The hearing before the Senate Judiciary Committee today is titled "Market Power and Structural Change in the Software Industry," but it's really about the business practices of one company: Microsoft Corp.

On one side are billionaires Bill Gates of Microsoft and Michael Dell of Dell Computer Corp. On the other are Scott McNealy of Sun Microsystems Inc. and James Barksdale of Netscape Communications Corp., two Silicon Valley competitors who've made no secret of their displeasure with the way Gates does business.

Called by committee Chairman Orrin G. Hatch (R-Utah), a frequent critic of Microsoft, the hearing is part of a longer-term effort by Hatch to examine whether existing antitrust laws, written in the age of railroad and petroleum monopolies, are suited to the fast-changing, economically different world of software.

In the more immediate future, some legal specialists say the inquiry could send important signals to the Justice Department, which has filed a lawsuit over Microsoft's tactics in the Internet browser market and is actively collecting evidence that could lead to a broader antitrust action under the Sherman Act.

By voicing public skepticism of Microsoft, Hatch, whose committee oversees Justice, can urge the department to pursue a vigorous antitrust investigation. At the same time, by holding public hearings, Hatch and other senators can indicate to the department that there is political support for what would be a highly controversial case, the experts said.

"It has both possibilities," said William E. Kovacic, a law professor at George Mason University and a former Federal Trade Commission attorney. "No antitrust agency can afford to outrun a political consensus, and to the extent that this kind of hearing signals the willingness of Congress to accept further inquiry into the software industry, that's an important signal for the Justice Department."

The Senate has a long history of encouraging Justice antitrust investigations. In the 1960s and '70s, several senators, chief among them Philip A. Hart, a Michigan Democrat for whom the building housing today's hearing is named, laid the groundwork for FTC and Justice cases against AT&T Corp., Xerox Corp. and the breakfast cereal industry.

But other legal specialists contend that congressional inquiries will have little impact on Justice's case. "I don't think they're going to drop a lawsuit in court because there's congressional pressure," said Mark C. Schechter, a former Justice Department official who now works at the Washington law firm of Howrey & Simon.

Hatch maintains that his committee has a role in examining issues of competition in the software industry. "I don't think {Joel I. Klein, Justice Department antitrust division chief} should be the only person in Washington who is thinking about these very significant issues," Hatch said in an interview. "There have been significant allegations and complaints made to us and it's our responsibility to look at this."

A large Microsoft competitor, computer networking specialist Novell Inc., is located in Hatch's home state of Utah, but the senator said that's not what piqued his interest in software competition. "Most of the complaints have come from California and the Judiciary Committee should be responsive to concerns from all over the country," he said.

Among those raising complaints have been Sun and Netscape, who charge that Microsoft is using its dominance of personal computer desktops -- the company's Windows 95 operating system is installed on more than 90 percent of new PCs -- to get an unfair leg up in other markets, including those for Internet browsers.

"We think, left unchecked, Microsoft has a monopoly position that they could use to leverage their way into banking, newspapers, cable and broadcasting, Internet service providers, applications, databases, browsers. You name it," Sun CEO McNealy said yesterday. "When you have a monopolist in the food chain, they absolutely have Pac Man capabilities."

Gates bluntly disputed the "monopolist" characterization in a breakfast with Washington Post editors and reporters yesterday, saying his company is only providing what its customers ask for and isn't raising prices or constricting supply like a traditional monopolist {Details, Page A1}.

The browser issue has been championed by the Justice Department, which filed suit last fall over a Microsoft requirement that PC makers distribute Microsoft's Internet browser as a condition of licensing Windows 95, saying that the practice violated a 1995 consent decree with the government.

Although Microsoft argued that the browser and the operating system were integrated and therefore not covered by the decree, a federal judge issued a preliminary injunction in December preventing the joint distribution. Microsoft has appealed the injunction, but in the interim, the company has signed a settlement agreement with Justice that lets PC makers block users' access to the browser.

Sources familiar with the Justice Department's case say the government no longer sees the consent decree case as a top priority and instead is focusing most of its efforts on assembling a broader antitrust case against the software giant.

The department believes the settlement, which remains in effect for 90 days after the appeals court issues a ruling, likely will last until Windows 95 is replaced by a new version. The new product, Windows 98, is the focus of the current investigation, the sources said.

Suggestions of a broader Justice case drew support from Microsoft's opponents yesterday. "I do think that there is a bigger issue beyond the current instance of the specific violation of the consent decree that Microsoft signed," Barksdale said at a news conference.

Gates, however, said yesterday that Microsoft is moving "full speed ahead" toward its release of Windows 98 by midyear, as scheduled.

The department yesterday filed a scheduled legal brief with the U.S. Court of Appeals in Washington asserting that Microsoft "broke {a} promise" with the government by requiring the distribution of its browser. The department yesterday also picked up the support of 27 states, which filed a friend-of-the-court brief backing Justice's case.

"Microsoft is stifling competition in clear violation of the law and plainly contrary to consumer interests," Connecticut Attorney General Richard Blumenthal said in a statement. Eleven state attorneys general have said they are conducting their own investigation of Microsoft's business practices.

Gates, Barksdale and McNealy spent much of the day meeting with senators on the committee. Barksdale and McNealy said they urged committee members to support the Justice investigation but shy away from proposing new laws. Hatch, in a speech last month, warned that if one company dominates commerce and content on the Internet, it could lead to calls for an "Internet Commerce Commission."

"We're worried if you don't enforce, we will end up with regulations," McNealy said. "That can be a disaster for everyone." CAPTION: During Senate hearings today, Microsoft Chairman Bill Gates, left, and Dell Computer chief executive Michael Dell will square off against . . . CAPTION: . . . Scott McNealy of Sun Microsystems, left, and James Barksdale of Netscape Communications, critics of Microsoft's business practices.