News Release

ATTORNEY GENERAL MIKE MCGRATH
STATE OF MONTANA

McGRATH, ATTORNEYS GENERAL: MICROSOFT'S NEW WINDOWS XP "ANTI-COMPETITIVE"

LETTER TO MICROSOFT CEO STEVE BALLMER

September 20, 2001

Steven A. Ballmer
Chief Executive Officer
Microsoft
One Microsoft Way
Redmond, WA 98052-6399
Fax No. 425-936-7329

Dear Mr. Ballmer:

In 1998, the Department of Justice and a significant number of state attorneys general filed a lawsuit alleging that Microsoft had monopoly power in the operating system market and that the company had engaged in illegal predatory practices to maintain this monopoly. Our states are not parties to the pending litigation. However, we have a continuing interest in issues relevant to the litigation.

Today we write to you to express our support for concerns raised by the states and the Department of Justice in the litigation. We add our voices to those calling on Microsoft to remedy the antitrust problems that are now evident. We take this action for three reasons.

First, as a result of the trial record, we now have the ability to review a complete record of evidence concerning Microsoft's activities over the past several years to maintain its monopoly in the operating system market. Second, the district court's finding of monopoly maintenance was confirmed unanimously by the United States Court of Appeals for the District of Columbia Circuit. Finally, given our understanding of Microsoft's new Windows XP operating system, which is about to be released, we are concerned that aspects of this new product may lead to further erosion of competition in various software markets.

We are concerned that Windows XP may involve additional unlawful attempts by Microsoft to maintain its operating system monopoly. Notwithstanding the notable technological achievements imbedded into some of the products and services offered by Windows XP, Microsoft may have constructed this new product without due regard for relevant legal rulings, and without due regard for other issues involving consumer choice and consumer privacy.

Moreover, there are many state governmental agencies currently using existing versions of Windows, and there are significant expressions of concern that Microsoft will be in a position to withdraw support for products currently in use in favor of Windows XP.

We agree with our colleagues, the litigating states and the federal government, that any anti-competitive aspects of Windows XP should be addressed. As the Court of Appeals succinctly stated, the remedy must, to the extent possible, "unfetter [the] market from anticompetitive conduct, ... and ensure that there remain no practices likely to result in monopolization in the future." We therefore are supportive of efforts of the litigating states and the Department of Justice to incorporate Windows XP into the remedy phase of the remanded case.

Sincerely,

William H. Sorrell
Vermont Attorney General

On behalf of himself and:

Mark Pryor
Arkansas Attorney General

G. Steven Rowe
Maine Attorney General

Mike McGrath
Montana Attorney General

Phillip McLaughlin
New Hampshire Attorney General

Sheldon Whitehouse
Rhode Island Attorney General

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