o Apple Computer, the proposal by Microsoft and plaintiffs to settle more than 100 class-action antitrust lawsuits against Microsoft is riddled with flaws -- and carries a big competitive threat.
Microsoft's proposal to donate more than US$1 billion in software, computers and expertise to the nation's poorest schools would do little damage to the company's bottom line, Apple and other critics say, but would help it shore up its lead in one market it does not already dominate: education.
Apple has long been a significant player in the education market for computers, though its share has been shrinking in recent years.
"It strengthens Microsoft's position in education against their only competitor, and at the same time it gets them off the hook," said Roger Black, an industry analyst with the market research firm IDC. "It even makes them look generous."
Yet Microsoft and other proponents of the settlement insist that the deal would give the company no new advantage in the market because it would establish a grant program giving schools money to buy software. They say the program is designed so that participating schools can use the grants to buy Apple equipment and software other than Microsoft Windows. And as part of the settlement, Microsoft would establish a computer refurbishment plan that would make 200,000 Windows machines and Apple Macintosh computers available to schools.
Apple Chairman and Chief Executive Steven Jobs thinks the deal gives Microsoft tremendous advantages. "We're baffled that a settlement imposed against Microsoft for breaking the law should allow, even encourage, them to unfairly make inroads into education -- one of the few markets left where they don't have monopoly power," Jobs said.
In a document filed with the court last week, Apple asked that every aspect of the donation program be handled independently of Microsoft.
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