The U.S. Justice Department and 20 states formally filed antitrust lawsuits against Microsoft Corp. on Monday, launching what may be one of the biggest battles in history with big business.
The antitrust lawsuits were filed in U.S. District Court in Washington, D.C., and accuse Microsoft of using its dominant Windows operating system to force computer makers to use its Internet browser. The U.S. government and the states asked the court to stop Microsoft from requiring computer makers to use its Internet Explorer Web browser.If Microsoft does include its own browser in its Windows 98 operating software, the Justice Department asked the court to insist it also include the browser of its rival Netscape Communications Corp.
"Microsoft's actions have stifled competition in the operating system and browser markets. It has restricted the choices available for consumers in America and around the world," Attorney General Janet Reno said at a press conference announcing the action.
Reno said Microsoft used its monopoly position "to develop a chokehold" on the browser software needed to access the In-ter-net.
In Seattle, Microsoft Corp. said Monday the federal and state antitrust lawsuits filed against it were "without merit" and vowed to fight the case in court.
"We believe these lawsuits are without merit and will hurt consumers," Microsoft spokesman Jim Cullinan said. "We will resolve this in the courts."
Last week Bill Gates, the intensely competitive billionaire Microsoft Corp. chairman, brought the wheels of justice to a grinding halt, offering 11th-hour concessions that forestalled a landmark antitrust case against the company.
But then just as abruptly Gates ordered his lawyers home to Seattle, declaring "the government demands went too far."
The flurry of activity was characteristic of the steel-nerved negotiating skill Gates has demonstrated in eight years of battling with regulators. Although the lawsuits filed Monday are the biggest threat yet, so far Gates has emerged with barely a scratch, his suburban Seattle-based company poised to dominate vast new areas of commerce.
At the same time Gates, 42, has seen his 22 percent stake in the company he co-founded swell in value to an almost unimaginable $46 billion, making him the richest person in America and quite possibly the world.
The onetime high school computer nerd has become an unlikely international celebrity, a symbol of the world's accelerating shift toward an information-based economy and the public's fascination with vast wealth.
The story of William Henry Gates III is no rags-to-riches tale but still astounding for his ability to stay on top of an industry littered with the wreckage of rival companies.
Gates was born Oct. 28, 1955, the second of three children in a prominent Seattle family. His father, William Henry Gates Jr., is a name partner at one of the city's most powerful law firms, while his late mother Mary was an active charity fund-raiser and a University of Washington regent.
A gangly but gifted child, Gates found his milieu at Seattle's exclusive Lakeside preparatory school, where as a 13-year-old prodigy he began programming in the BASIC language on a primitive Teletype unit. By the time he was 17, Gates had sold his first program - a scheduling system for the school which brought him $4,200.
It was at Lakeside that Gates met Paul Allen, a student two years his senior who shared his fascination with computers.
"Of course, in those days we were just goofing around, or so we thought," Gates wrote in his book "The Road Ahead."
Gates spent two years at Harvard University, devoting much of his time to programming marathons and all-night poker games before dropping out to work on software for the Altair, a clunky desktop computer that cost $400 in kit form.
Gates and Allen soon set out for Albuquerque, New Mexico, where they established Microsoft in 1975, naming the company for its mission of providing microcomputer software, which Gates was convinced would be more important than hardware.
Microsoft's big break came in 1980 when Gates and his un-der-dressed young colleagues signed an agreement to provide the operating system that became known as MS-DOS for International Business Machines Corp.'s new personal computer.
The blue suits at IBM never knew what hit them.
In what ended up being a critical blunder on IBM's part, Microsoft was allowed to license the operating system to other manufacturers, spawning an industry of "IBM-compatible" personal computers dependent on Microsoft's operating system.
In March 1986, Microsoft stock went public in one of the most celebrated offerings of the decade. By the next year, the company's soaring stock price had made Gates the youngest self-made billionaire at age 31.