Microsoft Starts the Second Half

Midway through the Microsoft case, and the highlights from the first half don't look good -- full of clips of Microsoft lawyers and flacks fumbling nearly everything the feds threw their way. Of course, since the government closed its case Monday, and Microsoft gets to put on its own witnesses, only a sucker could predict the winner. Yet so far, the feds have clearly scored most of the points. "David Boies put on a solid case for the government, maybe a little better than expected," says TIME's Adam Cohen. "Of course, this is only halftime, and we have no idea what Microsoft will be able to do."

What Microsoft did was come out with a bang: MIT prof Richard Schmalensee, who testified that if Microsoft was a monopoly, it sure wasn't doing a very good job at it. Noting that the company has sold 125 million copies of the ubiquitous Windows 95 at an average price of $56, Schmalensee wondered why Microsoft wouldn't simply charge more if it could -- an extra 5 percent would earn the company a cool $173 million. That it didn't, he said, was evidence that competition exists.

While Microsoft would like a win here, Judge Thomas Penfield Jackson hasn't exactly been sympathetic to the company; the software Goliath is almost certainly looking to a higher court for vindication. "The court of appeals and the Supreme Court have shown themselves recently to be very reluctant to rule against companies in antitrust cases," notes Cohen. For now, Gates can keep those Hail Mary plays on ice.