MS strives to prove potential AOL, Netscape pact anti-competitive

Colbourn cross-examination continues...

The cross-examination and rebuttal of AOL VP David Colburn continued all day, with John Warden, Microsoft's trial attorney, trying to establish that from late-1995, Netscape and AOL were discussing the possibility of AOL taking Navigator, with provisions to avoid competition. It would be illegal for a monopolist to have such discussions, but not probably for AOL and Netscape as the point of the collaboration was to was to compete against Microsoft. In the event the discussions did not result in an agreement, because AOL was wooed by Microsoft. Warden tried to make something of AOL's desire to run Netscape's Web site in early 1996, which was an alternative to AOL having a seat on Netscape's board. At the time, AOL feared both Microsoft and Netscape, the former because of MSN, the latter because Navigator presented a non-proprietary world to AOL subscribers. Colburn explained to Warden that AOL was trying to establish a strategic relationship and united front against Microsoft. Warden tried to make the case that AOL customers had a choice of browsers, but Colburn said it was non-trivial for users to work out how to do this. Colburn's testimony gives considerable detail as to how further agreements with Microsoft limited AOL's ability to help its customers who wanted an alternative. The line of questioning did little to progress the case, but Judge Jackson did not intervene. It seemed as though Warden had been told to spin things out so that Ball Gates' video testimony would not be run excessively over the Halloween weekend. David Boies, the DoJ's trial lawyer, was asked afterwards if Microsoft was filibustering, but he declined to comment in view of his nearness to Capitol Hill, he said, where legislation is often talked out by over-long speeches. Warden continued to press the Microsoft view that it "won" AOL because it had a superior product in Internet Explorer, but the evidence that AOL's presence with Windows 9x was highly important for AOL is very convincing. A lighter moment arose when email messages between Case and Netscape CEO Jim Barksdale revealed some role playing. Microsoft was "Hitler", Case was "Franklin D" and Barksdale was initially "Stalin", but after complaining that his character was not very politically correct, he became instead "Winston C". A letter from Case to Barksdale suggested pooling technologies, since Netscape was "primarily in the enterprise software business", and AOL was primarily in the consumer online business. Warden did not manage to make a convincing case that non-consummated agreements by non-competing partners were a potential problem in competition law. Boies claimed that there could be no antitrust violation because AOL operated principally in the online service business and Netscape in the server software business. The concern is growing that even if the DoJ wins the case, any remedy in the client space will probably be inadequate in the server space. ® Click for Register trial coverage Click for more stories Click for story index

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