[Fwd: [WNCLUG] Minnesota class-action against M$]

[Joe]

For all the M$ fans out there, the soap opera continues:

Joe

-------- Original Message --------
Subject: 	[WNCLUG] Minnesota class-action against M$
Date: 	Wed, 07 Apr 2004 21:01:16 -0400
From: 	Roy Pittman <mlxpzy at bellsouth.net>
Reply-To: 	WNC Linux User's Group <wnclug at main.nc.us>
To: 	wncLUG <wnclug at wnclug.org>



Newly Released Documents Shed Light on Microsoft Tactics

March 24, 2004
By JOHN MARKOFF (the New York Times)

Even as Microsoft prepares to face penalties from the
European Union, which accuses the company of abusing the Windows
monopoly, new details about the tactics Microsoft used to secure a
dominant position in software markets for nearly two decades are
emerging in a state courthouse in Minneapolis.

Testimony during the second week of trial in the consumer class-action
lawsuit in Minnesota has revealed some embarrassing internal documents
from Microsoft which were not disclosed in the bitter 1997 federal
antitrust lawsuit that focused on the company's attempt to control the
browser markets in the 1990's.

Among the documents introduced in court this week was a
letter from June 1990 in which Bill Gates, Microsoft's chairman, told
Andrew S. Grove, the chief executive of Intel at the time, that any
support given to the Go Corporation, a Silicon Valley software company,
would be considered an aggressive move against Microsoft.

Other evidence presented by the plaintiffs' lawyers at
trial yesterday gave an account of how Microsoft violated a signed
secrecy agreement with Go and showed that Microsoft possessed technical
documents from Go that it should not have had access to.

A Microsoft spokeswoman said that many of these newly
disclosed documents were not relevant to the trial, which focuses on
Microsoft pricing actions.

"These are very old documents, taken out of context for the sole purpose
of obscuring the real issue of this case," said Stacy Drake, the
Microsoft spokeswoman.

But lawyers for the plaintiffs contend that the documents
show how Microsoft unfairly dominated the market. "All of Microsoft's
conduct was designed to acquire and hang on to their monopoly,'' said
Eugene Crew, a lawyer at Townsend, Townsend & Crew, based in San
Francisco. "Consumers were harmed by being deprived of choice. The
greatest harm out of the Go story was the suppression of innovation and
new technology by Microsoft."

Microsoft has already paid $1.6 billion in its efforts to settle
consumer antitrust claims filed in 10 states.

The new lawsuit, which contends that Microsoft overcharged Minnesota
customers from 1994 to 2001, seeks almost $500 million from the company.
If the company, based in Redmond, Wash., loses, it could also be forced
to pay triple that amount under Minnesota state law.

This week, the lawyers representing the Minnesota consumers
are focusing on Microsoft's efforts to undercut Go, a
start-up company that was developing an operating system
for hand-held computers.

The first witness appearing at the trial yesterday was
Jerry Kaplan, the co-founder of Go. Mr. Kaplan, who was a software
developer at the Lotus Development Corporation before he started Go, has
been a longtime opponent of Microsoft.

Yet he said he was surprised by what was revealed about Microsoft's
activities in the documents. "I was shocked," Mr. Kaplan said in a
telephone interview. "This was a corporate mugging that went uncorrected
and unknown."

The events surrounding the failure of Go have often been
cited as a reason for the animosity between Silicon Valley executives
and Microsoft. Go was one of the most prominent efforts by Silicon
Valley entrepreneurs and venture capitalists to create software for
tablet-sized devices. In addition to an all-star cast of technologists,
the start-up had backing from major industry players like I.B.M., Intel
and AT&T.

The plaintiffs contend the new documents show that
Microsoft violated nondisclosure agreements with Go, and
then used that information to build PenWindows, a
competitor to Go's PenPoint operating system. The documents included
Microsoft's internal e-mail messages showing that it had detailed
knowledge of Go's product plans.

The documents also suggest that Microsoft sought to
pressure Intel to cancel its plans to invest in Go. On June
28, 1990, Mr. Gates wrote a letter to Mr. Grove trying to convince the
Intel executive that he should back a version of Windows for portable
computers, then code-named Windows-H, rather than Go's PenPoint
software.

"I guess I've made it very clear that we view an Intel investment in Go
as an anti-Microsoft move, both because Go competes with our systems
software and because we think it will weaken the 386 PC standard," Mr.
Gates wrote.

Shortly after the letter was written, according to Mr.
Kaplan, Intel reduced its planned investment in Go from $10 million to
$2 million, and stipulated the investment be kept a secret.

An Intel spokesman declined to comment on the events.


Silicon Valley executives said that Microsoft's aggressive behavior in
the early 1990's led to a widespread belief among technology companies
that Microsoft was using its operating system monopoly and unfair
tactics to compete in markets where its technology was inferior.

Microsoft was well aware of this perception, and in 1991
tried to alter the way the company was viewed.

In a document titled "Microsoft Criticism," the company's outside public
relations consultants recommended training for its executives on
"personal demeanor and style." The advice read in part that the focus
should be shifted from "killing the competitor" to "providing a better
solution to the customer's problems."

"It's a bit of artifact, but in its day it was a good
memo," said Marianne Allison, an executive at Waggner
Edstrom, Microsoft's longtime public relations firm.

In late 1993, Go was sold to AT&T where it was ultimately merged into
the company's portable computer subsidiary. In 1994 the phone company
shut down the effort in portable computing. Three months later Microsoft
canceled its PenWindows project.

In 1996, Mr. Kaplan wrote a book, "Start-Up: A Silicon
Valley Adventure" (Penguin USA), in which he blamed
Microsoft, in part, for the demise of Go. Two years later, Marlin Eller,
a former Microsoft programmer who was part of the PenWindows project,
wrote in "Barbarians Led by Bill Gates" (Owl Books) that the intent of
the PenWindows project had been primarily to undermine Go.

http://www.nytimes.com/2004/03/24/technology/24soft.html?ex=1081153675&e <http://www.nytimes.com/2004/03/24/technology/24soft.html?ex=1081153675&e>
i=1&en=2678b1c0ad0a282e





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