It's a new year, but the testimony that kicked off the Microsoft antitrust trial's resumption echoed what the court heard in the weeks before the holiday recess: reports of how Microsoft used its operating system monopoly to bully other companies into doing its bidding. The case in point on Jan. 4 was how Intuit Inc., which makes the popular Quicken personal finance software for consumers, tried to negotiate a distribution deal with Microsoft. President and CEO William Harris said Intuit sought a deal in 1997 that would place an icon for its Web site on Microsoft's Active Desktop -- a coveted position in Windows that would bring traffic to Intuit.

The negotiations got hung up, Harris said, because Microsoft wanted Intuit to stop promoting Netscape Communication Corp.'s rival browser and stop distributing Intuit's content through Netscape's browser. In the end, Intuit made the deal with Microsoft, in part because it feared that the software giant would might harm it by using Windows to promote Money, its own personal-finance software and No. 2 to Quicken.

But John L. Warden, Microsoft's attorney, ripped into Harris, producing a sheaf of E-mails that indicated Intuit decided to forgo a relationship with Netscape because the company could not offer a custom browser such as Intuit wanted to use to distribute Quicken. Such a system would enable Quicken users to get information from the Internet without leaving the Quicken application. But Microsoft was willing to provide such a browser.

ON-TIME DELIVERY. Warden offered one internal E-mail from Intuit's head of engineering from November, 1996, that suggested he initiated the contacts with Microsoft. Harris conceded that Microsoft was willing to complete its customized browser for Intuit in time for release of Quicken 98 while Netscape was unable to promise on-time delivery and was having trouble meeting, as another Intuit E-mail put it, Intuit's "drop dead requirements." Harris indicated that Intuit would have preferred to work with Netscape because Microsoft was a competitor.

Warden also scored some points by noting that placement on the Active Desktop was not as crucial as Intuit believed it was. For one thing, Microsoft eventually dropped the requirement that computer makers carry the "channel bar" in which the icons were located because it wasn't popular. Also, Warden noted, Intuit entered into exclusive deals with America Online, CNNfn, and Packard Bell to distribute Quicken technology, and Harris conceded that the AOL deal was more successful than its agreement with Microsoft was -- meaning that the deal with Microsoft was not as critical to Intuit's success as Harris earlier had indicated.

Harris' testimony -- and Warden's cross-examination -- echoed earlier testimony from an AOL executive that the online service provider agreed not to promote the Netscape browser in return for coveted space on the Windows desktop. Then, also, Microsoft argued that AOL chose to distribute content with Microsoft's browser because of its componentized system.

Microsoft didn't score all the points, though. Harris testified that pressure from Microsoft led Compaq Computer to break a contract with Intuit to exclusively bundle Quicken into Compaq's personal computers. "Compaq wanted to abrogate [the contract] to secure a more favorable relationship with Microsoft," Harris said. Compaq wanted the right to bundle both Quicken and Microsoft's Money. He said Intuit's CEO at the time complained to Compaq, but "Compaq told us that this was the way things were."

Microsoft will finish its cross-examination of Harris during the morning of Tuesday, Jan. 5, and the Justice Dept. will do its redirect questioning in the afternoon. Justice's last witness, Franklin Fisher, economics professor at the Massachusetts Institute of Technology, may take the stand during the afternoon.

By Susan Garland in Washington