Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Sir Francis Drake who wrote (23568)	6/3/1999 2:06:00 AM
From: Sir Francis Drake	Read Replies (2) \| Respond to of 74651

I hope MSFT gets its act together when it comes to a competent defense. Here we go again: nytimes.com <<WASHINGTON -- The Microsoft Corporation once again tried to show in court Wednesday that the company was beset by potentially lethal competition, even presenting as evidence an e-mail message from one of its employees who called the competitive situation "a very scary thing." But as a Microsoft lawyer, Michael Lacovara, tried to make the case that the personal computer business was seriously threatened, he first had to get past comments Microsoft's chairman, William H. Gates, made in an interview published by Newsweek magazine last month. "Predicting the imminent demise of the personal computer has become an annual ritual," Gates said. "Well over 100 million PC's will be sold this year. That means the world now buys almost as many PC's as color TV's." Franklin M. Fisher, the Government witness facing cross-examination from Lacovara today, raised the issue of Gates's remarks when the lawyer tried to suggest that the operating systems in Sony's new Play Station toy or in the Palm Pilot personal organizer could pose a threat to Microsoft's industry-dominating Windows. Lacovara, of the Sullivan and Cromwell law firm, dismissed Gates's observation, asking , "Isn't that exactly what you'd expect Gates to say publicly, given the nature of Microsoft's business?" In preparation for the rebuttal phase of the trial now under way, Microsoft subpoenaed thousands of documents from America Online, Sun Microsystems and the Netscape Communications Corporation about the online service's purchase of Netscape and Sun's cooperative role in the new venture. Lacovara has not hidden Microsoft's excitement about what it found in those documents, and he entered a few into evidence today to support his assertion that Microsoft faces competitive threats. One document, prepared last November by Goldman, Sachs & Company, the investment banking firm that managed the Netscape acquisition for America Online, lays out what Goldman took to be "The Strategic Rationale: The Plan." The first point in the plan said the company could extend Netscape "to be a more comprehensive desktop application, bundling communications and productivity applications to absorb more share of computing time, with the goal of becoming the user's de facto environment." Lacovara also entered into evidence an e-mail message from last July describing a meeting between Sun and America Online executives. In the message, a Sun executive said America Online planned to begin using a new browser on its service based on Java, Sun's programming language. This, the Sun executive wrote, will "break the deadly embrace with Microsoft." America Online, the world's largest Internet service provider, with some 17 million subscribers, has distributed Microsoft's Internet Explorer Web browser with its software since 1997. Today's courtroom maneuvers were intended to persuade the judge that Microsoft faces competitive threats that could undermine the monopoly position that lies at the heart of the Government's antitrust case. Several documents were entered into evidence under seal, including every document obtained from America Online, at the online service's insistence. But none of the public documents showed that America Online subscribed to any of opinions and plans offered by the documents from Goldman and Sun. In any case, it was not at all clear that any of it made much of an impression on Judge Thomas Penfield Jackson, who is hearing the case without a jury. After Lacovara had introduced several of these documents, Judge Jackson calmly asked him to stop, noting that they were "cryptic" and the witness, Fisher, was not familiar with them. What is more, Judge Jackson added, "All this is from last fall. It's not clear whether this is current thinking or just wishful thinking." The larger point Lacovara offered was that America Online and other companies were trying to counter Microsoft's dominance by offering word processers, spreadsheets, e-mail programs, calendars and other applications as online products that work with any operating system. It was this budding business strategy that a Microsoft employee called "very scary," and Fisher acknowledged that Microsoft might have reason to be concerned. "The market is moving under our feet," Lacovara said on the courthouse steps later. David Boies, the lead Government lawyer, responded, "The fundamental issue for us is the operating system monopoly. And that hasn't changed.">>