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To: Harvey Allen who wrote (22414)	1/14/1999 3:55:00 PM
From: MoneyMade	Respond to of 24154

CYTL

To: Harvey Allen who wrote (22414)	1/15/1999 3:41:00 PM
From: Daniel Schuh	Read Replies (4) \| Respond to of 24154

Microsoft Witness Attacked for Contradictory Opinions nytimes.com It's so unfair! Anybody who's read this group for a while knows that Microsoft advocates are never, ever, restrained by that notorious hobgoblin of small minds. This is the Times' take on Schmalensee testimony. As I expected, it sounds a lot better when you get to pick a little bit out of the written deposition, Reggie style. A Justice Department lawyer produced several prominent academic papers Thursday that he said showed that the Microsoft Corporation's first witness in its antitrust trial had written opinions contradicting views he has offered in expert testimony for the software giant. In a broad attack on the witness, Richard L. Schmalensee, an economist at the Massachusetts Institute of Technology, David Boies, the Government's lead trial lawyer, produced evidence that a survey cited by Schmalensee in his testimony actually appeared to be a publicity tool ginned up by Microsoft's chairman, William H. Gates. In Schmalensee's direct testimony, he wrote that in a recent survey of software developers, "85 percent predicted that Microsoft's integration of Internet functions into Windows would help their company, and 83 percent predicted it would help consumers." He cited the figures to support his own advocacy of those positions. "Did you ever look at that survey, find out what its purpose was?" Boies asked. When Schmalensee said he had not, Boies asked, "Did anyone ever tell you that the purpose was to give Gates helpful information to use at a Senate hearing" early last year? Then Boies produced an e-mail message in which Gates wrote last February, "It would HELP ME IMMENSELY to have a survey showing that 90 percent of developers believe that putting the browser into the operating system makes sense," adding, "Ideally we would have a survey before I appear at the Senate on March 3rd." In a subsequent string of e-mail messages, Microsoft employees laid out how they would pose the questions to get the responses Gates wanted. Schmalensee said that had he known the origin of the polling information, he would have cited the figures in his testimony anyway, though he might have added "an explanatory phrase." Schmalensee should be happy he's not one of the many Microsoft "relatively junior executives" up next, with somewhat more proximate email trails to cover up. Enquirer headline next week: MASSIVE PREMATURE SENILITY EPIDEMIC STRIKES REDMOND! Nobody can remember a thing! Or maybe it'll just be situational amnesia. Schmalensee acknowledged under questioning that no competitor to Microsoft had ever met that test. Still, he argued, Microsoft had behaved and spent research and development money as if it did face competitive threats, particularly from the International Business Machines Corporation, which introduced the unsuccessful OS/2 operating system almost 10 years ago. That, he suggested, put pressure on Microsoft's profits, meeting one of his tests. "I discussed this with Gates," he said. "He told me about the time when cooperation between Microsoft and I.B.M. ended; I.B.M. said effectively: 'We will bury you.' He took that threat very seriously." Schmalensee said that Microsoft had spent money on research to counter that threat. But when pressed, he acknowledged that he really had no direct knowledge of that and was only presuming it to be the case. Bill forgot to tell him that part. Bill forgets a lot of things, and I'm sure his "relatively junior executives" will too.