November 24, 1998 6:15 AM PST

New evidence of Microsoft pushing IE

WASHINGTON--Antitrust prosecutors have released new evidence documenting deals Microsoft signed with Internet service providers and Web sites to get them to distribute the Internet Explorer browser exclusively, or at least to the vast majority of their customers.

Among the documents, which were released late yesterday, are contracts signed with Walt Disney and CNET:The Computer Network, requiring them to "promote [Internet Explorer] and no other browser." (CNET publishes News.com.)

The Justice Department (DOJ) Microsoft's day in court and 20 states, which sued Microsoft in May, claim that the exclusionary deals are part of a pattern by Microsoft that violates antitrust laws.

The new evidence--which was released to support a government witness's testimony that Microsoft has abused what he called the company's monopoly power--also includes email demonstrating requirements that ISP partners ship Internet Explorer to the vast majority of their subscribers. The witness, Frederick Warren-Boulton, is expected to take the stand today for a third day of cross-examination.

"Remember that See CNET Radio: Our Man in Washington ISPs have to swear allegiance to IE for typically 75 percent of all the browsers they distribute in order to get into the referral server," Microsoft's Cameron Myhrvold wrote to two of his colleagues, Brad Chase and Joachim Kempin. In an earlier message, Myhrvold complained that "I have had a hard time guiding the ISPs to IE loyalty even when I make them sign explicit terms and conditions in a legal contract."

The email was part of a series of exchanges sent in April 1997 discussing the best way to boost usage of Microsoft's Internet Explorer browser.

The government released the documents in support of Warren-Boulton's testimony. A top Justice Department economist under the Reagan administration, Warren-Boulton has claimed in written testimony that Microsoft holds a monopoly in the operating system market for personal computers that run on Intel chips. He further accuses the software giant of abusing that monopoly position through a series of predatory acts, such as shutting out competitors in the Internet space through restrictive contracts with Web sites, service providers, and computer vendors.

In cross-examination yesterday, Microsoft attorney Michael Lacovara tried to discredit that testimony, using America Online's buy out of Netscape Communications as a potent example of just how precarious Microsoft's position is in the fast-moving high-tech industry.

Lacovara also has challenged a number of Warren-Boulton's economic theories, arguing that unlike a monopolist, Microsoft is unable to raise the price of its products above competitive levels, and that Microsoft's partnerships have had no harmful effects on competitors.

Lacovara's cross-examination is expected to last through Monday. After the trial recesses today, it will not resume until Monday in observance of the Thanksgiving holiday.

 

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