The Justice Department on Monday rejected most of the revisions Microsoft seeks in the government's breakup proposal because they would create "loopholes" for the software giant to continue anti-competitive practices.

However, the government accepted some minor changes in the wording of the proposed antitrust remedy. Microsoft (stock: MSFT) has until Wednesday to file its response to the government's comments. U.S. District Judge Thomas Penfield Jackson could rule on Microsoft's fate at anytime after that.

The Justice Department and 17 states want to break up Microsoft into an operating system company and applications company, and impose conduct restrictions to encourage competition. Microsoft has called the breakup plan "extreme and unjustified."

On Friday, Jackson extended the final comment period after government attorneys said some Microsoft revisions had some merit. Microsoft sought major changes in the timing of the government's breakup proposal in what was supposed to be the final word in the 78-day trial and battle of briefs.

The department refused Microsoft's 12-month timeframe over the government's proposed four-month timetable to outline its own breakup, but accepted Microsoft's term "divestiture" instead of "reorganization" to more accurately define the remedy.

The rest was brushed aside.

"Microsoft's other proposals consist largely of changes that would create loopholes and permit Microsoft to continue to engage in anti-competitive practices like those found by the court or otherwise to frustrate or undermine the purposes of the final judgment," the department said in its brief.

"Many of Microsoft's comments go beyond merely addressing the proposed form ... and make arguments about the merits that Microsoft has previously raised and that plaintiffs have addressed in their prior filings," the brief said.

Despite the extended legal maneuverings, Jackson wants the remedy process to be speedy and the government wants to keep the momentum going for an anticipated breakup, said William Kovacic, George Washington University law professor.

"By describing repeatedly how the breakup will happen, it almost gives some credibility to the idea," he said.

Microsoft was up 1 1/2 to 67 7/16 in afternoon trading.

AMD INTRODUCES NEW PROCESSOR
Advanced Micro Devices (NYSE:AMD) announced today the launching of their latest processor, the AMD Athlon processor with built-in cache memory, the fastest chip the company has produced to date. Full Story

TAIWAN PC MAKERS SIZE UP NEW INTEL CHIPSET
Intel unveiled an update to its 820 chipset Monday, promising improved performance and flexibility for the desktop market segment. Full Story

SEGA, MOTOROLA TO DEVELOP INTERNET CELL PHONES
Japan's Sega Enterprises Ltd. said Monday that it would develop Internet-capable cellular phones jointly with U.S.-based cellular phone giant Motorola Inc., Sega representatives told EFE. Full Story

IBM TARGETS SMALL BIZ WITH LOW-COST THINKPADS
IBM will introduce "the most affordable ThinkPads ever" Monday, fleshing out its popular notebook line with two models that target students, entrepreneurs, and small companies, an official said. Full Story

DRAM CHIPS SHORTAGE TO WORSEN IN Q3: DAEWOO SECURITIES
With personal computer manufacturers' high season arriving in the third quarter, shortages in DRAM chips are expected to get worse, to push 64 megabyte DRAM chip prices above US$8. Full Story

TYCO, CISCO SYSTEMS ACHIEVE RECORD UNDERSEA IP TRANSMISSION
Tyco Submarine Systems Ltd. Full Story

SATELLITE CRASHES INTO PACIFIC OCEAN
After nine productive years in orbit, a $670 million NASA satellite mission came to a fiery end early Sunday morning. The 33,000 pound (15,000 kilogram) Compton Gamma Ray Observatory (CGRO) fired its rocket engines one last time for 30 minutes as it passed Full Story

ANOTHER STRONG DAY FOR THE TECH SECTOR
It has been another strong day for the technology sector as Internet and chip stocks went on a tear. As a result, the tech heavy NASDAQ is up 201.50, or 5.6 %, to 3 784, adding to yesterday's 5.3 % move. Leaders include Sun Microsystems (SUNW) rising 5 1/16, Full Story