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Ballmer Describes Effects of Antitrust on Microsoft

Microsoft CEO Steve Ballmer sent an e-mail to customers Wednesday night describing how Microsoft has matured during the antitrust case and how lessons from the legal quagmire are making Microsoft into a more responsible industry leader moving forward.

The e-mail was a shortened version of a speech Ballmer delivered earlier in the week on the same topic at the Brookings Institution in Washington, D.C. The two communications are Ballmer's first efforts to characterize Microsoft's future since Judge Colleen Kollar-Kotelly on Nov. 1 approved the antitrust settlement between the Department of Justice, nine states and Microsoft with very minor modifications from the settlement challenge by nine other states and the District of Columbia.

The e-mail and speech follow a general Microsoft script, which has been not to gloat over a settlement that avoided harsh remedies such as a company break-up or requirements to make key software open source. Instead Microsoft officials have appeared contrite and repeatedly called the settlement "tough by fair."

"I believe we are creating an entirely new Microsoft," Ballmer wrote Wednesday. "We have learned a great deal from our experiences of these past few years, in particular about our responsibilities as an industry leader. During the antitrust lawsuit, not everyone in our industry raced to support us. As we listened to our supporters -- and our critics -- we learned that we needed to take a different perspective on being a good industry leader."

Ballmer contends that as recently as five years ago, Microsoft officials tended to think of themselves as a startup company.

"When I joined in 1980, we had about 30 employees, and we never dreamed, in our wildest imaginations, that we would eventually employ over 50,000 people in more than 70 countries," Ballmer wrote. Elsewhere in the e-mail, he declared, "Today we recognize that our decisions have an impact on many other technology companies. We have an important leadership role to play in our industry, and we must play by new rules -- both legally and as determined by industry trends."

Ballmer offered several events and initiatives as evidence that, post-antitrust, Microsoft is maturing into a responsible industry leader. Most of Ballmer's examples were well known Microsoft actions with complex motivations recast into the simpler theme that they represent a responsible post-antitrust Microsoft.

One is Microsoft's efforts to work through standards bodies to develop XML. Another is the company's recent work with IBM, VeriSign and others to develop security solutions based on industry standards, "enhancing security for the entire technology industry and its customers." Ballmer also said Microsoft is cooperating more with all levels of government to fight identity theft, cyber-crime and attacks on the Internet.

One new piece of information Ballmer supplied as evidence of Microsoft's growing maturity: the company has internalized new values into employee performance reviews. "We're committed to being upfront about what we are doing and who it affects, open in communicating about every aspect of our business, and sensitive to the new issues of corporate governance that have become increasingly important to market confidence."

The full text of Ballmer's e-mail is available here:
http://www.microsoft.com/mscorp/execmail/.

The longer speech can be found here:
http://www.microsoft.com/presspass/exec/steve/2002/11-12brookings.asp.

About the Author

Scott Bekker is editor in chief of Redmond Channel Partner magazine.

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