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IBM exec: Microsoft threatened to withhold Windows

The software giant reportedly told IBM that Windows licensing depended on the giant PC maker's withdrawing support for rival software products.

Microsoft reportedly told IBM that Windows licensing depended on the giant PC maker's withdrawing support for rival software products, an IBM executive will testify tomorrow.

Garry Norris, Microsoft's day in court IBM's former director of software strategy and strategic relations, will charge that Microsoft threatened to withhold its operating system software in a deposition to be given in advance of his expected antitrust trial appearance next month, according to published reports.

Microsoft objected to IBM's support for Netscape's Navigator, Lotus Notes, and other software, according to Norris, who negotiated Windows licensing from 1995 to 1997. Joachim Kempin, who handled negotiations for Microsoft, underscored the company's intentions by allegedly telling Norris that "You can buy it at retail," according to the Seattle Times.

Even a dollar or two more in the price IBM paid for each copy of Windows would have totaled millions of dollars, and the threat of withholding the software entirely would have been all but unthinkable to a major PC maker.

Norris's testimony would be among the first instances of a major PC maker's confirming the government's key contention that Microsoft brandished its monopoly power in the market for operating system software. Windows powers about nine of ten PCs, and the government and 19 states allege that Microsoft illegally wielded its dominant position to crush competition in the Web browser market.

Microsoft is expected to contend that the negotiations were tough but not illegal, the Seattle Times said, and that Norris may have had cause to embellish Microsoft's stance to make up for internal pressures at IBM over failing to come up with a better deal.

Microsoft could not immediately be reached for comment, but a company spokesman told the Wall Street Journal that "The bottom line is that Microsoft did license Windows 95 to IBM at a competitive price and IBM continued to ship lots of competitor products right alongside Windows on their machines."

The Journal also reported Norris kept a notebook detailed Microsoft's threats, and that the notebook will be produced as evidence.

Earlier in the antitrust trial, Compaq executives detailed Microsoft moves to remove Netscape's Navigator from the desktop, but stopped short of calling Microsoft's position a threat.