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The BBC's Jon Kay
"Bill Gates says he wants a settlement"
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BBC News Online's Kevin Anderson
"Microsoft didn't expect any kind of punishment"
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Saturday, 20 November, 1999, 10:34 GMT
Microsoft trial mediator welcomed
Microsoft was taken to task over its pricing behaviour

Both parties in the Microsoft antitrust trial have welcomed the appointment of a federal mediator to oversee settlement talks between the US Government and the software giant.

Microsoft spokesman James Cullinan described it as "a very positive step" toward resolving the case.

"We look forward to working with Judge Posner to try to find a fair and reasonable solution," he said.

The Justice Department said it wanted to work with the mediator "to discuss ways to address serious competitive problems identified in the course of the findings of fact."

The surprise move improves the prospects of an out-of-court settlement.

Judge Thomas Penfield Jackson, the judge in the trial, appointed Richard Posner, a widely respected chief judge for the 7th US Circuit Court of Appeals in Chicago.

He has left it up to Judge Posner to schedule any talks.

After the close of regular US trading, shares of Microsoft rose to 89.5 in heavy trading from their Nasdaq close at 86.

The Justice Department calls Richard Posner "a highly respected jurist"
The US Justice Department and 19 US states had charged Microsoft, the world's biggest software company, with abusing its monopoly power in order to sell more copies of its own internet browser and damage the business prospects of rival browser Netscape Navigator.

Microsoft argued that, although its Windows operating system runs on 90% of the world's personal computers, it did not act as a monopoly. The company said it benefited its customers by giving them additional features at no extra cost.

Judge Jackson disagreed and two weeks ago he ruled that Microsoft was a monopoly that stifled competition and hurt consumers.

Will Bill Gates be persuaded to reach a deal?
However, he has actively encouraged the two sides to settle their dispute.

In what was seen as an unusual move, he structured the verdict to come in two phases in an apparent effort to push parties towards the bargaining table.

The two sides have had face-to-face talks three times since the trial started in October 1998, but they still appear far apart on crucial issues despite recent statements that they are open to settlement.

In remarks made earlier this week, Microsoft Chairman Bill Gates appeared willing to negotiate on some points.

However, Mr Gates said Microsoft would not surrender its right to decide which features could be added to Windows.

He also indicated his opposition to a public auction of the software code for Windows.

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See also:
06 Nov 99 |  The Company File
How much will it hurt Microsoft?
06 Nov 99 |  Sci/Tech
Analysis: Microsoft taken to task
06 Nov 99 |  Americas
The judge who frightens Microsoft

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