Danny Westneat / Times staff columnist
Winning, losing and Microsoft

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It never mattered how bad the news was for the software giant. It could be the judge had savaged the company's integrity. Or Chairman Bill Gates had said "I don't know" 200 times in a deposition.

The company's response was always the same: "Another great day for Microsoft!"

The defiant optimism was comical — everyone knew Microsoft was losing. But the company was so insistent and powerful that still I'd wonder: Maybe it really is a great day for Microsoft, and only the company is smart enough to see it.

These memories came back to me Monday, when after seven years the U.S. antitrust case against Microsoft finally came to a close.

It ended, fittingly, when Microsoft ate the last critic standing.

The company paid the legal fees of its arch-nemesis, a trade group of competitors. Then Microsoft joined the group, which dropped an appeal of the antitrust settlement.

Other companies will battle Microsoft here and in Europe — particularly Seattle's RealNetworks. But the federal government's case is no more.

It's a good time to look back and ask: Who won it, anyway?

Conventional wisdom sides with Microsoft. Yes, the case has led it to pay more than $4 billion in cash settlements. But when you have $60 billion in cash, so what?

There was no company breakup. The government did not impose much in the way of severe business restrictions.
 
But life for Microsoft also has changed in ways that cannot be making the titans of Redmond happy.

For starters, the company's business practices were put on display for the world. The courts found it was a monopoly and that it had repeatedly abused its monopoly power.

It was the antitrust equivalent of a guilty verdict.

Today, some of the leading companies and markets in the world seem reluctant to work with Microsoft, for fear they, too, will be eaten. Take Nokia, the largest maker of cellphones. It is so hostile that it dropped out of the trade group this week in protest of Microsoft joining.

Or China. State planners there keep pushing a rival operating system, Linux, undermining Microsoft's plan to profit in a huge emerging market.

Or Sony. The sometime partner has turned into a fierce rival to control whatever succeeds the personal computer.

A former Microsoft executive I know says he used to think the company had lost each antitrust battle but still won the war. Now he has switched, and believes the company is wounded heading into a major business war.

Yesterday, at its shareholder meeting, executives promised that it is still a great day for Microsoft.

I'm not sure I'd bet against them. But they don't sound as convinced as they used to.

Danny Westneat's column appears Wednesday and Friday. Reach him at 206-464-2086 or dwestneat@seattletimes.com