The chairman of computer software giant Microsoft, Bill Gates, has rejected a proposal by the United States government to break the company up, as a punishment for unfair competition, reported BBC.online Saturday.
Gates was speaking after the Justice Department submitted its proposal to the judge who had found Microsoft guilty of breaking anti-monopoly laws.
The government says Microsoft should be split into two separate companies - one for Microsoft's Windows operating system, and another for its software applications.
Gates said consumers would suffer from these proposals because they wouldn't allow Microsoft to offer new software in the future.
In a recorded statement, he said: "These proposals would have a chilling effect on innovation in the high technology industry.
"Microsoft could never have developed Windows under these rules."
Assistant Attorney General Joel Klein countered: "Under our proposals, neither the heavy hand of ongoing government regulation nor the self-interest of an entrenched monopolist will decide what is best for consumers.
"Rather, consumers will be able to choose for themselves the products they want in a free and competitive marketplace."
Under the government proposals, one of the new companies would sell the various Windows operating systems and the other would do everything else, such as produce software applications and the Internet Explorer browser.
The operating systems business would have to develop its own browser to compete with Internet Explorer.
The companies would be barred from colluding or from distributing each other's products, and could not reunite for 10 years.
A number of conduct restrictions would take immediate effect.
Neither Microsoft nor the new companies would be allowed to threaten personal computer makers for using rival products or to withhold licenses and technical support needed to use the former Microsoft products.
The Justice Department also wants a ban on tying future use of Windows to any other Microsoft products.
Stimulating competition
The 17-page document had the support of 17 of the 19 US states, which were also involved in the landmark case.
"This is the right remedy at the right time," Attorney General Janet Reno said in a statement.
"Our proposal will stimulate competition, promote innovation and give consumers new and better choices in the marketplace."
What happens next?
10 May - Microsoft will give its response
17 May - The government files its rebuttal
24 May - Judge holds remedies hearing
Dates could change if Microsoft gets more time to prepare
Microsoft now has until 10 May to submit its counter-proposals to these "remedies".
The government's reply comes a week later, with the remedy hearing due on 24 May.
But the timetable could be delayed to give Microsoft more time to prepare its response.
Share price hit
Judge Thomas Penfield Jackson could make a ruling as early as the summer.
But Microsoft has made it clear it will appeal, and the trial is likely to drag on for years – Albawaba.com.
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