Microsoft's questioning of the government's final witness in its antitrust case turned combative Thursday over
the software giant's promise to make its Internet software
Microsoft's lawyer even offered to pause so the witness
economist Franklin Fisher of the Massachusetts Institute of
Technology could control his blood pressure.
The most contentious moments came amid questions about the price
Microsoft charges for its Windows operating system and its Internet
The government contends the company bundled its browser free
into newer versions of Windows and pledged to keep its Internet
software "forever free" solely to undercut rival Netscape.
Netscape's own popular browser competed directly with
Microsoft's and once earned that company tens of millions of
"If Henry Ford had a monopoly, we'd all be driving black
cars," Fisher said, his voice rising. "That's not what
competition is about. That's not what helping consumers is about."
"Now you seem agitated, sir," Microsoft lawyer Michael
"I am agitated. I feel very strongly about this," Fisher said.
"We're going to live in a Microsoft world. It might be a nice
world, but it's not a competitive world."
Lacovara offered to take a short break, but Fisher said his
blood pressure wasn't cause for concern.
At another point, Fisher paused after Lacovara asked about his
previous testimony that Microsoft "studied and tried to implement
ways to disable Netscape and reduce total browser sales."
Lacovara began to speak again when Fisher replied: "I'm just
dumbfounded by the question. It's not that I can't answer it."
Fisher then recounted government allegations that Microsoft
bundled its own browser into Windows, promised the browser would
remain free and used its influence to discourage others from
distributing Netscape's browser.
Under federal antitrust law, a legal claim of predatory pricing
includes the expectation that Microsoft eventually would raise its
prices once it dominated the market.
In earlier testimony, Fisher told the judge that Microsoft spent
"hundreds of millions of dollars" to develop its browser and set
its pricing "for the explicit purpose of depriving rivals of
revenues needed to be viable."
Microsoft maintains that it never planned to earn money selling
its browser, but did plan to profit from advertising fees. The
company's chairman, Bill Gates, previously said in an interview
that advertising fees from a browser, from the search page and the
home page, far exceed the cost of development. "So, clearly, the
browser should be free."
Lacovara, for example, said companies with tools to search for
specific information on the Internet such as Lycos and AltaVista
pay Microsoft $15 million annually for prominent placement on its
But Fisher said: "That (explanation) appears to have been
invented in the middle of this trial."
Outside the courtroom, a Microsoft spokesman cited a single line
in a May 1995 e-mail from Gates discussing what he called "a very
powerful deal of some kind we can do with Netscape."
Gates suggested in the e-mail that Netscape be told that
browsers "make no money." Netscape earned roughly $8.2 million
selling its browser during the second fiscal quarter that year.
Fisher acknowledged to Lacovara that many software companies
distribute products free in order to sell related products or
services, or to gain a foothold in a market. But Microsoft went
further, he said.
Microsoft will begin calling its witnesses starting with MIT
economist Richard Schmalansee next week.