COURT NOTES: After Microsoft's experience in court the previous week, most people felt that their case couldn't get any weaker. Those people were proven were proven wrong the first day when Microsoft executive William Poole admitted to one of the DOJ's core charges against his employer, acknowledging that Microsoft bribed companies with listings on the ActiveDesktop Channel Bar to stop promoting and distributing Netscape products. One piece of evidence produced was an e-mail from Bill Gates, saying that he would be willing to do Intuit a "favor" costing around a million dollars in exchange for a version of Quicken requiring IE instead of Netscape Navigator. Poole spent the next day and a half unsucessfully trying to defend the wording of that message.
After Poole's testimony, Microsoft's lawyers played yet another video for the court in an attempt to show some speed advantages of integrating Internet Explorer with Windows 98. However - instead of showing Windows 98 with and without IE, or comparing 98 to a version of 95 without Explorer - Microsoft compared Windows 98 to elderly Windows 3.1. The executive shown on tape said that installing a web browser and getting online takes an additional 14 minutes more than with an integrated browser. But when David Boies questioned Ms executive Cameron Myrhvold about the modems used for the test, he admitted that the Windows 98 system was using a 33.6K modem, while the PC running Windows 3.1 only had a 28.8. Myhrvold downplayed the differences in modem speed, saying that the main issue is the amount of time spent installing software, not the time it takes to connect and download it.
Myrhvold further cemented the government's case against Microsoft when he admitted that IE had no chance when evenly pitted against Netscape. The witness said Microsoft was concerned that Netscape products would win side-by-side comparisons against Explorer because of Netscape's name recognition. Since Microsoft was late getting to the internet, they felt the only way to gain in that market was to prevent ISPs from distributing Netscape more than Explorer.
Thursday began with still another Microsoft video, this one showing how easy it is to download and install Netscape Navigator on a Windows 98 system. Microsoft's attorneys showed that the video had been edited to make the wait shorter and explained the amount of time that had elapsed. But when Microsoft Vice President Brad Chase took the stand, Boies asked him if the 10MBPS connection speed in Microsoft's video really showed a typical user experience. Chase disputed that, and said no matter what the connection speed, millions of people download browsers all the time. That prompted Boies to produce e-mail from another Microsoft employee saying that most people _aren't_ willing to spend two hours downloading a browser when one is already available on their computer. Boies then asked permission to introduce a tape of his own, showing what _really_ happens when you download and install a web browser.
After Judge Jackson closed the court to allow Microsoft attorneys a chance to preview the tape, everyone agreed to play the video publicly next Tuesday when court resumes after a US holday.

According to several reports, Microsoft is planning yet another internal reorganization - this one involving the whole company. After the shuffling, which could be announced as soon as next week, Microsoft will be divided into four groups oriented towards the enterprise, consumers, developers and knowledge workers. Microsoft is currently organized by product categories like Operating Systems and Applications. Ousted executive Brad Silverberg has also reportedly been asked to return to Microsoft and head up the consumers group. This latest reorganization has apparently been pushed by Microsoft president Steve Ballmer, who took over the #2 executive spot (under BillG) last summer [see NewsSource, July 27 '98].

It was announced Friday that Microsoft's Slate e-zine will be dropping its $19.95 yearly subscription fee, effective immediately. Slate adopted the subscription model almost a year ago, limiting the liberalized news magazine's content to only the people willing to pay for it. And since nearly everything else on the web is free, Slate has lost money hand over fist ever since. Newly appointed publisher Scott Moore (the previous publisher is now in charge of marketing Windows CE) said that the site will be supported with ad sales, but noted that a subscription service will still be available for those customers wanting premium services like email delivery, a print edition and access to the Slate archives. Subscribers who opt out of the extra features will recieve a refund. This new plan may finally get Slate more subscribers than this newsletter has...

Internet gambling has the potential to become a multi-billion dollar industry, but it is currently against the law in most US states. The law, however, hasn't stopped Microsoft from throwing its weight into the industry, with sources revealing last week that Australia's Publishing & Broadcasting may be teaming up with Microsoft to produce an online casino. P&B owns part of NineMSN - the Australian version of the Microsoft Network - and is buying the only licensed casino in Melbourne. Publishing & Broadcasting has already shown its investors several internet casino proposals, and NineMSN owns the rights to any P&B internet content, so any internet gambling sites set up by the communications company would appear under NineMSN's brand name. None of the companies involved would confirm or deny the reports.

Last week Microsoft launched a new advertising campaign for the MSN.com web portal. The new campaign involving magazines, newspapers, radio, billboards and internet ads uses Microsoft's famous "Where do you want to go today?" slogan. This is the first major ad campaign for MSN.com since all of Microsoft sites were rolled into one cobranded group last August. The current ads are expected to run through June.

Dealing another blow to Windows NT sales, IBM is expected to join Dell and Hewlett-Packard in offering Linux as an option on its highend PC servers. Reports say that the computer manufacturer will be anouncing an alliance with LinuxPPC and Red Hat Software on March 1. We're also getting reports that IBM's Lotus subsidary will begin making products for Linux around the same time.
Microsoft corrected more compatability problems on its Y2K site last week. The new problem affected Netscape Communicator, preventing the browser from seeing all of a framed page. An earlier bug the week before [see NewsSource last week] blocked Communicator users from ordering a Y2K test CD from Microsoft.
Also last week, Microsoft announced that it has sold more than 25 million licenses for Windows 98. A spokesperson also said that a record 3 million copies of Window 98 were sold during the Christmas shopping season.

_{Microsoft ends Office 2000 giveaway
'Baby Bills' Coming?
Microsoft test drives new IE features
Lemon Dog v Microsoft
Bug accompanies Microsoft release of SMS}