Page C8 New Haven Register, Tuesday, January 11, 20Q0
Caldera, Microsoft OK terms of antitrust suit settlement
SALT LAKE CITY Computer software maker Caldera has settled an antitrust suit against Microsoft for an undisclosed sum, the companies announced Monday.
In a statement, Microsoft said the settlement would reduce its quarterly earnings ended March 31, 2000 by 3 cents per share.
Based on the 5.15 billion shares the Redmond, Wash.-based company has outstanding, that would be equivalent to about $155 million. A Microsoft spokesman would not confirm the figure.
But settling could cost Microsoft far more than money, said Dan Kusnetzky, program director for operating environments and serverware for International Data Corp.
"It looks bad for them from the standpoint of PR," Kusnetzky said Monday. "Most of what Microsoft sells is a grand vision, and they sell it to noninformation technology people. And the grand vision looks more and more sour if Microsoft is not invincible."
Spinning the settlement will also distract Microsoft from its long overdue launch of Windows 2000, scheduled for Feb. 17, Kusnetzky said. Caldera, based in Orem, Utah, accused Microsoft of anti competitive practices that allegedly torpedoed an operating system called DR DOS more than a decade ago. A jury trial was expected to begin Feb. 1 and take up to four months.
DR DOS was developed by Novell, which later sold it to Caldera. It worked much like MSDOS, the platform that Microsoft used to build its Windows empire.
Caldera claims Microsoft used its heft to kill the DR DOS operating system in favor of MSDOS. Whatever the cause, MSDOS arid Windows gained strength; Windows now runs 90 percent of all personal computers.
Among Caldera's allegations were charges that Microsoft included an error message in its Windows 3.1 operating system whenever it detected DR DOS on a computer. Caldera says the message was not needed and needlessly scared users away from its product.
Caldera asserted that beginning in May 1990, Microsoft either built incompatibilities into the Windows program or. tried to, create a perception of incompatibilities to discourage computer users from buying DR DOS - even while emails compiled as evidence indicate Microsoft programmers found DR DOS superior. For the most part, Caldera argued, the tactics worked, wreaking damages unofficially estimated at $1.6 billion.
Caldera's attorneys had planned to argue that with a level playing field; the company might have held on to the 15 percent to 20 percent market share it held when the personal computer market exploded early in the decade.