For more information contact:

Microsoft Corporation							For Immediate Release
Greg Shaw or Mich Mathews						        	June 9, 1995	
(206) 882-8080

Waggener Edstrom
Marianne Allison or Alison O’Brien
(503) 245-0905

Edelman Public Relations
Leslie Dach or Paul Costello
(202) 371-0200

Microsoft says MSN is Pro-Competitive:
Expands Consumer Choice, Lowers Prices

	REDMOND, Wash. -- June, 9 1995 -- Microsoft Corporation said today that The Microsoft Network (MSN), its soon-to-be-released online service, is entirely pro-competitive -- offering a new, highly innovative product, increasing competition in online services and lowering prices.  Microsoft’s comments are in response to the Justice Department’s requests for information about Microsoft’s plans for MSN.  The company said it is cooperating fully with the Justice Department and remains confident that its plans are legal and in the best interest of consumers.  Microsoft said it has carefully examined the legal issues surrounding the distribution of client software for MSN and reiterated that the launch of Windows 95, including the MSN client software, remains on schedule for Aug. 24.

	“We believe Microsoft’s entry into online services will benefit PC users,” said William H. Neukom, Microsoft’s Senior Vice President for Law & Corporate Affairs.  “The online services business is an emerging, growing field.  We are a new entrant to the field with a terrific new product that we believe customers will want.   The result of our entry will be increased consumer choice and lower prices.” 

	Neukom said, “Microsoft’s products are popular with consumers, and we hope that MSN will be too.  We regret that some of our competitors, faced with new competition, have resorted to complaining to government regulators rather than competing vigorously in the marketplace.  The nation’s antitrust laws are an important part of our legal system but they exist to protect the competitive process, not particular competitors.  Entry of a new competitor with an innovative product and efficient means for exposing that product to potential users is always pro-competitive.  The software industry is characterized by increasing competition, falling prices, rapid innovation and broad customer choice.  This will continue so long as government regulators leave it to consumers to make decisions.”

	Consumers running Windows 95 will have a broad range of online services from which to choose.  All of the major online services are developing Windows 95-based client access software for their services. Windows 95 will also run the Windows 3.1-based client software that online services subscribers are currently using.  In addition, client access software for MSN will be included in Windows 95, providing Windows 95 users with the additional choice of subscribing to MSN.

	The MSN online service itself is not included in Windows 95.  Windows 95 users who wish to subscribe to MSN need to make a separate purchase decision, and pay separately for the MSN service. 
 
	“IBM, Apple and other computer manufacturers have been including the software necessary to subscribe to online services in their products for some time,” said Russell Siegelman, Microsoft’s General Manager for Online Services.  “IBM ships client software for Compuserve and Internet access with its OS/2 Warp operating system.  Apple includes client software for its own online service, eWorld, with its Macintosh computers. Other computer manufacturers include client software for America Online, Prodigy and Compuserve capabilities with their machines now.  There are many ways to distribute client software to potential online subscribers, including on the Internet.  Microsoft will be offering access to its online service with Windows 95.”

	“Only seven percent of U.S. households subscribe to an online service, so there is lots of room for many competitors in the online services business.  We believe the success of MSN and any other online service will be based on quality and variety of content, customer service, wide telecommunications access, price and other factors that are important to consumers.  We look forward to entering this competition,” said Siegelman.

	In addition to today’s MSN announcement, Microsoft also said that the Justice Department has requested information about a provision in Microsoft’s OEM license agreements for Windows 95, known as “12(d).”  The provision is intended to protect Microsoft, OEMs and end-users from patent infringement lawsuits.  Under 12(d), OEMs agree not to assert patent infringement claims against Microsoft, OEMs or end-users for distribution or use of Windows 95.  Although Microsoft has included the 12(d) language in various OEM license agreements since 1990, the provision has gained importance in recent years as patent infringement litigation in the software industry has increased.

	“This standard provision is designed to create an environment for Windows 95 users in which patent infringement litigation is minimized,” said Neukom.  “Microsoft and the OEMs that already have agreed to this provision believe it is in the best interest of consumers, because it lowers prices and allows everyone to focus on building better products without the distraction of costly and time-consuming patent infringement litigation.”

	Founded in 1975, Microsoft (NASDAQ "MSFT") is the worldwide leader in software for personal computers.  The company offers a wide range of products and services for business and personal use, each designed with the mission of making it easier and more enjoyable for people to take advantage of the full power of personal computing every day.
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