Business round up

• Computer giant Microsoft was this week ordered to split into two by US judge Thomas Penfield Jackson. Bill Gates’s software empire was found to be in breach of monopoly laws and ordered by the federal judge to divide into two sections – one operating systems business managing Windows and an applications business managing its Office business software. Jackson’s ruling starts the break-up process straight away, forcing Microsoft to produce a break-up plan within four months. Other restrictions will come into effect immediately, which the company fears will damage its day-to-day operations. Microsoft has fought provisions obliging it to distribute secret software codes to the industry. CEO Steve Ballmer vowed to fight the decision by fast-tracking the case to the Supreme Court. Independent

BT incentive scheme could bring criticism

• Up to 3,000 BT directors and managers could be eligible for bonuses worth up to four-and-a-half times their salaries if an incentive scheme is approved next month. But the new share-based plan – which offers BT’s executive directors, senior executive team members and 2,500 management professionals shares worth 200 per cent of their salary – could attract criticism because of the size of the awards. BT’s CEO Peter Bonfield could reportedly net £10.5m over a three-year period. Hundreds of managers could earn close to £1m each over the same period. BT is also introducing retention shares worth 100 per cent of salary for staff with critical skills. The annual bonus worth 100 per cent of salary and the deferred bonus scheme which pays out 50 per cent of salary will continue. This means executives qualified for incentive, retention, bonus and deferred bonus could receive the equivalent of five-and-a-half times their salaries. Independent

Airline deal hits turbulence in fight for power

• British Airways’ bid to merge with Dutch airline KLM hit difficulties this week as the companies fought for influence in the new group. KLM reportedly wants 30 per cent for its shareholders but it is thought BA will offer less. If BA succeeds in linking up with KLM it will create the world’s third largest airline. Financial Times

Comments are closed.