An increasingly agitated Jim Barksdale, the CEO of Netscape, faced a second grueling day in court on Wednesday as Microsoft attorney John Warden attempted to cast doubt on his credibility. Warden moved through Barksdale's 127 page written testimony one agonizing page at a time, questioning nearly every single statement in it. Most damaging for Barksdale, however, and for Netscape in general, was the revelation that it was Netscape, not Microsoft, that originated a plan to have the software giant invest in the little browser maker.
Warden demonstrated that Netscape approached Microsoft via email in December 1994, asking the Redmond-based company to invest in an equity stake in their company and cooperate with them in the browser market. Netscape and the DOJ have alleged that it was Microsoft that attempted to reach a collusion with Netscape and divide up the browser market in a June 1995 meeting. In fact, this is a central point of the case against Microsoft. The email, sent by Netscape's Jim Clark to Microsoft's Dan Rosen, requested that Microsoft use their Navigator browser instead of Spyglass' Mosaic as the basis for the Internet Explorer browser Microsoft was then developing.
"I'd like to convince you to reconsider using our Netscape client and apologize for the miscommunication with \[Netscape's\] Paul Koontz," Clark wrote. "I was not aware of the details of his interaction with you, or I would have expressed things differently. Microsoft is the de facto client software company and we have never planned to compete with you so we have never considered a client as being our business. Our business is adding value on the back end in the form of vertical applications currently using Oracle databases."
The most damning comment, however, is the following suggestion that the two companies work together. Closely together.
"We want to make this company a success but not at Microsoft's expense; we'd like to work with you," Clark wrote. "Working together could be in your self-interest as well as ours. Depending on the interest level, you might take an equity position in Netscape with the ability to expand that position later."
Microsoft rejected Clark's offer.
Barksdale said that the idea of the two companies dividing the market never came up, though he felt that the threat to collude was "implicit." This changes the story dramatically, since Barksdale has always said that Microsoft explicitly offered to divide the browser market with Netscape.
Warden also revealed that Netscape co-founder Jim Clark knew of Microsoft's plans to integrate Internet Explorer into Windows as early as October 1994 because he attended a Bill Gates speech where this was revealed. Barksdale, however, says Netscape knew nothing of that until late 1995.
"I decided to give \[Navigator\] away free because Bill Gates told me he was going to give \[Internet Explorer\] away free before our first beta and I felt like we would have to in order to survive against Microsoft," Jim Clark said.
Barksdale grew increasingly irritated over the course of the day. Barksdale, who is known for his down-home Louisiana style of speech, frequently answered direct questions with vague or meaningless anecdotes, such as, "if it walks like a duck and quacks like a duck, it is a duck." Warden, who is painstakingly--and, perhaps, irritatingly--going through Barksdale's written testimony line by line, only reached page 24 of the 127 page document when day three ended. He pledges to continue this way to the bitter end and "we're not skipping \[anything\] in between," he said to a grumbling courtroom.
Warden also forced the belligerent Barksdale to admit that Netscape had earned more money each year since its founding despite competition from Microsoft. Also, Netscape expects to have distributed its browser to over 68 million people by the end of 1998 and the company has deals with over 7000 partners, 4300 ISPs, 520 hardware manufacturers, and 1500 content providers. And Netscape's browser, though it no longer controls 85% of the market as it did in 1995, still commands a lead over Internet Explorer, despite the fact that IE has been bundled with Windows for over a year. It's hardly the kind of business that needs to be bailed out by the government.
If Jim Barksdale ever gets off the stand, Apple Computer's Avie Tevanian is due up next. Barksdale will be called before the court again tomorrow, and his continuing cross-examination is expected to take at least all of Thursday if not the rest of the week
