Microsoft Corp.'s group vice president for platforms and applications, Paul Maritz, yesterday became the software giant's first employee to take the witness stand in its defense against the U.S. government's antitrust allegations.
During yesterday's session of the antitrust trial pitting the U.S. Department of Justice (DOJ) against Microsoft, lead government attorney David Boies quizzed Maritz about details of the US$150 million that Microsoft invested in Apple Computer Inc. in 1997.
In their broad antitrust case, the U.S. Department of Justice and 19 states are charging Microsoft with using its alleged Windows monopoly in the desktop operating system market to damage competition. The government is also charging that Microsoft tried to force Apple to use the Microsoft Internet Explorer (IE) browser instead of Netscape Communications Corp.'s Navigator by threatening Apple with discontinuing the development of the Macintosh version of Microsoft Office and by investing in Apple.
Boies asked Maritz whether a big motivation behind Microsoft's 1997 investment in Apple was to get Apple to use Microsoft's Internet Explorer browser rather than Netscape Communications Corp.'s browser.
"We were concerned about getting our share (for browsers) up. Out of necessity it would have to come by persuading our customers to use our platforms as opposed to someone else's," acknowledged Maritz, who also added: "I was aware that Netscape was our principal competitor."
But Maritz said that Microsoft's main concern was getting Apple to drop a patent dispute it had with Microsoft.
Boies, however, tried to show that the browser issue was in fact a major one for Microsoft, by presenting a 1996 e-mail from Microsoft CEO and Chairman Bill Gates to Maritz, which read in part: "I have two key goals in the Apple relationship -- 1, maintain our application share on the platform and 2, see if we could get them to embrace Internet Explorer in some way ... it would require some real effort to get a deal but I think it is possible."
Maritz pointed out however, that his job is to oversee application issues, not legal matters. So, Maritz said, it was only natural that Gates -- even though his main concern was the patent dispute -- focus on the application and browser issues in the e-mail, since the e-mail was addressed specifically to him.
In his written testimony, released Friday, Maritz said that Microsoft has not tried to intimidate rivals, and that Apple's claims that Microsoft sabotaged its QuickTime multimedia player are "insulting."
Microsoft's first witness, Richard Schmalensee, dean of the Sloan School of Management at the Massachusetts Institute of Technology, finished his testimony earlier today in a closed-door court session in which the sides examined Windows pricing information.
The government examined Windows pricing data with its own economic expert earlier in the trial, and used the information to try to prove its allegation that Microsoft has monopoly control of operating system pricing. At the request of Microsoft and the PC manufacturers, details of the pricing data, and the trial sessions in which they are examined, have been closed to the public -- though the main issues relating to the data have been argued in open court.