MS/DOJ: Compaq's Rose denies MS limits

Testimony in the defense of the U.S. government's antitrust suit against Microsoft Corp. continued today, as Microsoft released the written testimony of Compaq Computer Corp. executive John Rose. Rose is senior vice president and group general manager of the company's Enterprise Computing Group.

Testimony in the defense of the U.S. government's antitrust suit against Microsoft Corp. continued today, as Microsoft released the written testimony of Compaq Computer Corp. executive John Rose.

Rose is senior vice president and group general manager of the company's Enterprise Computing Group.

The government maintains that Microsoft used its monopoly power in the operating system market to hurt Netscape Communications Corp.'s ability to distribute its browser. Managing Compaq's relationship with Microsoft is one of Rose's responsibilities, and Rose noted that Microsoft is certainly key to Compaq's business: since 1993 Compaq has not consistently loaded any alternatives to Microsoft's Windows OS on PCs it markets to consumers, Rose said in his statement. However, Compaq was never pressured to exclude Netscape's browser from Compaq's PCs, the statement said.

"Microsoft in no way limits Compaq in its license agreements or OPK [OEM Preinstallation Kit] from including Netscape's icon," Rose said in the statement.

A 1996 dispute between Microsoft and Compaq may give the appearance that Microsoft bullied Compaq to restore Microsoft's Internet Explorer browser icon on some of Compaq's consumer desktops, but in fact that Microsoft was within its contractual rights to demand the restoration, and did not request or require Compaq to block other companies' browsers, according to Rose's statement.

In early 1996, Compaq removed the Internet Explorer icon, though not the software itself, from the Windows 95 default desktop on its Presario line of PCs, Rose's witness testimony states. Users could still access Internet Explorer through the start menu, but the icon was taken off the default desktop because of Compaq's agreement with America Online Inc. (AOL) to position AOL as Compaq's "featured online service provider," Rose's statement said. Microsoft responded by sending Compaq a letter which said that removal of its icon was a violation of Compaq's license agreements with Microsoft, and Microsoft announced its intent to terminate Compaq's license agreements, according to Rose's statement.

Microsoft's letter was the first Rose learned of the removal of Microsoft's icons, including Microsoft's MSN icon, from the default desktops, and the removal was incompatible with Rose's agreement with Microsoft, he said in the statement.

"In my view, the removal of the Microsoft icons was contrary to an understanding I had reached with Microsoft in August 1995," Rose said in his statement.

That understanding was that Compaq "would not replace or modify the OPK install process in any way," but the agreement did not include any understanding about Netscape's Navigator, according to Rose's witness statement.

"Microsoft in no way limits Compaq in its license agreements or OPK from including Netscape's icon," Rose's statement said. "Compaq did not agree as part of any agreement with Microsoft not to include a Netscape Navigator icon on the desktop of its Presario line of computers."

Rose also expressed support for Microsoft's contention that Internet browsing has evolved to be a basic function of an operating system, rather than a function properly delivered by separate software.

"Consumers expect new PCs, or upgraded operating systems, to take care of basic functions without requiring the purchase of extra software," Rose said in his statement. "The displaying of Web-type content, which is what browsers do, is now a basic function that people expect from PCs."

Compaq, in Houston, Texas, can be reached at +1-281-370-0670 or on the World Wide Web at http://www.compaq.com/.

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