New licensees point to progress, Microsoft says

Microsoft Corp. says that it is continuing to comply with the final judgement in the U.S. government's antitrust case against it, holding up as proof four new licensees of its Microsoft Communications Protocols Program (MCPP), which allows third-party products to interoperate with Windows clients.

The fact that Cisco Systems Inc., Tandberg Television Ltd., Laplink Software Inc. and The SCO Group Inc. have all executed licenses under the MCPP program in the last few months "attests to the reasonableness of the terms offered," Microsoft said in a court filing made Friday.

The filing was made to U.S. District Judge Colleen Kollar-Kotelly as part of a joint status report on the software maker's adherence to a final judgement in the U.S. Department of Justice's antitrust case against Microsoft, made last year.

The agreement requires Microsoft to make available licenses for certain Windows communication protocols under reasonable and nondiscriminatory terms. In a joint status report filed in July the court said that it remained "very, very concerned" about the licensing program.

However, Microsoft said Friday that it has taken steps to exceed the requirements of the final judgement by rewriting licensing terms to make them easier to understand, reducing royalty payments and undertaking a marketing campaign to attract potential licensees.

Microsoft said that SCO's decision to become a licensee attested even further to its progress, given that SCO offers general purpose servers that compete with Microsoft.

Additionally, the company said that it is in discussions with nearly 40 potential licensees, including Sun Microsystems Inc., which has entered an evaluation agreement.

Despite this, the plaintiffs said in Friday's filing that they believed Microsoft's progress "has been limited" and that they intend to interview companies that have chosen not to take part in the licensing program to determine whether it can be further improved.

As Microsoft works to persuade the court that it is complying with remedies in the U.S. case, it is also preparing to answer antitrust concerns made by European authorities. A company spokesman said Friday that Microsoft is about to submit written responses to the European Commission regarding antitrust complaints.

Commission representatives would not say Monday whether they were monitoring Microsoft's compliance with the U.S. government's case.

In addition to evaluating some of Microsoft's licensing agreements, plaintiffs in the U.S. case said Friday that they are also concerned about a feature of Windows XP called "Shop for Music Online," which allows users to go online and purchase CDs.

The plaintiffs said that they are concerned that the feature invokes Microsoft's Internet Explorer browser rather than the user's chosen default browser in a way that potentially muscles out the competition. Microsoft and the plaintiffs are currently in extensive talks over the issue and may seek the court's assistance, the filing states.

The next status conference on the U.S. case is scheduled for Oct. 24.

European Commission regulators are expected to make a ruling regarding their antitrust concerns early next year.

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