An account of the landmark antitrust case chronicles the investigation of Microsoft, examines the key events and personalities of the trial, and discusses the impact of the verdict.
It had been a brisk, even perfunctory, courtroom session. On August 21, 1995, Microsoft's tall, silver-haired general counsel, known for his bow ties and aristocratic reserve, was almost visibly gloating. After a long investigation into Microsoft's business practices, he stood on the courthouse steps and declared, "At the end of five years, we were willing to accommodate the government on some licensing matters, and the rest of our practices apparently passed muster." For Microsoft, this was a moment to enjoy, having swatted aside a government challenge to its way of doing business. For the government, it was a hard lesson learned. It was not that Microsoft's business practices had passed muster. Far from it. It came down to not acting quickly enough in the fast-paced world of high technology. But the battle was just beginning. On June 23, 1995, the Justice Department had received a letter from Netscape's outside counsel, Gary L. Reback, sent two days after a Netscape-Microsoft meeting. The letter, which recounted verbal exchanges and events that took place at the meeting, pointed toward violations of the Sherman Antitrust Act. At first, the Justice Department did not grasp the significance of the meeting. But it would prove to be the starting point in the narrative of the government's case. According to Reback's letter, Microsoft had made Netscape an all-or-nothing offer: Microsoft would not give Netscape the technology plumbing in Windows unless the software giant received an equity interest in Netscape, a seat on Netscape's Board of Directors, and otherwise controlled Netscape's ability to compete against Microsoft. The Netscape-Microsoft meeting and Reback's letter led to the most watched antitrust trial of the century, and the first real test of the century-old doctrine of antitrust in the information age. In a trial that captured the world's attention like no other legal battle in recent corporate history, the government alleged that when Netscape rebuffed Microsoft's proposal, the software giant used every bit of its market muscle to stifle the challenge, crush Netscape, and thus protect its monopoly. Microsoft, the government said, then pressured the entire industry–including Compaq, America Online, Apple, Intel, and IBM– to step back from supporting Netscape and from competing with Microsoft in any significant way. The Government's relentless attack on Microsoft portrayed America's most successful company as a predatory monopolist that bullied both its partners and its rivals in the industry. Yet beyond tarnishing Microsoft's reputation, the case had legal implications for everything from electronic commerce to network communications and had successfully posed one enduring question: What are the appropriate legal restraints on the behavior of a powerful company in a dynamic, high-technology industry? Now, New York Times reporters Joel Brinkley and Steve Lohr, who have watched the drama unfold in Washington and in Silicon Valley since before the trial began, give a detailed, richly-textured account of the landmark case--and put the important issues into perspective as only The New York Times can do.
About the Authors
New York Times correspondents Joel Brinkley and Steve Lohr have been covering the case since before the trial even began, down to its repercussions after it all was over. Steve Lohr has been a technology reporter at The New York Times since 1992. Previously, he was The New York Times bureau chief in Manila, a correspondent for the London bureau, and deputy editor of The Times' business news department. Joel Brinkley is a Washington correspondent for The New York Times covering regulatory issues. Previously, he was The Times' bureau chief in Jerusalem, and the White House Correspondent. A 1980 Pulitzer Prize winner for international reporting, Mr. Brinkley is also the author of The Circus Master's Mission and Defining Vision: The Battle for the Future of Television. Joel Brinkley lives in Washington, D.C. and Steve Lohr lives in New York City.
As the powerhouse of personal computing, Microsoft has grown faster and touched more lives than just about any other company in recent memory. Guided by its brilliant, driven leader, Bill Gates, the software giant has been dogged by its share of competitors over the years. But no other business rivalry captured the public imagination quite like the one between Netscape and Microsoft. When Judge Thomas Penfield Jackson sided with the government and ruled Microsoft guilty of violating antitrust laws with predatory behavior, shock waves were sent across the country causing record-breaking drops in the Nasdaq, wiping out billions in paper-wealth for Microsoft, and, overall, battering technology-shares across the board. From its earliest pre-trial stages including Microsoft's all or nothing offer to Netscape to divvy up the browser market, to testimony from senior executives of America Online, Apple, Intel, and more, all the way to the dramatic final outcome, U.S. v. Microsoft is a riveting account of the first major antitrust case of the Information Age. Two reporters from The New York Times, Joel Brinkley and Steve Lohr, tell the story of the trial--the charges, the fiery e-mails, the dramatic courtroom confrontations. But they also profile the personalities in a trial that revealed the inner workings of the most powerful company in modern business. Beginning with day one of the trial– U.S. v. Microsoft provides an eyewitness account of how the Internet drama unfolded. Readers will find:
* Fascinating, behind-the-scenes information that sets the stage for the infamous "play"–beginning with the swarms of curious spectators lining up outside the Federal courthouse on day one of the trial, October 20, 1998
* Face-to-face meetings with the entire cast of characters, including Microsoft executives, Judge Thomas Penfield Jackson, and David Boies and Joel Klein for the government
* Intriguing, first-hand observations
* Expert analysis of the implications of this battle--and what it means to the entire Internet industry.
U.S. v. Microsoft provides the gripping account--with many new behind-the-scenes details--of the first major antitrust trial of the Information Age.
