COURT NOTES: The first written arguments of the antitrust trial appeal were filed on November 27 by Microsoft. That brief, a summary of why Microsoft is appealing the original decision, did everything legally permissible to attack the prosecution and original judge who ordered Microsoft split in two earlier this year [see Jun. 19, 2000]. Microsoft first attacked the foundation of the case with an argument that said tying Internet Explorer to Windows never violated federal antitrust laws or a consent decree the company signed with the government in 1994. The 150-page filing (accompanied by a 'friend of the court' paper from two industry groups) went on to question the way Judge Thomas Penfield Jackson interpreted facts of the case and the way he applied the law to those facts. It then attacked Jackson himself for comments he made in interviews before the trial was complete. Out of the document's six total sections, two do nothing except attack the judge. Beyond that, Microsoft's argument was just another rehash of points made in the original case - but those points may make more of an impact on the new panel of judges, several of whom ruled in Microsoft's favor several years ago in a related hearing. The Department of Justice now has until January 12 to file its own version of the case summary, with oral arguments of the same points scheduled to begin the following month.
ALSO SEE: The Register, Wired News, The Register, C|Net, Court Site

In Europe at the same time, Microsoft finally filed its response to European Commission charges that it used persuasive and possibly illegal licensing methods to discourage competition in the server market. The response, originally scheduled for October [see Oct. 30, 2000], has not yet been made public although we expect it was a general attack against Sun Microsystems (the source of a complaint that launched the investigation) and a protest towards forced licensing of Microsoft's APIs, combined with a lot of garbage intended to slow down the lawyers pursuing the case. The Commission now has to wade through that massive pile of documents, and possibly choose to ask the company for more specific information. The EC will then use that information to decide if it should combine the server investigation with a separate case about Windows 2000 and decide what charges, if any, to file against the company.
ALSO SEE: InfoWorld, InfoWorld, C|Net

To prevent 'malicious' ActiveX code from wreaking havoc on a computer system, Microsoft requires ActiveX programs to have a digital certificate of authenticity before they will run. Now, in response to the proliferation of e-mail viruses that run scripts and programs on a host computer, Microsoft will be implementing a digital certification process for any programs running on future versions of Windows. That certification process would expand and solidify the mish-mash of code certification present in Windows 2000, and would add the option of blocking any uncertified applications from running. Unfortunately, just like the flawed ActiveX system, any applications that manage to include a faked certificate would be allowed to run loose inside the host computer while clueless network administrators sit on their hands assuming everything is ok because Microsoft is protecting them. This would also, as a side benefit for Ms, give the company more control over developers and earn it still more money through certification fees.
ALSO SEE: The Register, Sm@rt Partner

In the race to develop accurate speech recognition and translation technology, the hands down leader for several years has been Belgium's Lernout & Hauspie Speech Products. With L&H's purchase of Dragon Systems earlier this year [see Apr. 03, 2000], the number of serious competitors was reduced to only three - L&H, Microsoft, and IBM. (Never one to bet on a single horse, Microsoft made an eight percent investment in L&H back in 1997.) But after a $1.5 billion spending spree earlier this year and some accounting irregularities in Korea that resulted in millions of dollars disappearing, Lernout & Hauspie has been forced to file for chapter 11 bankruptcy in Belgium and the US. Hopefully the company will be able to survive with a reorganization and some low-interest loans, but if those don't wrk out L&H will be looking for a buyer. And who better to buy the company than a large corporation that already has a significant investment in it? If Microsoft can pick off the assets and employees of L&H for a song, expect the speech recognition/translation market to follow the operating system and office suite markets right down the toilet and into Microsoft's pocket.
ALSO SEE: C|Net, InfoWorld

On November 28, Microsoft released a second beta of FrontPage 10 to about 10,000 testers. FrontPage, which will apparently be the only standalone Microsoft development tool after the next release of VisualStudio, is expected to ship sometime next fall when Office 2001 hits store shelves. FP 10 will support XML and current Web standards, along with Microsoft's proprietary additions to each and every one of them. A spokesman for The Behemoth added that the version now being tested will also include new features to make FrontPage easier for small businesses and home users to operate (read: dumbed down interface and endless help wizards).
ALSO SEE: ZDNet

As Microsoft prepares to integrate its Media Player product into future versions of Windows and Internet Explorer, several security holes in the software have been located. The first problem relates to the custom skins available for Media Player 7 - a skin could, theoretically, include a script of some kind that would damage a computer or send personal information back to the script's author. A second problem is with the .ASX file redirect format in Media Player - the software that handles .ASX code uses an unprotected memory buffer that could be overrun and allow unauthorized code to be run. Microsoft has released patches for both problems, but there could be countless other holes that remain unknown.
ALSO SEE: InfoWorld

If it wasn't enough of an investment bank and mutual fund already, Microsoft has hired a banker to serve as one of its executives. Richard Emerson, former director of the Lazard Freres investment bank, is now set to become Microsoft's new senior vice president of corporate development and strategy. According to a press release, Emerson will be overseeing Microsoft's investment activities and buyouts.
To increase demand for its electronic book format, Microsoft and Pulse Data International are working on an eBook reader for the blind and visually impaired. The devices, which will translate eBooks into braille, are expected to go on sale next summer for about $4000 each. The only competition for the eBook reader is a similar device created by the US government which as of yet has no manufacturer.
Dell, undoubtedly Microsoft's closest OEM partner, has announced a deal that gives anyone purchasing a new Dell computer free MSN Internet access for a year. The new service, which will be offered under the Dell.Net brand, replaces a similar arrangement Dell had with WorldCom's UUNet.

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