Microsoft drafts proposal

September 10, 2001 Posted: 1127 GMT

NEW YORK (CNNfn) -- Microsoft Corp. is preparing a proposal to settle the antitrust case against it and blunt the U.S. government's attempt to restrict the company's business operations, according to a published report Monday.

After abandoning its attempt to break up the world's largest software company last week, the government intends to seek regulations aimed at allowing computer makers to choose competing software programs instead of accepting what Microsoft gives in its Windows operating system, according to The Wall Street Journal.

Under the government's proposals, some of the non-Microsoft products that box makers will be able to choose from include multi-media plug-ins and instant messaging services.

Although it is drafting a settlement proposal, Redmond, Wash.-based Microsoft (MSFT: Research, Estimates)  is not expected to lie down for the government. Steve Ballmer, the company's chief executive, said regulatory rules will be "just as damaging" to the company's business as a breakup, according to the Journal.

Details of Microsoft's current proposal to the government were not disclosed. But the company offered a settlement two years ago, which included the end of a number of contract provisions, technical operating information, and the opening up of Windows initial screen, the paper reported.

In addition, the company still faces antitrust concerns from the European Union and private corporate suits from the likes of Sun Microsystems and AOL Time Warner, the parent company of CNNfn. According to the Journal, AOL executives said the appeals court ruling upholding the government's original claims against Microsoft give it useful precedence. And Sun's general counsel, Mike Morris, told the paper "we'd be remiss in our fiduciary responsibility if we didn't take a hard look at a private antitrust action." 

Microsoft shares fell 62 cents to $55.40 Friday.

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