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Gates video 'not a beautiful thing to watch,' says Microsoft brief

Here we go again - the whole transcript of yesterday's very strange Gates testimony

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Even Microsoft legal advisor Joseph di Genova, previously a DC attorney general, had to admit that the third Gates videotape extracts to be shown in court yesterday in Washington was "not a beautiful thing to watch". Indeed it wasn't. Di Genova wasn't allowed to say much more as his utterances are not exactly helping Microsoft's case. He stood alongside spokesman Mark Murray who produced the spin: "It was two strong-willed people forcing each other to be as precise as possible... Mr Gates wasn't allowing the government to put words in his mouth. In the context of a deposition, Bill did exactly what a witness is supposed to do." Whether this would include being conveniently forgetful, evasive, and uncooperative is a matter that Judge Jackson will decide -- and Gates' performance, coupled with Judge Jackson's body language (he did not attempt to stifle his mirth at Gates' performance, and shook his head at some of Gates' responses) indicates that he has taken the view that Gates' credibility as a witness is very low. A US district court is no place to indulge in rudeness and arrogance. Gates' performances are, in judicial terms, the greatest challenge to Microsoft's defence. The DoJ is succeeding in its main contention that the Gates extracts show that Microsoft is trying to present a revisionist version of history, and nowhere is this better seen than in Gates' trying to squirm around admitting that Microsoft was anticompetitive towards Netscape and others. One of Gates' objectives appeared to be to avoid uttering the forbidden word 'Netscape'. Boies banged home the point when he said: "What we saw today shows that Microsoft was quite concerned about Netscape in early 1996, and that Microsoft was not merely trying to improve its product." Judge Jackson asked DoJ trial attorney David Boies at the end of the third instalment from Gates' videotaped deposition: "How long did this deposition take?" Boies told him three days. Chirpy Microsoft spokesman Mark Murray, playing to the court of public opinion on the courthouse steps, said: "The government is simply trying to use Bill's testimony to inject some life into their failing case." It was comforting to know this. Boies made a brief appearance on the steps too, to say that "What the chief executive of Microsoft said [about browsers] is relevant." Microsoft tried to develop the argument that showing the tapes is a sideshow, and a personal attack on Gates. The DoJ contends that the tape extract provides a context by showing how Gates was at he centre of Microsoft strategy towards competitors. Microsoft was allowed to include some extracts to be shown. Gates' pauses before answering a question are getting longer, and have now crossed the 30-second barrier. After one particularly pregnant pause, Boies asked Gates if he understood the question. Gates replied that "I'm pausing to see if I can understand it." Readers who are not easily shocked are invited to peruse the full text of Gates III. Houck is the lead attorney for the 20 states. Heiner is a Microsoft lawyer who occasionally inserts an "Objection". That is not all he says, but only the objection is recorded. Houck: I'll ask you to take a look, sir, at page 8 of Gov. Ex. 679 And before you do so let me ask you this. Do you recall attending this Financial Analysts Day Executive Q & A session? Gates: Yes. Houck: And what is that exactly? Gates: It's a chance for people to ask questions. Houck: And who attends? Gates: Some people from the press, some people from various financial firms or investment firms. Houck: On page 8 appears the following question: "Bill and Steve, you both referred to the importance of building browser share over the coming year. Can you be more explicit about why browser share is important to various aspects of your business and maybe talk about some of the initiatives you're going to be undertaking to increase it?" And then Mr. Ballmer gives a response, the last paragraph of which is as follows: "There are a lot of things we're investing in over the course of the next year in marketing. of course, the new browser is the key thing - IE 4.0. But if you take a look at the initiatives, the content partnership that Paul's teams have formed, the things that we're doing with ISP, the work we're doing with large accounts on digital nervous systems, where the IE browser -- IE 3 today, IE 4 tomorrow -- is fairly fundamental to what we're doing on browser share, the way we're trying to get large accounts, and large and small accounts to author their content to use our dynamic HTML stuff; all of those actions should help, 1 think, drive up our browser share." And you're quoted as saying, "Yeah, along with the integration." Do you recall that question and your giving an answer, Mr. Gates? Gates: No. Houck: Do you have any reason to doubt the accuracy of this transcript? Gates: Well, in general, transcripts like this which come off an audio tape are somewhat unreliable, but I don't have a specific recollection about that specific question and answer. End of segment: (major discontinuity: gap of 431 pages) Boies: The term browser is a term that is widely used within Microsoft, or at least was until this year; correct, sir? Heiner: Objection. Gates: We use the term browser, yes. Boies: And you personally used the term browser, did you not, sir? Gates: Yes, that term is used in quite a variety of ways. Boies: Including by you; correct, sir? Gates: Yes. Boies: You've written e-mails about browsers; correct, sir? Gates: I've written e-mails where the term browser was used. I wouldn't say it was necessarily an e-mail about browsers. Boies: Have you ever written an e-mail that you considered to be about browsers, sir? Gates: I'll bet there's e-mail where the primary subject relates to browsers. I don't remember a specific piece of e-mail. Boies: And when you wrote e-mails using the term browsers, you believed that people would understand what you meant by browsers; correct, sir? Gates: I'm sure there was enough context in the e-mail that I felt I could communicate something of meaning. Boies: And you've used the term browser in dealing with people outside of Microsoft, have you not, sir? Gates: Yes. It's a term that I've used both internally and externally. Boies: And there are a lot of people outside Microsoft that have written articles about browsers; correct, sir? Gates: There's been articles about browsing and the technology people use for browsing and comparing the different -- how different companies do that, and they used the term browser. Boies: Yes. The industry and Microsoft tracks what is referred to as browser market share; correct sir? Gates: No. Boies: No? Does Microsoft track browser market share? Gates: I've seen usage share. Boies: You've seen usage share? Gates: Uh-huh. But not -- market share usually refers to something related to -- not to usage. And with browsers, I've seen mostly usage. Now, some people might refer to that as a market share, but it's not a market share. Boies: What is a market share? Gates: Well, when I think of a market share, I think of where you're comparing the revenue of one company to the revenue of another company. Boies: The total revenue of a company? Gates: No, the revenue related to one company's product to the revenue of another company's product. Boies: And that's what you think of when you use the term market share; is that your testimony? Gates: Usually. Boies: Are you aware of documents within Microsoft that describe browser share as the company's number one goal? Gates: No. I'm aware of documents within Paul Maritz's group that may have stated that. Boies: Is Paul Maritz's group within Microsoft? Gates: Yes, but his -- he doesn't set the company-wide goals. Boies: Mr. Maritz you identified last week as being a group vice-president; is that correct? Gates: Uh-huh. Several times. Boies: And he is the group vice-president with responsibility for Windows; is that correct? Gates: That's among his responsibilities. Boies: And included in his responsibilities was Internet Explorer; is that correct? Gates: Our browsing technology was part of that group. Boies: Was Internet Explorer part of that group? Gates: Yes. Boies: Now, did you ever tell Mr. Maritz that browser share was not the company's number one goal? Gates: No. Boies: You knew Mr. Maritz was telling people that browser share was the company's number one. goal, did you not, sir? Gates: I knew that Mr. Maritz was saying to people that the -- that a top goal and perhaps number one goal for his group was browser usage share. End of segment (discontinuity: gap of 53 lines of testimony) Boies: Interpreting what Mr. Maritz has communicated in light of that, do you know how Mr. Maritz came to the view that browser share was the number one goal? Gates: Well, I think he was aware of the increasing popularity of the Internet and the growing usage of the Internet and felt that all the many many innovations we were doing in Windows, that a particular focus had to be doing the best job on the Internet and Internet browsing features of the operating system and seeing if we could innovate enough to make people prefer to use that technology from us. Boies: Mr. Gates, isn't it the case that you told Mr. Maritz that browser share was a very very important goal and that's why he believed it? Gates: I guess now we're delving into the inner workings of Paul Maritz's mind and how he comes to conclusions? Boies: Well, let me try to ask you a question that won't require you to delve into anybody else's mind. Did you tell Mr. Maritz that browser share was a very very important goal? Gates: I know we talked about browser share being important. Boies: I'm not asking you what he said to you. I'm not asking what topic you talked about. I'm asking you whether you told Mr. Maritz that browser share was a very very important goal? Gates: I remember that we agreed that it was an important goal. I'm not sure which one of us reached that feeling before the other. End of segment (discontinuity of 46 lines of testimony) Boies: Did you write Gov. Ex. 295 Mr. Gates, on or about January 5, 1996? Gates: I don't remember doing so specifically, but it appears that I did. Boies: And the first line of this is, "Winning Internet browser share is a very very important goal for us." Do you see that? Gates: I do. Boies: Do you remember writing that, sir? Gates: Not specifically. Boies: Now, when you were referring there to Internet browser share, what were the companies who were included in that? Gates: There's no companies included in that. Boies: Well, if you're winning browser share, that must mean that some other company is producing browsers and you're comparing your share of browsers with somebody else's share of browsers; is that not so, sir? Gates: You asked me if there are any companies included in that and now -- I'm very confused about what you're asking. Boies: All right, sir, let me see if I can try to clarify. You say here "Winning Internet browser share is a very very important goal for us." What companies were supplying browsers whose share you were talking about? Gates: It doesn't appear I'm talking about any other companies in that sentence. Boies: - Well, sir, is a market share something that is compiled only for one company? I understand if a company has a monopoly, that may be so, but in a usual situation where a company does not have a monopoly, share ordinarily implies comparing how much of a product one company has with how much of a product another company has; correct? Gates: Yes. Boies: Now, when you were talking about Internet browser share here, what companies were you talking about? Gates: You're trying -- you seem to be suggesting that just because share involves comparing multiple companies, that when I wrote that sentence, 1 was talking about other companies. It doesn't appear that I'm talking about other companies in that sentence. I've really read it very carefully and I don't notice any other companies in there. Boies: Oh, you mean you don't see any other company mentioned in that sentence; is that what you're saying? Gates: The sentence doesn't appear to directly or indirectly refer to any other companies. Boies: When you refer to an Internet browser share here, sir, what is the share of? Gates: Browser usage. Boies: Of course, you don't say "browser usage" here, do you, sir? Gates: No, it says "share." Boies: Now, let's say that you meant browser usage because that's what your testimony is. What browser usage were you talking about in terms of what your share of browser usage was? What browsers? Gates: I'm not getting your question. Are you trying to ask what I was thinking when I wrote this sentence? Boies: Let me begin with that. What were you thinking when you - wrote that sentence? Gates: I don't remember specifically writing this sentence. Boies: Does that mean you can't answer what you were thinking when you wrote the sentence? Gates: That's correct. Boies: So since you don't have an answer to that question, let me put a different question. Gates: I have an answer. The answer is I don't remember. Boies: You don't remember what you meant. Let me try to ask you - Gates: I don't remember what I was thinking. Boies: Is there a difference between remembering what you were thinking and remembering what you meant? Gates: If the question is what I meant when I wrote it, no. Boies: So you don't remember what you were thinking when you wrote it and you don't remember what you meant when you wrote it; is that fair? Gates: As well as not remember writing it. Boies: Okay. Now, let me go on to another paragraph and see whether you remember writing that or not. And that is the second paragraph, which reads, "Apparently a lot of OEMs are bundling non-Microsoft browsers and coming up with offerings together with Internet Service providers that get displayed on their machines in a FAR" and you've capitalized each of the letters in far "more prominent way than MSN or our Internet browser." Do you see that? Gates: Uh-huh. Boies: Did you write that sentence, Mr. Gates? Gates: I don't remember, but I have no reason to doubt that I did. Boies: Do you remember what you were thinking when you wrote that sentence or what you meant when you wrote that sentence? Gates: No. Boies: Do you remember that in January, 1996, a lot of OEMs were bundling non-Microsoft browsers? Gates: I'm not sure. Boies: What were the non-Microsoft browsers that you were concerned about in January of 1996? Gates: What's the question? You're trying to get me to recall what other browsers I was thinking about when I wrote that sentence? Boies: No, because you've told me that you don't know what you were thinking about when you wrote that sentence. Gates: Right. Boies: What I'm trying to do is get you to tell me what non-Microsoft browsers you were concerned about in January of 1996. If it had been only one, I probably would have used the name of it. Instead I seem to be using the term non-Microsoft browsers. My question is what non-Microsoft browsers were you concerned about in January of 1996? Gates: I'm sure -- what's the question? Is it -- are you asking me about when I wrote this e-mail or what are you asking me about? Boies: I'm asking you about January of 1996. Gates: That month? Boies: Yes, sir. Gates: And what about it? Boies: What non-Microsoft browsers were you concerned about in January of 1996? Gates: I don't know what you mean "concerned." Boies: What is it about the word "concerned" that you don't understand? Gates: I'm not sure what you mean by it. Boies: Is- Gates: Is there a document where I use that term? Boies: Is the term "concerned" a term that you're familiar with in the English language? Gates: Yes. Boies: Does it have a meaning that you're familiar with? Gates: Yes. Boies: Using the word "concerned" -- consistent with the normal meaning that it has in the English language, what Microsoft -- or what non-Microsoft browsers were you concerned about in January of 1996? Gates: Well, I think I would have been concerned about Internet Explorer, what was going on with it. We would have been looking at other browsers that were in use at the time. Certainly Navigator was one of those. And I don't know which browser AOL was using at the time, but it was another browser. Boies: What I'm asking, Mr. Gates, is what other browsers or what non-Microsoft browsers were you concerned about in January of 1956? I'm not asking what you were looking at, although that may be part of the answer, and I don't mean to exclude it, but what non-Microsoft browsers were you concerned about in January of 1996? Gates: Well, our concern was to provide the best Internet support, among other things, in Windows. And in dealing with that concern, I'm sure we looked at competitive products, including the ones I mentioned. Boies: Let me try to use your words and see if we can move this along. What competitive products did you look at in January of 1996 in terms of browsers? Gates: I don't remember looking at any specific products during that month. Boies: Were there specific competitive products that in January of 1996 you wanted to increase Microsoft's share with respect to those products? Heiner: Objection. Boies: Do you understand the question, Mr. Gates? Gates: I'm pausing to see if I can understand is it. Boies: If you don't understand it, I'd be happy to rephrase it. Gates: Go ahead and rephrase it. I probably could have understood it if I thought about it, but go ahead. Boies: In January, 1996, you were aware that there were non-Microsoft browsers that were being marketed; is that correct? Gates: I can't really confine it to that month, but I'm sure in that time period I was aware of other browsers being out. Boies: And were those non-Microsoft browsers, or at least some of them, being marketed in competition with Microsoft's browser? Gates: Users were making choices about which browser to select. Boies: Is the term "competition" a term that you're familiar with, Mr. Gates? Gates: Yes. Boies: And does it have a meaning in the English language that you're familiar with? Gates: Any lack of understanding of the question doesn't stem from the use of that word. Boies: And you understand what is meant by non-Microsoft browsers, do you not, sir? Gates: No. Boies: You don't Is that what you're telling me? You don't understand what that means? Gates: You'll have to be more specific. What - Boies: Do you understand what is meant by non-Microsoft browsers? Gates: In the right context, I'd understand that. Boies: Is the term non-Microsoft browser a term that you think has a reasonably common and understandable meaning in the industry? Gates: Yes. It's only the scope of what you'd include in it that would vary according to the context. Boies: Okay. That is, in some contexts you'd include more and in some contexts you'd include less? Gates: That's right. Boies: When you refer to non-Microsoft browsers generally, are there particular browsers that you have in mind? Gates: There are many that I would include in that. And as I said, it would be broader depending on the context. Boies: Do all of the non-Microsoft browsers that you're aware of compete with Internet Explorer? Gates: In the sense that users select which browsers they want to use, yes. Boies: Let's focus on January of 1996. What were the non-Microsoft browsers that, in your view, were competing with Internet Explorer in January of 1996? Gates: Well, users could choose from a number of browsers, including the original Mosaic browser, the Netscape Navigator, and I don't know what version they had out at the time. The AOL browser. And some others that were in the market. End of segment (discontinuity of 15 lines of testimony) Boies: What I want to do is I want to focus on competition the way you use it in the ordinary operation of your business. Gates: And one of the senses is whether people choose to use our way of providing a feature or if they choose to get additional software to provide them with that feature. Boies: And was that the choice that users were making between Internet Explorer and the AOL browser in January of 1996, Mr. Gates? Gates: Users can choose between those two. End of segment (discontinuity of 22 lines of testimony) Boies: And what you've testified is that when you use browser share, you meant usage share correct? Gates: That's right. Boies: So that as you use the term browser share, it is your testimony that in January of 1996 Microsoft was competing for browser share with Mosaic, Navigator and AOL's browser; correct? Gates: In the sense that users would choose to use one of those in varying degrees, yes. Boies: But in terms of what you meant by browser share, that was what you considered to be competition in January of 1996; correct? Gates: That we were competing to see who could make the better browser that users would choose to take advantage of, yes. End of segment (discontinuity of 34 lines of testimony) Boies: Let me try to go back now to the first sentence in your memo of January 5, 1996 that has been marked as Gov. Ex. 295 where it says, "Winning Internet browser share is a very very important goal for us." Does the prior discussion that we've just had refresh your recollection that you would have been referring primarily there to the goal of gaining market share versus Netscape? Gates: You keep trying to read Netscape into that sentence and I don't see how you can do that. Boies: I just really want to get your testimony, Mr. Gates. Gates: Okay. Boies: And that is, when you wrote, "Winning Internet browser share is a very very important goal for us," in January, 1996, were you referring primarily to gaining market share compared to Netscape? Gates: I've testified I don't remember what I was thinking when I wrote that sentence. Boies: If you can't remember what you meant when you wrote that sentence, do you at least remember that in January, 1996, winning Internet browser share was an important goal for Microsoft? Gates: Yes. Boies: And with respect to the goal of winning Internet browser share in 1996, was that goal primarily to gain share compared to Netscape? Gates: Not necessarily. Boies: When you talk about winning browser share, not necessarily just in this document but generally, you're referring to gaining market share compared to other competitors; correct? Gates: Or any new products that come along. Boies: That are competitive; correct? Gates: That people use for that function. End of segment (major discontinuity of 21 pages of tesdtimony) Boies: Let me ask you to look at a document that we will mark Gov. Ex. 297. The third item on is the first page is an e-mail from Paul Maritz to you dated January 16, 1996. It is to you and a number of other people, but you are the first there. Do you see that? Gates: Yes. (The document referred to was marked Gov. Trial Ex. 297 by the court reporter as Gov. Trial Ex. 297 3-8 for identification and is attached hereto.) Boies: Did you receive this e-mail in January, 1996? Gates: I don't remember receiving it, but I have no reason to doubt that I did. Boies: The second sentence of Mr. Maritz's e-mail to you says, "We need to look carefully at any significant opportunity to gain share versus Netscape." Do you see that? Gates: That's part of the sentence that I see. Boies: The rest of the sentence says, "and think carefully before AOL goes off and partners with Netscape." Do you see that? Gates: Yes. Boies: That's the rest of the sentence; right? Gates: Right. Boies: Even though you don't recall receiving this particular e-mail, do you recall Mr. Maritz telling you in or about January of 1996 that he believed that Microsoft had to look carefully at any significant opportunity to gain share versus Netscape? Gates: No. Boies: Do-you recall Mr. Maritz telling you in or about January of 1996 that there was a possibility that AOL was going to go off and partner with Netscape? Gates: I don't know the time frame, but I know there was -- there came a time where AOL was considering whether to keep doing their own browser technology or work with someone else on that. Boies: And is that your understanding of what Mr. Maritz was referring to when he talks about AOL going off and partnering with Netscape? Gates: It appears to be a mail about -- let me take a look at it. It appears to be a mail about OEMs prominently featuring the AOL client in such a strong way that anything we would do for AOL in that regard would be of no impact and, therefore, that maybe we should work with AOL on the browser. End of segment (major discontinuity of 38 pages of testimony) Boies: Let me show you a document that has been marked as Gov. Trial Ex. 478. This purports to be a message to you and others from Brad Chase dated March 13, 1997. Did you receive this message in or about March of 1997? Gates: I don't remember receiving it. In fact, it's very strange that the e-mail names aren't expanded. But I probably received it. (The document referred to was marked Gov. Trial Ex. 478 by the court reporter for identification and is attached hereto.) Boies: Let me go down to the third paragraph of the document and the fifth sentence that says "Browser share needs to remain a key priority for our field and marketing efforts." Do you see that? Gates: In the third paragraph? Boies: Yes. Gates: Okay, the third sentence, the third paragraph. Yeah. Boies: Were you told in or about March of 1997 that people within Microsoft believed that browser 'share needed to remain a key priority for your field and marketing efforts? Gates: I don't remember being told that, but I wouldn't be surprised to hear that people were saying that. Boies: Immediately before that sentence there is a statement that Microsoft needs to continue its jihad next year. Do you see that? Gates: No. Boies: The sentence that says "Browser share needs to remain a key priority for our field and marketing efforts," the sentence right before that says "we need to continue our jihad next year." That's the way it ends. Do you see that? Gates: Now I see -- it doesn't say Microsoft. Boies: well, when it says "well there, do you understand that means something other than Microsoft, sir? Gates: It could mean Brad Chase's group. Boies: Well, this is a message from Brad Chase to you, Brad Silverberg, Paul Maritz and Steve Ballmer, correct? Gates: As I say, it's strange that this -- if this was a normal piece of e-mail, it wouldn't print like that. I'm not aware of any way -- maybe there is some way -- that e-mail ends up looking like this when you print it out. Boies: I wasn't the one that was asserting it was an e-mail. I don't know whether it is an e-mail or memo or what it is. All I know is it was produced to us by Microsoft. And the first line of it says "To" and the first name there is "Bradsi." Do you see that? Gates: Uh-huh. Boies: Does that refer to Brad Silverberg? Gates: Usually you can use that shorthand in typing in someone's name, but when you print out e-mail, it doesn't come out that way. Boies: Do you believe that the reference here to "Bradsi" is a reference to Brad Silverberg, sir? Gates: Yes. Boies: The next addressee is "Paulma." Do you believe that that is Paul Maritz? Gates: Yes. Boies: And the next addressee is "Steveb". Do you believe that that is Steve Ballmer? Gates: Yes. Boies: The next addressee is "Billg" and do you believe that that is yourself? Gates: Yes. Boies: And it says it's from "Bradc" and do you believe that is Brad Chase? Gates: Yes. Boies: Now, when Brad Chase writes to you and the others "we need to continue our jihad next year," do you understand that he is referring to Microsoft when he uses the word "we"? Gates: No. Boies: What do you think he means when he uses the word "well? Gates: I'm not sure. Boies: Do you know what he means by jihad? Gates: I think he is referring to our vigorous efforts to make a superior product and to market that product. Boies: Now, what he says in the next sentence is, "Browser share needs to remain a key priority for our field and marketing efforts;" is that correct? Gates: Yes. Boies: The field and marketing efforts were not involved in product design or making an improved browser, were they, sir? Gates: No. ® Complete Register trial coverage

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