As the antitrust trial entered its seventh week here, Microsoft attorney Michael Lacovara challenged economist Frederick Warren Boulton's contention that restrictions the software giant placed on computer sellers, also known as original equipment manufacturers or OEMs, has harmed Netscape's ability to market its Navigator browser.
Warren-Boulton conceded that some of the restrictions--which include limits on the sequence of screens that new computers can display--were dropped in June. In written testimony submitted in October, Warren-Boulton testified the restrictions "have significant exclusionary effects" on non-Microsoft browsers.
The Justice Department's (DOJ) and 20 states, which filed suit in May, claim that the restrictions are part of a broad pattern that violates antitrust laws. Trial here in U.S. District Court resumed today after a six-day break for the Thanksgiving holiday.
Under tedious questioning from Lacovara, Warren-Boulton also acknowledged that Microsoft's OEM pre-installation kit, or OPK, allows vendors to install Netscape's icon on a start-up menu found on Windows 98. Lacovara also attacked Warren-Boulton over his testimony that restrictions Microsoft places on Internet content providers sites unfairly exclude Netscape.
Lacovara pointed out, for instance, that Walt Disney was free to distribute Navigator, and that restrictions prohibit the promotion of non-Microsoft browsers were imposed on only about 20 Web sites. (CNET, publisher of News.com, was among them.)
Throughout the grilling, however, the economist stuck to his earlier testimony. "It's difficult to see any reason why Microsoft would want to imposed those kinds of restrictions as part of an efficiency" scheme, said Warren-Boulton, who was the top economist in the Justice Department's antitrust division under the Reagan administration.
In earlier testimony, Warren-Boulton claimed that Microsoft holds a monopoly in the operating system market for Intel-based personal computers. He further contends that the software giant attempted to crush Netscape's browser and Sun Microsystems' Java programming language because the technologies posed potential threats to Microsoft's valuable Windows franchise.
Today's painstaking cross-examination is largely a repeat of the previous three days. In his questioning, Lacovara has challenged nearly every one of Warren-Boulton's assertions, from claims that "network effects" are responsible for the success of Windows to testimony that Microsoft has harmed Netscape's ability to distribute its Navigator browser.
Although academic in tone, Warren-Boulton's testimony could be devastating if accepted by U.S. District Judge Thomas Penfield Jackson, and Microsoft is sparing nothing in trying to impeach it.
Due next on the stand is Java creator and Sun vice president James Gosling, who is expected to testify that Microsoft used its dominance to snuff out Java. Gosling will probably take the stand later this week.
Lacovara also accused Warren-Boulton of mischaracterizing the testimony of Microsoft executive Brad Silverberg, who at the time headed the company's Internet group. In his written testimony, Warren-Boulton quotes part of a deposition by Silverberg in which he admits he told negotiators from AT&T that the company would "have to do something very special" in return for its WorldNet online service being placed on the Windows desktop. The "very special" concession, Warren-Boulton contends, was an agreement not to distribute Netscape's competing Navigator browser.
But according to the deposition, Silverberg also testified that the AT&T negotiator, Tom Evslin, was "very obnoxious" during the negotiations, pounding his fists on a table while repeatedly demanding that the icon for his online service be placed on the Windows desktop.
Silverberg testified he was only taking "an extreme position in the other direction," according to the deposition. Lacovara chided Warren-Boulton for not including that context in his testimony.
Warren-Boulton, however, said he faithfully represented Silverberg's comments.