IBM is facing a possible Federal antitrust inquiry over allegations that it has monopolized the mainframe computer market, according to people who have been contacted by the Justice Department.
The Wall Street Journal and The New York Times reported Thursday that members of the Computer & Communications Industry Association, a group which includes such IBM rivals as Microsoft and Oracle among its members, have been contacted by the Justice Department seeking information related to IBMs mainframe business.
The action follows complaints by the industry association that IBM has attempted to stifle competition in the mainframe market and made it difficult for competitors to license IBM software. A small Florida-based mainframe reseller called T3 also filed an antitrust complaint against IBM earlier this year in Europe, alleging IBM was withholding patent licenses for its mainframe operating system and blocking access to certain intellectual property, effectively eliminating competition.
IBM has not yet responded to the reports, and according to The New York Times, the Justice Department has so far refused to comment. A phone call to the agency was not immediately returned.
The possible antitrust investigation may have significant ramifications for large enterprises around the world as many still rely on IBMs mainframes to run their core business applications and databases.
IBM has long held a near-monopoly in the mainframe market and has been able to defend that position with relatively little interference from federal regulators. The Justice Department attempted to pursue an antitrust case against IBM in the 1970s, but the suit was dropped by the Reagan administration after a lengthy investigation in 1982.
Analysts estimate IBM garners as much as one-quarter of its $104 billion in annual revenue from its mainframe business.
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