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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Bearded One who wrote (12576)	11/25/1998 12:21:00 AM
From: ToySoldier	Read Replies (1) \| Respond to of 74651

Looks like MSFT lawyers are grasping for straws in the DOJ case. They are desperately trying to use any excuse to throw the case out. If this is MSFT's closing arguments (NSCP and AOL merged so throw out the case), then get ready to lose MSFT. The lawyers havent got an idea of the point of the DOJ case! (from PCweek on-line) Microsoft, citing AOL and Netscape, will seek dismissal of case By Lisa M. Bowman, ZDNN November 24, 1998 3:10 PM ET WASHINGTON -- The $4.2 billion deal involving America Online Inc., Netscape Communications Corp. and Sun Microsystems Inc. was again the focus of the players in the ongoing Microsoft Corp. antitrust trial Tuesday, as each side tried to spin the event in its favor. Lead U.S. Department of Justice attorney David Boies again said the alliance indicated Microsoft's stronghold on the market. "I think there's a lot of evidence what you see here is simply an exit strategy for Netscape," he said, "because of the blanket Microsoft put over it." Boies said yesterday that the deal could highlight Microsoft's monopoly power if AOL continued to bundle Microsoft's Internet Explorer browser even though it owns Netscape's browser. But he doubted the deal would affect the current trial. "I don't think it will have a significant effect on the case, either at the liability stage or at the remedy stage," he said. At this point, Boies said, he's still seeking to force Microsoft (MSFT) to include an alternative, comparable browser -- be it from Netscape, Sun, AOL or others -- on the desktop. "I don't think the remedy was Netscape-centric," he said. Boies would not comment on further remedies, such as a restructuring. Microsoft, not surprisingly, pointed to the alliance as further evidence of vigorous competition in the industry. "These people aren't running scared, they're running hard against Microsoft," Microsoft attorney John Warden said of Netscape, AOL and Sun. Warden also said Microsoft would seek dismissal of the case after the government offers all its evidence. Microsoft general counsel Bill Neukom said the deal bolstered his company's repeated assertions that the case should be thrown out. "The industries and consumers in an active marketplace with free and vigorous competition can do a better job than the government can ever hope to do," Neukom said. "The government ought to drop this case. It ought to stop wasting taxpayer dollars." The issue of the deal surfaced only briefly in the courtroom, when Microsoft attorney Michael Lacovara questioned government witness and former DOJ economist Frederick Warren-Boulton's assertion that Netscape was moving away from the browser market because it lacked the resources to compete against Microsoft. "You don't think there's any resource limitations on Sun as a practical matter?" Lacovara asked, referring to Sun's plans to license the browser. Warren-Boulton said he couldn't comment as an expert on events of the past couple days, to which Lacovara replied: "In software, we don't live in the world of yesterday or the day before. We live in the world of today." At that point Judge Thomas Penfield Jackson piped in to ask if Lacovara's questions were premised on known facts. Lacovara said they were, adding that he read this morning that Sun would be paying Netscape for the use of its browser. The Sun deal, which is separate from the AOL/Netscape merger, calls for AOL to buy $500 million worth of Sun's hardware and services through the year 2002. Sun agreed to pay AOL $350 million in licensing, marketing and advertising fees, plus minimum revenue commitments during the next three years. Lacovara continued questioning Warren-Boulton about the deal, but the economist hesitated. "I'm extremely reluctant to provide you with an expert opinion," Warren-Boulton said. In other questioning, Lacovara drew comparisons between Netscape's dominance in the browser market and Microsoft's dominance in the OS market. He asked Warren-Boulton whether Netscape should have been allowed to add features to its browser, since he's arguing that Microsoft should have to unbundle IE from Windows. Warren-Boulten repeated assertions that monopolists have to play by different rules. Lacovara also asked Warren-Boulton whether Microsoft's evangelizing to software developers -- in an attempt to get them to produce widely available, compatible software -- was bad for the industry. Warren-Boulton replied that it was "a mixed blessing, because on one hand you are making the Windows operating system more valuable, on the other hand you're creating a barrier to entry" for other operating systems. Toy