More bad news for Microsoft. Company Vice-President Brad Chase followed the lead of fellow Microsoft execs on Feb. 11 with admissions that inadvertently could help the government. At issue was whether Microsoft acted illegally in trying to dominate the Internet browser market by using its leverage in other areas to crush competitors like Netscape Communications Corp.

Chase was in good company. Nearly all of the company's previous witnesses at the trial in Washington have made admissions that may help prosecutors in proving the antitrust violations that the federal government and 19 states have brought against Microsoft.

Chase took the stand to bolster Microsoft's contention that consumers can easily download Web browsing software from the Internet. Microsoft argues that it can't monopolize the browser market because the consumer can always turn to the Internet and get a rival browser with relative ease. Thus, the company contends, Internet software will be successful only if the consumer believes it to have the most merit.

During cross-examination, however, government lawyer David Boies cast serious doubts on this claim. Boies produced various internal Microsoft documents, some written by Chase, showing that during the development of the company's Internet Explorer Web browser, Microsoft employees had serious reservations on the ability and ease of distributing software on the Internet.

FASTER THAN THE STORE. And once again, videotaped evidence submitted by the software giant proved to be damaging. Boies began his attack on the ease of downloading by questioning the reliability of a video Microsoft showed of a company employee downloading a rival browser, Netscape Navigator. The download took about 10 minutes on the tape. But Boies got Chase to admit that this speed was artificially quick because it was done over a very fast corporate Internet access line, and that no home user would likely be able to obtain these speeds. Chase conceded it could take the average user up to 50 minutes to download the browser. But he insisted that the difference between 10 minutes and 50 minutes isn't important because it's faster than traditional methods. "It takes a little bit of time, but not a lot. It's quicker than going to the store," Chase testified.

Boies also confronted Chase with internal Microsoft documents that contradicted his sworn testimony. For example, the Justice lawyer presented Chase with a March, 1997, memo written by another Microsoft employee that said "almost 60% of all surfers have never downloaded any software from the Web. My sense is that these people are not very likely to download anything, let alone a browser that takes 2 hours to download, from the Web."

Boies also asked Chase to explain the March, 1998, deposition of Joe Belfiore, a Microsoft computer programmer, who testified that "there's tons of feedback that suggest downloading IE (Internet Explorer) takes too long, is too hard.... The number of hours it takes to download these components over a phone line is incredibly discouraging to people, often fails, and the result is that people don't get an improved user experience at all."

CRITICAL CULTURE. Chase insisted that these documents don't contradict one of the pillars of Microsoft's defense -- that Internet downloading will keep the Web browser market very competitive. He said the documents must be put into the proper context: What the Microsoft employees meant was that the company must double its efforts to make downloading easier and faster, rather than abandoning the technique altogether. He said Microsoft's culture was to be overly critical and extreme in trying to improve products.

Later in the afternoon session Boies questioned Chase on a deal Microsoft and America Online signed that made Internet Explorer AOL's primary Web browser. The government contends that Microsoft unfairly brokered this deal by using its Windows operating system monopoly to entice AOL into choosing Explorer over Navigator. Boies again inflicted damage when he asked Chase to explain a memo from an AOL executive who wrote that Microsoft Chairman Bill Gates offered AOL money in order to seal the deal and hurt Netscape. The AOL executive wrote: "Gates delivered a characteristically blunt query: How much do we need to pay you to screw Netscape?" Chase said he never recalls Gates saying this and that the AOL-Microsoft deal was based solely on the technical merits of Explorer and Microsoft. He said his company offered AOL a better product, and that's the only reason Explorer was chosen.

Finally, Boies zeroed in on whether Microsoft, in crafting this deal with AOL, effectively prevented AOL customers from using Navigator. Boies got Chase to admit that the contract allowed AOL to offer Navigator but did not allow AOL to promote it in any meaningful way. Boies also presented a set of talking points that Chase wrote in March, 1996, where Microsoft exec said the chances of an AOL customer using Navigator are "pretty remote."

All in all, not a good way for Microsoft to end the week, especially since this is supposed to be the company's time to prove why the government's allegations are false and baseless. Instead, Microsoft was playing defense -- and may have once again lost more ground than it won.

By David G. McDonough and Mica Schneider in Washington