BUSINESS WEEK ONLINE / COURTTV ONLINE:  MICROSOFT ON TRIAL
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Profiles
 
 
FEB. 9, 1999
 
Just What Microsoft Needed: A Blunderless Day
One of its top Windows execs holds his own -- and doesn't create any openings for Justice

After last week's volley of self-inflicted wounds, Microsoft rebounded on Tuesday, Feb. 9, mounting a counterattack against government antitrust charges at the trial in Washington. The powerful software maker didn't score any touchdowns, but it didn't create any more problems for its defense -- as it did the previous week -- by having the credibility of its witnesses and its evidence called into question.

During the morning session, William Poole, senior director of business development for Windows at Microsoft, rebuffed the government's contention that some of the agreements Microsoft entered into with popular Web sites were exclusionary and unfairly hurt Microsoft competitors. Poole said these contracts with so-called Internet content providers (ICPs) helped promote Microsoft's browser on the same level as its competitors' and weren't meant to exclude rival browsers from the marketplace. Indeed, Poole said that while the agreements forced browser marketing parity, they didn't prevent the ICP from accepting advertising or other forms of promotion from rival browser manufacturers, such as Netscape Communications.

DEGRADED OR ENHANCED? Poole also tried to explain internal memos, introduced as government evidence, in which he wrote that Microsoft wanted to degrade the Web site when viewed with a non-Microsoft browser. Poole said the issue wasn't one of degradation but of "enhancement." He said the content and basic presentation of the Web site wouldn't change as a result of the browser used to view it. Rather, Microsoft's browser allowed for more viewing details. Poole forcefully contended that there was nothing wrong with this approach and that in the end the consumer benefited because Microsoft had developed a product that enhanced the Web.

After the noon recess, Microsoft presented another witness, Cameron Myhrvold, a company vice-president, who offered no groundbreaking evidence or revelations, but rather bolstered Microsoft's case that integrating its Internet Explorer browser into Windows 98 was good for the consumer and Microsoft's partners. Myhrvold said Microsoft-ISP contracts merely helped the software giant distribute its Web browser more widely, but in the final analysis, actual usage depends on the browser's merits. Myhrvold said if Internet Explorer gained market share that was because Microsoft offered a better product to the ISPs, not because the company strong-armed the ISP into promoting Internet Explorer.

Lead government lawyer David Boies disputed this claim as being too simplistic. He pressed Justice's case that Microsoft unfairly used its Windows monopoly to create another monopoly in the Web browser market. Boies is expected to continue with this line of attack tomorrow when Myhrvold takes the stand for a second day. But if Wednesday's sparring is anything like today's, don't expect any fireworks from either side.

By David G. McDonough Jr. in Washington

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1998-99


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