because "Apple has a very good PC operating system, and both Corel and IBM have quite functional products for word processing and other office productivity tools, that suffer primarily because of interoperability issues with Microsoft's products"]; � Imposition of a “lower cap” on Microsoft’s market share if it is determined that Microsoft is “sabotaging rival products or refusing to disclose interface information to rival software makers”; � Requirement of “high quality ports” to other operating systems such as Linux or BeOS to help achieve a “sliding scale for permitted market share, depending on the number of operating systems the product would support”; and � Analysis of the comparative benefits of licensing office productivity tools from Microsoft as opposed to buying the code outright and releasing it into the public domain. SHOULD ANYONE LISTEN? The June 4 letter of Nader and Love begins with a reference to a prior April 8 meeting with the Office of Management and Budget, and the letter concludes by requesting a further meeting to discuss “uses of federal procurement policy to reduce waste and promote competition.” Perhaps Nader and Love do have an audience with the government. Or, maybe the government simply is indulging them briefly with a bit of time, while turning a deaf ear. Government procurement issues can be very complicated, and whether the battleship of the government can turn on a dime specifically to address Microsoft is unclear. However, it is true that so far, the many years of U.S. antitrust litigation against Microsoft have not yet yielded remarkable change in the computer operating systems and office productivity marketplace. Thus, creative ideas should be encouraged. Whether these are the creative ideas that carry the day is another matter. But so long as we have an active marketplace for ideas, solutions hopefully will follow. Eric Sinrod is a partner in the San Francisco office of the international law firm Duane Morris LLP, www.duanemorris.com, where he focuses on technology and litigation matters. He can be reached at [email protected], and his Web site is http://www.sinrodlaw.com.

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