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Sun's McNealy again rails against Microsoft By Margret Johnston February 8, 2001 3:47 pm PT update WASHINGTON -- SUN Microsystems Chairman and CEO Scott McNealy Thursday said he believes Microsoft continues to leverage its monopoly in desktop operating systems by investing in an assortment of companies, including content and infrastructure providers, and this is bad for consumers because it limits choice and stifles innovation.
"We've got a problem right now. I think choice and having consumer choice and innovation put back into the technology industry will be very, very critical," McNealy said. A vocal supporter of the U.S. Department of Justice's antitrust case against Microsoft, McNealy said he would not oppose a settlement of the case "as long as they put consumer choice and innovation back into the system." Microsoft's appeal of the judgment issued against it last year by U.S. District Court Judge Thomas Penfield Jackson will be heard in Washington at the end of February. But McNealy said to him it is clear that Microsoft's actions were illegal. "I believe anybody who sits down and rationally takes a good hard look at [the case] comes to the same conclusion that the judge came to. This is clearly anti-competitive behavior that is bad for the consumer, " McNealy said. "This is not an emotional issue, this is not a political issue. It's not a financial issue. This is absolutely about putting competition and choice and innovation into, I think, one of the most critically enabling technologies." McNealy, who wrote an honors thesis on antitrust while a student at Harvard, also praised U.S. antitrust law, saying it has kept the business climate in the country much more competitive than that of other countries. Although slow at times, the Justice Department has always delivered and has always been effective in creating a pro-consumer competitive market, he said, urging the new administration of President George W. Bush to maintain that focus, not by creating new laws, but by enforcing regulations already on the books. About the economy, McNealy said the sagging stock price of technology companies does not mean the bubble has burst, but he would agree that "a lot of bad business models [have] burst." For most technology companies, there is still a lot of opportunity, he said. "We have just begun on the Internet. What is going to happen is every device with a digital or electrical heartbeat will get connected to the Internet," McNealy said, holding up his pen as an example, which lights up when he receives a call on his cell phone. McNealy recommended the newly sworn-in Congress and the Bush administration make priorities to lower interest rates, figure out an energy policy, and cut taxes. "We are going to have to work on all three of those big time, or a bad thing is going to happen and CEOs down the road are going to have to figure out how many folks they have to fire," McNealy said. Interest rates, although lowered recently by the U.S. Federal Reserve, are still too high, he said, and this is delaying the build-out of broadband infrastructures because the cost of capital is too high. The answer to California's energy crisis, which he said has had a serious impact on Sun's operations, is nuclear power, he said. As for the new tax policy set forth by Bush, McNealy endorsed it. "The government is too big, it's doing things it shouldn't be doing that would be better left to the private sector. We don't have a surplus, we have an overcharge," McNealy said of the tax money that has flowed into government coffers during the past few years of prosperity. "We need to get discretionary spending back into the hands of individuals." On other issues, the Sun chairman said his company continues to lobby for an easing of export controls on computers and privacy legislation, although he feels uneasy about the government legislating privacy because there is no way it can keep up with "the nuances of online information." McNealy also suggested that government agencies pool money "from other things they should be spending it on" to hire software developers to write online curriculum for elementary and secondary schools. The students could work at their own pace, have content on demand, and test themselves against other students their own age. He said such a program would be better than the E-rate program that taxes telephone service and uses the money to provide Internet access and telecommunications services to schools and libraries. Margret Johnston is a Washington correspondent for the IDG News Service, an InfoWorld affiliate. RELATED ARTICLES SPONSORED WHITE PAPERS
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