What It May Mean For Gates

O.K., so Microsoft lost the first round, big time. Assuming the two sides don’t settle out of court, it will fall to Judge Jackson to impose punishment–and that could be anything from a $1 fine to a cataclysmic breakup. DOJ lawyers haven’t decided which remedy to recommend, but it will probably be one of the following:

–By Chris Taylor

Microsoft Without Windows

Force Microsoft to spill its most treasured possession, the source code for Windows. This might be offered by auction to other companies, which could then go out and sell their own versions. Or the code could simply be declared public property and given away.

WHO WINS? Open-source advocates, who say all operating-system source codes should be freely available (as Linux’s is). The public might benefit if competition led to innovation. It could be harmed if software became even more confusing than it already is.

Unleash The Baby Bills

Cut the company vertically, into two or three little Microsofts. Each would continue to make and sell the full range of Microsoft software. Indistinguishable clones would probably end up confusing the marketplace. And given Microsoft’s long history of corporate acquisitiveness, how long would it take for one of the Baby Bills to swallow up the others?

WHO WINS? Whichever company gets Bill. Also Linux, Apple OS and any other competing operating system–if consumers sour on Windows PCs.

Carve It Into Little Pieces

Cut the company along neater lines so that one Baby Bill markets Windows, the next sells office software, etc. A recent reorganization of Microsoft’s internal divisions makes this option more difficult than it once would have been.

WHO WINS? Whichever company gets Windows, whose monopoly of the operating-systems market is what Microsoft has been leveraging all along. America Online might also benefit, if Windows loses Explorer and AOL-owned Netscape takes over the Web-browser market.

Tie It Up In Red Tape

Make Microsoft promise not to do it again by signing agreements to separate its operating system (Windows) from its Web browser (Explorer), or to sell Windows to all computermakers at the same price regardless of their relationship with Microsoft. This is the least dramatic remedy and the most likely to survive legal challenges.

WHO WINS? Microsoft. Critics point out that this is precisely what the Justice Department tried to do with the 1994 consent decree, and look how much good that did.

WHAT IT MAY MEAN FOR YOU

If you are a Microsoft stockholder, you might be in for a pleasant surprise after a period of bumps and sags (see Personal Time: Your Money). If you use Windows or other Microsoft programs or visit Microsoft’s popular websites, not much is likely to change in the near term–at least until the appeals are exhausted. What happens in the long term–to both the stock and the products–is anybody’s guess.