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Microsoft claims Sun-Netscape carve-up

The pistol is smoking a little, but not as much as you might think

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Microsoft attorneys yesterday produced evidence that two years ago Sun and Netscape were engaged in one of the very activities Microsoft itself is accused of -- carving up the browser market. DoJ attorney David Boies dismissed the evidence -- Sun internal documentation -- as irrelevant, but an examination of the parallels and the differences between what Sun and Microsoft were up to is instructive. For Microsoft, Tom Burt produced an internal email that suggested that Sun and Netscape had been engaged in a series of meetings in order to avoid competing with one another in Internet software, and to "unify browser efforts; stop competing". There are several ways you can look at that. From the point of view of antitrust law you might reckon there's a clear difference between Microsoft doing this kind of thing and other companies doing it. If it is established that Microsoft has a monopoly position, then the construction of no-competition agreements and dubious-sounding alliances via that monopoly is clearly anticompetitive. But if a group of companies (Oracle, Sun, Netscape and IBM, as Microsoft has claimed) get together to challenge Microsoft, but don't themselves have a monopoly, then they're not necessarily doing anything wrong. They may well agree not to compete with one another, but that's different from Microsoft striking a deal (or allegedly attempting to strike a deal) whereby Microsoft got the exclusive on Windows browsers and Netscape got everything else. It's a fine point, and you can see why it frustrates Microsoft. Sun, IBM and Oracle clearly do want to destroy Microsoft's 'monopoly', and it seems obvious to Microsoft (and indeed to any rational person) that if they succeeded they'd replace it with their own cartel/monopoly. So it's not illegal to be so successful that you end up with a monopoly, it's just illegal to have one and (allegedly) abuse it. The philosophical point is too tricky for the Redmond mindset. But if we look at it another way, we can see that in the Sun-Netscape case a clear-cut definition of where the monopoly lay is a lot trickier, and that's good new for Microsoft. In 1996 Microsoft ran the desktop, and maybe we could call it a monopoly. But it didn't run the browser market. Netscape had been pretty close to a monopoly of browsers before Microsoft introduced Internet Explorer, in late 1995, and leveraging Netscape out was at least initially tricky for the company, particularly as by its own admission early version of IE weren't very good. So you could say at this point that Microsoft was the challenger while Netscape was the monopoly. Sun had been working on its own browser, Hot Java, and although IBM's browser didn't come up in court yesterday, it had one of its own too. But Sun didn't pursue Hot Java (because, said Sun VP James Gosling yesterday, it couldn't see how to make money out of it when IE was free) and IBM also abandoned its browser. In some lights, this might start to look like a smoking pistol - in an effort to stop Microsoft, the rivals put their weight behind Netscape, and it can at least be argued that they were shoring up a monopoly. Unsuccessfully, though. So is it legal to try to protect a monopoly so long as you fail? You can see why Redmond doesn't grasp that one either. But although Microsoft's case might seem superficially strong at this point, there's yet another way to look at it. The Microsoft view that Sun and Netscape were trying to protect a monopoly by decreasing competition crumbles if we remember first, that Sun and Netscape are not the defendants in the current antitrust case, and second that Microsoft is being accused (among other things) of attempting to achieve a monopoly in the browser market via unfair means. Microsoft has indisputably increased its share of the browser market, and if it can be proved that it did so via unfair agreements with ISPs and OEMs and by tying the browser to the OS (where, to labour the point, it did and does have a monopoly), then Microsoft's and Sun's alleged attempts to stitch up deals with Netscape are clearly entirely different matters. The difference between pooling efforts and agreeing not to compete with one another may be a fine one, but both of these are wildly different from using one monopoly in order to create others. Redmond must have trouble understanding that one too. ® Complete Register trial coverage

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