The decision came from the top: Bill Gates himself decided that companies hankering for space on the Windows desktop would have to promote Internet Explorer and drop Netscape, a Microsoft executive testified Monday.
"The top-level, platinum-level partners ... would be promoting Internet Explorer preferentially to Netscape Navigator and other leading browsers," William Poole, senior director of business development, said during cross-examination in the antitrust trial.
A government attorney referred to earlier testimony by Intuit CEO William Harris, a government witness who had claimed he had to bow to Microsoft's wishes if he wanted to place Quicken 98's icon on the Active Desktop.
For a window onto the Microsoft antitrust trial, visit US v. Microsoft. - - - - - -
"[Intuit] had to agree to limit what they could do with Netscape, correct?" Justice Department attorney David Boies asked.
"Correct," Poole replied.
Chairman Gates set the "high-level message" and was not directly involved in negotiations with Intuit, Poole said.
Contracts restricting one firm's ability to work with others are commonplace in the software industry, a point that Poole repeatedly stressed during two hours of tense sparring with Boies on Monday. Poole said America Online had "entered into 40 agreements that were labeled as exclusive."
Intuit ended up signing a contract requiring it to maintain an arms-length relationship with Netscape by promoting "Microsoft Internet Explorer to the express exclusion of Netscape Navigator," Harris said in October. It allowed Intuit to distribute Navigator but not to make any money from the arrangement.
"What certain restrictions did Mr. Gates mandate?" Boies asked.
"He didn't mandate details," Poole replied.
"Who's he?" US District Judge Thomas Penfield Jackson interjected.
"I'm sorry. Bill Gates," Poole said.
Allegations that Microsoft (MSFT) unfairly wielded its operating system muscle to hurt Netscape are a key part of the Department of Justice's lawsuit against the company.
Microsoft strongly denies the charges. "Exclusive cross-promotional, cross-marketing agreements are common in the software industry," spokesman Mark Murray said during a lunch break.
Also on Monday, Microsoft released the written testimony of its next witness, Cameron Myhrvold. The 37-year-old brother of fellow Microsoft executive Nathan Myhrvold is a vice president of the company's Internet consumer unit.
His 57-page direct testimony focuses on Microsoft's relationships with Internet service providers. Cameron Myhrvold testified that Microsoft's agreements with ISPs did not bar them from shipping Navigator and the company voluntarily waived some controversial portions of the contracts in April 1998.
