By Rachel Chalmers
Microsoft Corp has named the rebuttal witnesses it has chosen to testify in the US government’s antitrust trial against it. Microsoft will call David Colburn, senior VP of business affairs for America Online Inc; Gordon Eubanks, president and CEO of Oblix Inc and Professor Richard Schmalensee, dean of the Massachusetts Institute of Technology Sloan School of Management. To mere mortals these choices may seem eccentric to the point of lunacy; lead prosecutor David Boies made short work of Schmalensee last time he took the stand for Microsoft (CI No 3,575). But lawyers see things differently. Our rebuttal witnesses will show that the $10bn merger of AOL and Netscape completely undercuts the government’s case, said Bill Neukom, Microsoft’s senior VP for law and corporate affairs.
On the other side of the case, if Reuters is right, IBM Corp may become the first of the Wintel OEMs to testify for the government. Big Blue is expected to detail how Microsoft has used its dominant position in desktop operating systems to bend OEMs to its will. In documents filed under seal with the US District Court in Washington, IBM has apparently provided evidence to support the government’s claims that Microsoft uses predatory pricing and exclusionary licenses to keep PC manufacturers toeing its line. In particular, IBM’s testimony is expected to cover Microsoft’s decision three years ago to prevent OEMs from changing the Windows startup sequence. As a consequence of that decision, OEMs were barred from customizing the initial appearance of the desktop software on machines they assembled and sold.
Until now, OEMs have refused to take the stand, citing fear of Microsoft’s retaliation. Some observers view the IBM testimony as a potential clincher for the Department of Justice, and as a major influence on possible remedies if the judge rules against the Redmond software giant. It may be that Big Blue now sees the government as the likely winner of the case. In an interview with the Wall Street Journal, however, Microsoft spokesperson Mark Murray downplayed the importance of any evidence IBM could present. Computer makers have always had complete freedom to ship Netscape Navigator and other competing software on every computer they sell, Murray said. He added that the strategies the government alleges are anti-competitive: are commonplace throughout the high-tech sector and every other industry in America.
