Battle rages over blame for MS talks failure

But what was it the states proposed?

MS on Trial The collapse of the Microsoft mediation talks over the weekend has rapidly turned into a major whodunnit. Microsoft, splits in the government camp, even saboteurs from the states have all been blamed, and the stories are already being spun in several directions. Anonymous sources speaking to AP yesterday claimed that the talks failed because Microsoft was determined to push through its own proposal, and rejecting the government one. These sources also insist that the talks didn't collapse because of splits between the DoJ and the states, so they're clearly spinning from somewhere in the government camp. Meanwhile, on the record in several places we have Connecticut attorney general Richard Blumenthal, insisting that the differences between the DoJ and the states were minimal compared to those between the government and Microsoft. So the spinning so far indicates that it was Microsoft intransigence that sank the talks. But how true is that? An interesting piece by Joel Brinkley in today's New York Times pitches it rather differently: "Over the weekend, an official allied with the states complained that the Justice Department had been trying to ram through an inadequate settlement proposal without bothering to involve them. But a lawyer who was close to the talks had a different point of view, saying the states were 'trying to snatch credit for sinking the talks' in part because 'they're tired of being in the back seat.'" Brinkley also notes that during the talks the DoJ and the states have never actually sat down together to try to work out a joint proposal for remedies. This means that, with the judge likely to deliver his verdict any time, they're going to have to do this in the very near future. Despite Blumenthal's attempts to smooth things over in public, it's simply impossible that the DoJ and the states could be entirely in agreement right now. During the talks the DoJ seems to have been willing to accept a conduct remedy, i.e. one where Microsoft agreed on limitations to its behaviour, while at least some of the states still push for a structural one, i.e., breakup or similar. It's worth bearing in mind that Judge Jackson's advisor Lawrence Lessig cast doubts on the viability of structural remedies in December, so Microsoft might reckon it's most unlikely that the judge himself will impose one. Some more pieces of the story of the talks failure are starting to fall into place. In his statement on Saturday, Judge Posner said that it had become clear on Friday that the two sides were too far apart. But he also said that a consent decree had gone through almost 20 drafts during the talks. Microsoft apparently produced a new draft of its proposals late on Friday, and these were deemed unacceptable by the DoJ and the states. But the states also made new proposals on Friday, and these may have raised the stakes further than Microsoft was willing to go. Brinkley's NYT piece quotes an unnamed official close to the talks as saying the DoJ's final settlement proposal could be "fairly criticised" for not being tough enough, but that it "was a tradeoff between quick and immediate relief versus comprehensiveness." This official puts forward a number of issues that caused the failure, but curiously these seem in the same categories as Microsoft's earlier proposals were said to be, i.e. they're all points Microsoft has moved on, which would mean the arguments were over the company not moving far enough. According to this source, there were differences over: whether Microsoft would offer a version of Windows with no browser, or one that was easily removable; whether Microsoft would publish APIs; whether it could continue exclusive deals with ISPs to promote Microsoft products; and whether Microsoft would be allowed to tie products to Windows via OEM contracts. None of these seem absolute sticking points, surely no greater than they were several days earlier when Judge Posner asked Kackson to postpone his verdict. But it's still not clear what was in the proposal from the states on Friday - perhaps that will become clearer as the states and DoJ put their heads together at last. ® Related Stories Judge attacks 'leaking and spinning' in MS talks MS guilty verdict looms as mediation talks collapse New York Times story Complete Register Trial coverage

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