BRIAN NELSON, CNN ANCHOR: Microsoft could send a shudder through financial markets as shares begin trading on Monday. Talks between Microsoft, the U.S. government, and 19 states failed to resolve the pending antitrust case against the software giant. CNN's Bruce Francis has the outlook.</s>BRUCE FRANCIS, CNN CORRESPONDENT (voice-over): Microsoft executive held a rare Sunday conference call with analysts in an attempt to spin Wall Street's reaction to the collapse of settlement talks. Unlike most calls, this one was closed to the media. Talks broke off this weekend as the court appointed mediator, Judge Richard Posner, concluded that the two sides were just too far apart.</s>SANJIV HINGORANI, SOFTWARE ANALYST, BROWN BROTHERS HARRIMAN: I think Microsoft has done what Microsoft needed to do, which was to try and seek and get a possible settlement, but not without giving up its right of doing it.</s>FRANCIS: Some analysts expect that the stock could drop about $5-$7 a share on the news, slashing $25-$35 billion of market capitalization in the process. Microsoft stock has been buffeted recently by the changing prospects for a settlement. And over the past year, while the Nasdaq has practically doubled, Microsoft shares have been held to a gain of about 15 percent. That pall of uncertainty is likely to continue for months. The next step in the case is Judge Jackson's conclusions of law, likely a disaster for Microsoft based on the judge's earlier finding that the company is a monopoly. Then remedy proceedings could drag on for several months if a judge hears arguments about what the penalty should be. Only after that can Microsoft can appeal. (on camera): And that's where the company has had the best luck in the past. Judge Jackson has already been overturned twice on Microsoft. Bruce Francis, CNN Financial News, New York.
Breakdown of Antitrust Settlement Talks Between Microsoft and Government May Hit Markets Hard