WRS on Microsoft "enemies list" disclosed in Fed trail
U.S. Says Microsoft Compiled
'Enemies List' of Its Rivals
By JOHN R. WILKE and KEITH PERINE
Staff Reporters of THE WALL STREET JOURNAL
WASHINGTON -- New documents released in the final days of the Microsoft Corp. antitrust trial show that the company drew up an "enemies list" of small software makers and that Chairman Bill Gates discussed the best way to leak a favorable e-mail message to the press.
Independent software makers were listed as "friends," "enemies" or "neutral," and should be treated accordingly, said a Microsoft e-mail offered as evidence. It added that an "initial blacklist" should consist of "hostile" firms and those firms working on technologies that "Microsoft does not like to see flourishing." A second memo has Mr. Gates telling a public-relations executive how to leak an e-mail that he wrote this past December.
A Leaked Document
The e-mail detailed Mr. Gates's view that America Online Inc.'s $10 billion purchase of Netscape Communications Corp. would hurt the government's case against Microsoft. After leaking the document to the Associated Press, a PR person reported back to Mr. Gates that the tactic was effective "as a press release," and added, "if we give it to everyone, it looks cooked and no one will cover it."
The exchange was more than simply embarrassing. Last week, Microsoft's lawyers had tried to introduce the Gates e-mail on AOL into evidence, telling the judge that it had just been found in America Online's files and was marked "highly confidential." In a motion Wednesday that included the subsequent e-mails to the PR person, the government suggested the court had been misled by Microsoft, because the Gates e-mail on AOL wasn't confidential and was self-serving.
The "enemies list" memo was cited during cross-examination of Microsoft's next-to-last witness in the case, Gordon Eubanks, former chief executive officer of Symantec Corp. The list surfaced in a pending private lawsuit brought against Microsoft by Bristol Technology Inc. and it isn't clear whether it will carry any weight in the U.S. case.
The list focuses on Microsoft's rivals in a narrow market segment. For example, it listed Wind River Systems Inc. as an enemy, because it was outselling Microsoft in a small but strategically crucial market for operating-system software for non-PC devices. In the list, a Microsoft manager weighs whether licensing restrictions for the company's Windows NT source code should be waived for 13 smaller software firms.
'A Little Niche Product'
Tom Burt, a Microsoft lawyer, said the e-mail concerned "a little niche product" and a spokesman said some of the "enemies" in the e-mail were subsequently granted the waiver. The list "does not reflect the company's policy," was written by a new employee, and ultimately wasn't implemented, the spokesman said.
Earlier, Mr. Eubanks testified that software developers are now more focused on writing programs for the Internet than for the Windows operating system, suggesting its dominance of the industry is fading.
But Mr. Eubanks wasn't warning of Microsoft's demise. He was called to the stand to tell the court that Microsoft faces myriad threats, and that the industry is healthy and highly competitive.
"The platform of choice for developers is shifting" from the desktop operating system to Internet browsers, Mr. Eubanks said.
That is the point, the government argues in its case, because Microsoft is on its way to dominating Internet software as well. In its lawsuit, the government alleged Microsoft illegally protected its Windows monopoly, then tried to use it to wrest control over Internet-access software.
Mr. Eubanks also cited Linux, a rival operating system, as a threat. "To discount Linux would be like discounting Windows in 1995," he testified. He did concede that Microsoft had a "monopoly," but said he was using the term as an "amateur," not a lawyer, and that having a single standard helped consumers.
On cross-examination, a government lawyer charged that Mr. Eubanks "made a conscious effort to avoid competing with Microsoft because you were afraid they'd step on you."
"Absolutely not true," Mr. Eubanks responded angrily from the stand. "That is absolutely not true!" |
