Microsoft is no longer under a Department of Justice microscope. Oversight from the DOJ in the wake of a high-profile antitrust suit expired Thursday.
"As a result of the Department of Justice Antitrust Division's efforts in the Microsoft case and final judgment, the competitive landscape changed, allowing the marketplace to operate in a fair and open manner, bringing about increased innovation and more choices for consumers," the DOJ said. "The final judgment helped create competitive conditions that enabled new kinds of products, such as cloud-computing services and mobile devices, to develop as potential platform threats to the Windows desktop operating system."
The DOJ accused Microsoft of using its market heft to roll over competitors. Words like monopoly were used as the DOJ and attorneys general for 19 states plus the District of Columbia filed suit against Microsoft in 1998, claiming violations of antitrust laws.
After discussions ordered by a federal court, Microsoft reached a settlement -- often referred to as the consent decree -- with the DOJ in 2001. Nine states joined in that agreement, while seven others continued to pursue their claims separately before accepting a final court judgment in 2002. One state appealed the ruling, but it was upheld in 2004 by the U.S. Court of Appeals.
Following the antitrust action, Microsoft faced a number of class-action lawsuits. But unlike the government's case, which alleged that Microsoft used its market position to harm competition by incorporating new features into Windows operating systems at no additional cost, the private suits claimed Microsoft overcharged consumers.
"Our experience has changed us and shaped how we view our responsibility to the industry," Microsoft spokesperson Kevin Kutz wrote in a statement published online. "We are pleased to bring this matter to a successful conclusion."
Microsoft's Bold Acquisition
Microsoft's first major move in anticipation of the expiring DOJ oversight was the $8.5 billion acquisition of Skype in an all-cash deal Tuesday. Skype will support Microsoft devices like Xbox and Kinect, Windows Phone 7, and other Windows devices. Microsoft will also connect Skype users with Lync, Outlook, Xbox Live, and other communities it owns. And Microsoft will continue to invest in and support Skype clients on non-Microsoft platforms.
"Skype is a phenomenal service that is loved by millions of people around the world," said Microsoft CEO Steve Ballmer. "Together we will create the future of real-time communications so people can easily stay connected to family, friends, clients and colleagues anywhere in the world."
Skype boasts about 170 million connected users who logged more than 207 billion minutes of voice and video conversations in 2010. Of course, Microsoft is no stranger to real-time communications. Microsoft Messenger is one of the most popular instant-messaging platforms in the world, and Microsoft also owns Hotmail, Lync, Outlook and Xbox Live.