MEDIA WATCH: Gates and Microsoft find support in the news media

William H. Gates has come a long way from the young man who left Harvard over two decades ago to found a software company in New Mexico.

William H. Gates has come a long way from the young man who left Harvard over two decades ago to found a software company in New Mexico.

William H. Gates has come a long way from the young man who left

Harvard over two decades ago to found a software company in New

Mexico.



A decade later and now based in Washington, that company began drawing

the attention of US antitrust authorities. When Gates arrived in the

other Washington - after federal judge Thomas Penfield Jackson’s ruling

that Microsoft had violated US antitrust laws - Gates found a city

divided, with the judicial branch condemning him and the legislative

branch welcoming him with open arms.



CARMA’s analysis of ensuing media coverage after Judge Jackson’s ruling

found the media focusing significant attention on Bill Gates as a

philanthropist and as someone who had successfully changed congressional

lawmakers’ opinion of him for the better. The Washington Post (April 6)

noted of Gates’ visit, ’With lawmakers swarming him for autographs and

schoolchildren snapping pictures, Microsoft Chairman Bill Gates swept

through Capitol Hill ... yesterday with a fanfare worthy of a

superstar.’ Articles also noted that enthusiasm was bipartisan.



Coverage also frequently focused on the uncertainty surrounding

Microsoft’s stock price as the federal case continued. USA Today quoted

CIBC analyst Melissa Eisenstat as saying, ’If you have patience long

term, it’s a great company’ (April 5). Another analyst quoted in the

same article, Donald Selkin of Joseph Gunnar, said, ’It’s basically dead

money ... it’ll just drift.’



Media coverage also highlighted the potential for private class action

lawsuits stemming from the judge’s ruling. The Los Angeles Times (April

6) noted that more than 100 consumer class action suits are pending, and

’for those suits and new ones, Jackson’s ruling has tremendous legal

significance.’ There was also a notable amount of media attention that

focused on technology that would make the decision irrelevant. ’The

technological change that displaces or devalues Windows could be a shift

to Web-based software that runs on any computer,’ noted the Los Angeles

Times (April 5).



There was even coverage that addressed the potential benefits to

Microsoft if George W. Bush were to win the US presidential election

this fall.



’The company may also benefit from a change in the White House since

Governor George W. Bush ... has suggested that antitrust enforcement

should be confined mainly to price-fixing cases,’ said The New York

Times (April 4).



Some coverage speculated on what legal remedy Judge Jackson is likely to

impose on Microsoft. His two main options are to impose structural

changes on the company or to break it up into distinct entities that the

media likes to call ’Baby Bills.’ The latter move is considered the most

drastic. The Wall Street Journal pointed out, however, ’We may see a

proposal to break up Microsoft, but the Justice Department did not

discuss this possibility (with the company)’ (April 5).



It remains to be seen whether congressional lawmakers’ warm reception of

Gates will impact the legal battle his company is losing in the federal

courts.





- Evaluation and analysis by CARMA International. Media Watch can be

found at www.carma.com.



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