MS trial: AOL a threat, says Microsoft

On Monday, Microsoft attempted to show the judge in its antitrust trial that America Online (AOL), which purchased Netscape Communications earlier this year, is a competitive threat that makes the government's case pointless. The heart of the government's case centers around Netscape, which saw the business for its once mighty Web browser falter when Microsoft released its Internet Explorer browser for free. The government alleges that Microsoft used anti-competitive practices to gain marketshare, effectively locking Netscape out of the market.

To bolster its defense, Microsoft called AOL executive David Colburn as a hostile witness. Colburn testified that AOL considered swapping out Microsoft's IE technology, which is used in AOL's Windows software, for Netscape Navigator but didn't do so because of "public relations concerns."

Microsoft attorney John Warden then presented an email message from AOL CEO Steve Case.

"My main point is we shouldn't assume we need or want to maintain IE as \[the\] primary browser," Case wrote. "Maybe that's the right answer, but maybe not--we should push down on all possibilities before deciding."

AOL President Bob Pittman answered Case's email with his own message.

"I do think \[Microsoft\] is too strong to throw them out of the tent," he wrote. "They can hurt us if they think they have no other option. I think we need to stay in business with them, create a need for them to need us and then leave ourselves the flexibility to always accommodate them to a certain extent."

Government attorneys argue that AOL is no threat to Windows because they don't sell an operating system. Warden says that AOL is a threat to Microsoft because its software is a "platform" that could someday compete with Windows

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