Some of yesterday's trial trascript:
microsoft.com
16 (VIDEO DEMONSTRATION PLAYED.)
17 "LET'S START OFF WITH A DEMONSTRATION ON
18 WINDOWS 98. LET'S OPEN UP "MY COMPUTER" ON
19 WINDOWS 98. THE FIRST THING THAT YOU WILL NOTICE
20 IS A RICH VIEW OF THE INFORMATION INSIDE OF IT.
21 IT TELLS ME THAT I'M IN "MY COMPUTER."
22 AS I CLICK ON THE HARD DISK, I SEE HELPFUL
23 INFORMATION ON THE LEFT TELLING ME HOW MUCH FREE
24 SPACE I HAVE ON MY DISK."
25 Q. NOW, THAT WAS A DEMONSTRATION INVOLVING WINDOWS 98;
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1 CORRECT, SIR?
2 A. THAT'S RIGHT.
3 Q. AND PART OF WHAT YOU WERE TRYING TO DO HERE IS SHOW
4 THE BENEFITS OF INTEGRATION OF IE TECHNOLOGIES INTO
5 WINDOWS 98; FAIR?
6 A. YES, DEMONSTRATING THE HTML RICHNESS YOU COULD HAVE
7 BEHIND ANY FOLDER, YES.
8 Q. IT WAS MORE THAN JUST DEMONSTRATING THE HTML
9 RICHNESS, WAS IT NOT, SIR? YOU WERE TRYING TO DEMONSTRATE
10 OR, AT LEAST, SUGGEST THAT THIS RICHNESS WAS SOMEHOW
11 CONNECTED TO THE INTEGRATION OF IE TECHNOLOGIES INTO
12 WINDOWS 98; CORRECT?
13 A. WELL, I--YES, BUT LET ME QUALIFY THAT SLIGHTLY
14 BECAUSE I BELIEVE THIS WAS IN A SECTION THAT IT WAS
15 COMPARING, IF YOU TAKE A WINDOWS 95 GOLD SYSTEM AND THEN
16 PLACE NAVIGATOR 406 ON IT, THAT YOU WOULDN'T GET SOME OF
17 THESE CAPABILITIES.
18 SO, IT WASN'T TRYING TO SAY THAT YOU COULDN'T DO
19 THIS WITH THE PIECE OF SOFTWARE FROM IE THAT WAS PROVIDED
20 TO--SEPARATELY OFF THE WEB. IN OTHER WORDS, YOU COULD GET
21 PIECES OF THIS SOFTWARE--PIECES OF WINDOWS, IF YOU
22 WILL--OFF THE WEB SEPARATE FROM WINDOWS 98. SO, I DON'T
23 KNOW IF THAT HELPS.
24 Q. YES. LET'S JUST EXPLORE THAT A LITTLE BIT.
25 WHAT YOU'RE SAYING IS IF YOU TOOK A WINDOWS 95
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1 MACHINE WITHOUT ANY INTEGRATED IE TECHNOLOGIES, AND YOU
2 ADDED A STAND-ALONE DOWNLOADED OFF OF THE WEB OR BOUGHT AT
3 RETAIL IE 4, YOU WOULD GET THE SAME RICH EXPERIENCE THAT
4 YOU SAY YOU GOT HERE; RIGHT, SIR?
5 A. YES, I BELIEVE THAT'S CORRECT.
6 Q. OKAY. NOW, LET'S GO TO THE NEXT ILLUSTRATION.
7 (VIDEO DEMONSTRATION PLAYED.)
8 "NOTICE THAT IF I ENTER MY HARD DISK, I CAN
9 NAVIGATE FORWARD AND BACKWARD JUST AS IF I WERE
10 NAVIGATING AROUND THE WORLD WIDE WEB."
11 Q. AND AGAIN, SIR, IF YOU TOOK A WINDOWS 95 MACHINE
12 WITHOUT ANY INTEGRATED BROWSING AND YOU ADDED A
13 STAND-ALONE IE 4 BROWSER TO IT, YOU WOULD BE ABLE TO DO
14 THE SAME THING; RIGHT?
15 A. YES, BUT I WOULDN'T USE THE SAME TERMS YOU'RE USING
16 BECAUSE IE IS JUST A PART OF WINDOWS. AND WHAT YOU'RE
17 SAYING WHEN YOU SAY "STAND-ALONE," WE'RE SHIPPING ALL
18 THESE WINDOWS COMPONENTS THERE. IT'S LIKE WE'VE GOT A
19 HUGE CHUNK OF WINDOWS THAT MAKES UP IE, SO THE FACT THAT
20 YOU CAN DO THIS, YOU KNOW, IS NOT SURPRISING AT ALL.
21 YOU'RE SHIPPING PART OF WINDOWS. THAT'S HOW YOU'RE DOING
22 IT, PROVIDED DOWN-LEVEL SUPPORT TO PEOPLE.
23 Q. LET'S SEE IF WE CAN EXPLAIN FOR THE RECORD EXACTLY
24 WHAT YOU'RE SAYING.
25 YOU DESCRIBED A WINDOWS 95 RETAIL VERSION OF A
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1 MACHINE ON THIS VIDEO, AND YOU SAID IT DIDN'T HAVE ANY
2 INTEGRATED WEB BROWSING; RIGHT?
3 A. ANY--YES.
4 Q. OKAY. NOW, IS IE 4 SOLD AT RETAIL, SIR?
5 (PAUSE.)
6 Q. THIS IS NOT A TRICK QUESTION.
7 A. I UNDERSTAND, BUT I GET CONFUSED BECAUSE I KNOW WHAT
8 WE'RE DOING IN THE FUTURE, AND I DON'T KNOW, I WOULD HAVE
9 TO THINK BACK.
10 I THINK IT IS, BUT I'M NOT A HUNDRED PERCENT.
11 Q. OKAY. NOW, YOU TAKE THIS IE 4 THAT'S SOLD AT RETAIL,
12 AND YOU LOAD IT INTO THE WINDOWS 95 RETAIL VERSION, TWO
13 THINGS THAT THE CUSTOMER HAS PURCHASED SEPARATELY AT
14 RETAIL, OKAY? WITH ME?
15 A. UMM-HMM.
16 Q. YOU HAVE TO SAY, SIR, YES OR NO.
17 A. YES.
18 Q. AND THAT COMBINATION OF THOSE TWO RETAIL PURCHASE
19 PRODUCTS WOULD DO EXACTLY WHAT YOU'RE DESCRIBING ON THIS
20 VIDEO; RIGHT?
21 A. THAT'S CORRECT. WE'RE TAKING TWO PIECES OF WINDOWS
22 AND PUTTING THEM TOGETHER.
23 Q. OKAY. LET'S GO TO THE NEXT.
24 (VIDEO DEMONSTRATION PLAYED.)
25 "AND AS I OPEN UP THE CONTROL PANEL ICON
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1 HERE, YOU WILL NOTICE I SEE ADDITIONAL RICH
2 INFORMATION ABOUT THE CONTROL PANEL TO THE LEFT
3 OF THE WINDOW. THIS TEACHES ME THAT I CAN USE
4 THE CONTROL PANEL TO PERSONALIZE MY COMPUTER. IF
5 I NEED HELP, I SEE TWO LINKS THAT TAKE ME OUT TO
6 THE WORLD WIDE WEB, SPECIFICALLY TO THE MICROSOFT
7 WEB SITE WHERE I CAN FIND CUSTOMER SUPPORT.
8 NOTICE WHEN I CLICK ON THE TECHNICAL-SUPPORT
9 LINK, I'M IMMEDIATELY CONNECTED TO THE MICROSOFT
10 TECHNICAL SUPPORT WEB SITE WITHIN THE SAME WINDOW
11 THAT I WAS PREVIOUSLY USING TO VIEW THE CONTROL
12 PANEL. YOU WILL NOTICE THAT THE TOOLBAR FOR MY
13 WINDOW AUTOMATICALLY CHANGES BECAUSE I'M NOW
14 BROWSING THE WEB. THE TOOLBAR NOW HAS BUTTONS
15 USEFUL FOR BROWSING THE WEB SUCH AS STOP AND
16 REFRESH.
17 WHEN I AM DONE VIEWING THIS INFORMATION I
18 NEED ON THE WEB SITE, I CAN NOW SIMPLY CLICK ON
19 THE BACK BUTTON AND, IN THE SAME WINDOW, RETURN
20 TO THE CONTROL-PANEL CONTENTS THAT I WAS
21 PREVIOUSLY VIEWING."
22 Q. AND AGAIN, SIR, IF SOMEBODY COMBINED THE RETAIL,
23 ORIGINAL RETAIL, VERSION OF WINDOWS 95 WITHOUT ANY BROWSER
24 AT ALL AND THE RETAIL VERSION OF IE 4, THEY WOULD GET THE
25 SAME RICH EXPERIENCE AS YOU DESCRIBE HERE; RIGHT?
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1 A. YES, BUT YOU DO UNDERSTAND THERE IS ONLY ONE WAY THIS
2 COULD HAPPEN, WHICH IS IF WE ARE REPLACING CORE OPERATING
3 SYSTEM FILES. THERE IS NO OTHER WAY YOU COULD DO THIS.
4 THAT'S WHAT WE WERE DEMONSTRATING IN THE NETSCAPE
5 APPROACH. THERE ISN'T ANY OTHER WAY. BUT YOUR ANSWER IS
6 YES.
7 Q. AND YOU CAN REPLACE WHAT YOU CALL THESE CORE
8 OPERATING SYSTEM FILES BY TAKING THIS RETAIL PRODUCT
9 THAT'S SOLD ON THE SHELVES CALLED "IE 4" AND LOADING IT IN
10 TO WINDOWS 95, AN ORIGINAL WINDOWS 95 VERSION THAT CAME
11 WITH NO BROWSER; RIGHT?
12 A. ANSWER TO YOUR LAST QUESTION IS YES, AND THE ANSWER
13 TO THE OTHER QUESTION IS YES. YOU COULD GET THAT SOFTWARE
14 ON THE WEB OR WHEREVER.
15 Q. LET ME GO TO THE NEXT ONE.
16 THE COURT: WHAT WILL WINDOWS 95 WITHOUT
17 THE--WHAT WILL IT DO? IS IT STILL FUNCTIONAL?
18 THE WITNESS: YOU TAKE WINDOWS 95, AND WHAT WE
19 DID IS WE ENDED UP REPLACING THIS SERIES OF CORE FILES IN
20 THE SYSTEM, CORE FUNCTIONALITY, AND THAT'S, YOU KNOW, FOR
21 THE PURPOSES OF OUR DISCUSSION, IE. AND I SAY FOR THE
22 PURPOSES OF THIS DISCUSSION BECAUSE THERE IS OTHER
23 FUNCTIONALITY WE DID THAT TO AS WELL, LIKE GRAPHICS. BUT
24 YOU TAKE THAT AND YOU ADD IT AND REPLACE PARTS OF
25 WINDOWS 95. IT BECOMES ALMOST WINDOWS 98.
From United States v. Microsoft, Case Nos. 97-5343, 98-5012 (D.C. Cir. June 23, 1998).
We think it quite possible, however, to find a construction
of s IV(E)(i) that is consistent with the antitrust laws and
accomplishes the parties' evident desires on entering the
decree. The Department and DG IV were concerned with
the alleged anticompetitive effects of tie-ins. Microsoft's goal
was to preserve its freedom to design products that consum-
ers would like. Antitrust scholars have long recognized the
undesirability of having courts oversee product design, and
any dampening of technological innovation would be at cross-
purposes with antitrust law. Thus, a simple way to harmon-
ize the parties' desires is to read the integration proviso of
s IV(E)(i) as permitting any genuine technological inte-
gration, regardless of whether elements of the integrated
package are marketed separately.
This reading requires us, of course, to give substantive
content to the concept of integration. We think that an
"integrated product" is most reasonably understood as a
product that combines functionalities (which may also be
marketed separately and operated together) in a way that
offers advantages unavailable if the functionalities are bought
separately and combined by the purchaser.
The point of the test is twofold and may be illustrated by
its application to the paradigm case of the Novell complaint
and the subsequent release of Windows 95. First, "inte-
gration" suggests a degree of unity, something beyond merely
placing disks in the same box. If an OEM or end user
(referred to generally as "the purchaser") could buy separate
products and combine them himself to produce the "integrat-
ed product," then the integration looks like a sham. If
Microsoft had simply placed the disks for Windows 3.11 and
MS-DOS in one package and covered it with a single license
agreement, it would have offered purchasers nothing they
could not get by buying the separate products and combining
them on their own.11
Windows 95, by contrast, unites the two functionalities in a
way that purchasers could not; it is not simply a graphical
user interface running on top of MS-DOS. Windows 95 is
integrated in the sense that the two functionalities--DOS and
graphical interface--do not exist separately: the code that is
required to produce one also produces the other. Of course
one can imagine that code being sold on two different disks,
one containing all the code necessary for an operating system,
the other with all the code necessary for a graphical interface.
But as the code in the two would largely overlap, it would be
odd to speak of either containing a discrete functionality.
Rather, each would represent a disabled version of Windows
95. The customer could then "repair" each by installing them
both on a single computer, but in such a case it would not be
meaningful to speak of the customer "combining" two prod-
ucts. Windows 95 is an example of what Professor Areeda
calls "physical or technological interlinkage that the customer
cannot perform." X Areeda, Antitrust Law s 1746b at 227,
228 (1996).
So the combination offered by the manufacturer must be
different from what the purchaser could create from the
separate products on his own. The second point is that it
must also be better in some respect; there should be some
technological value to integration. Manufacturers can stick
products together in ways that purchasers cannot without the
link serving any purpose but an anticompetitive one. The
concept of integration should exclude a case where the manu-
facturer has done nothing more than to metaphorically "bolt"
two products together, as would be true if Windows 95 were
artificially rigged to crash if IEXPLORE.EXE were deleted.
Cf. ILC Peripherals Leasing Corp. v. International Business
Machines Corp., 448 F. Supp. 228, 233 (N.D. Cal. 1978) ("If
IBM had simply bolted a disk pack or data module into a
drive and sold the two items as a unit for a single price, the
'aggregation' would clearly have been an illegal tying ar-
rangement.") aff'd per curiam sub nom. Memorex Corp. v.
International Business Machines Corp., 636 F.2d 1188 (9th
Cir. 1980); X Areeda, Antitrust Law p 1746 at 227 (discussing
literal bolting). Thus if there is no suggestion that the
product is superior to the purchaser's combination in some
respect, it cannot be deemed integrated.12
So, does Allchin's testimony meet the test? |
