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CONSENT DECREE
The US Government and Microsoft Corporation (Microsoft) entered into an
agreement outlined by this Consent Decree (sometimes referred to as the
Final Judgment) after the Civil Trial of 1994. The Civil Trial was
mostly concerned with Microsoft's licensing practices, in particular their
Per Processor licensing practice, which charged OEMs (Original Equipment
Managers) a licensing fee for a Microsoft operating system (OS), whether
or not the OEM installed Microsoft's, or another company's OS.
The Consent
Decree covers Microsoft Products including MS-DOS, Windows 93, Windows
95, and any successor versions of these products. It does not cover
Windows NT workstations or servers.
An outline of the main points of the Consent Decree follows:
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Microsoft may enter into License agreements of only up to one year in duration.
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Microsoft may allow the OEM to renew the license under the same conditions
as the existing license, but may not impose a penalty if the OEM chooses
not to renew. This does not cover the case where the OEM chooses
not to renew their license under the same conditions, but later enters
into a new license agreement with separate conditions, such as higher royalties.
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Microsoft's license agreements cannot restrict or prohibit OEMs licensing,
sale, or distribution of other, non-Microsoft products.
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Microsoft cannot enter into Per-Processor licensing agreements.
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Microsoft cannot enter into a license agreement where the terms of the
agreement are conditioned upon the licensing of another Microsoft Product,
or upon the OEM not licensing a non Microsoft product.
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Microsoft may not impose commitments of minimum sales on OEMs.
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Microsoft may not use Lump Sum pricing schemes.
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Microsoft may not impose unreasonable Non Disclosure Agreements (NDA) upon
employees. The details of what constitutes an unreasonable agreement
is outlined in the Consent Decree.
The Consent Decree can be broken into two sections: regulations for Microsoft's
licensing practices, and regulations for Microsoft's NDAs. The section
of the Consent Decree which was brought into question in the recent 1997
DOJ case (point #5), is actually only a one sentence sub-section of one
of the main terms of the Consent Decree.
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