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Judge asks why Microsoft hasn't sold more licenses

Another compliance hearing is now set for January

By Grant Gross
October 24, 2003 12:00 PM ET

IDG News Service - A U.S. District Court judge has asked the U.S. Department of Justice (DOJ) to investigate why only nine companies have signed up to license Microsoft Corp.'s technology for their own software products, an offering that's part of the federal antitrust settlement with Microsoft.
During an antitrust settlement oversight hearing today, Judge Colleen Kollar-Kotelly questioned why more companies hadn't taken advantage of the licensing portion of the antitrust settlement, which she approved late last year.
Kollar-Kotelly, of the U.S. District Court for the District of Columbia, asked the DOJ to interview software companies to see if changes are needed in the licensing terms in the antitrust settlement. In a July hearing, she said new licensing terms that Microsoft would later announce should satisfy concerns over royalty rates that the company was charging for its communications protocols.
Microsoft previously agreed to reduce an advance payment for licenses from $100,000 to $50,000 and to require royalties of 1% to 5% of the revenue from any products that use the protocols.
A representative of the DOJ wasn't available today to comment on the judge's request, but Microsoft spokesman Jim Desler said his company looks forward to any findings after the DOJ speaks to software vendors. Kollar-Kotelly has scheduled another antitrust settlement compliance hearing for January.
In a status report released Monday, the DOJ noted that Microsoft has made "limited" progress in obtaining more licenses. But the DOJ report didn't request that the judge take any specific action right now, instead suggesting that "further steps may need to be taken in order to effectuate the goals of the remedy."
Microsoft last week defended its progress, saying the company is talking with close to 40 vendors about licensing its technology. Desler said the number of licensees has increased from four to nine in three months, which he said is evidence of a significant effort on Microsoft's part, Desler said.
"We've taken some aggressive steps in terms of promoting this program and in terms of educating the industry about it," Desler said. "We've more than doubled the number of licensees we have in three months. This does show some momentum, but this is still a work in progress."
Some companies' software may be able to interoperate with Microsoft products, making the licenses unnecessary, Desler said. "I think the judge wanted to know whether or not [the number of licenses] is due to the terms and conditions of the licensing program or whether it is due to a lack of interest on some parties. This is just simply a natural part of the compliance process."
Asked if Microsoft would support further revamping of the licensing terms if that's where the DOJ investigation led, Desler didn't commit to more changes. "I think we just take this whole process step by step," he said. "The next step is for the Department of Justice to talk with industry and report back on what they've learned."

Reprinted with permission from Story copyright 2014 International Data Group. All rights reserved.
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