Judge lifts last of IBM consent decree

A federal judge has approved a settlement between the US Justice Department and IBM who reached an agreement that terminates the remainder of an antitrust consent decree that had affected Big Blue's sales and service operations since the Eisenhower administration.

A federal judge has approved a settlement between the US Justice Department and IBM who reached an agreement that terminates the remainder of an antitrust consent decree that had affected Big Blue's sales and service operations since the Eisenhower administration.

The ruling, issued Wednesday in New York by U.S. District Judge Thomas P. Griesa, affirms an agreement reached by IBM and Justice Department officials in July 1996.

The 1956 antitrust consent decree was initially aimed at limiting IBM's monopoly in the punch-card computer business.

In his ruling, Griesa noted that a more competitive market makes it possible for IBM to be treated like any other computer manufacturer.

The settlement approved by Griesa will phase out restrictions on IBM's AS/400 line over the next four years and on its S/390 line over the next five years.

"The judge approving the agreement is terrific, but not unexpected," said Melinda McMullen, a spokeswoman for IBM.

The consent decree had made it "burdensome" for IBM to perform certain services, but the judge's ruling will change several business practices for IBM, McMullen said.

IBM will no longer be bound by rules of sequential delivery, meaning it can begin filling customer orders according to urgency rather than in the order they are received as previously required.

IBM will also be allowed to buy used AS/400 machines without restrictions. Previously, IBM could only acquire them as trade-ins for an upgrade or as credit for an outstanding bill, McMullen said.

At least one organisation remains opposed to the ruling. Independent Service Network International (ISNI), an association of independent computer maintainers, plans to recommend an appeal of Judge Griesa's ruling.

ISNI's position is that IBM maintains a dominant share of the mainframe computer market, and should remain under close scrutiny, association attorney Ronald Katz said in a statement.

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