Microsoft trial: MS email and Fisher testimony

The U.S. Department of Justice (DOJ) released email evidence Wednesdayshowing that Microsoft began fearing competition from cross-platform solutions such as Java a few years ago. One telling email, sent from Microsoft VP Jim Allchin to CEO Bill Gates is titled "Losing a Franchise:The Microsoft Windows Story (a new Harvard Case study)." In it, Allchinpaints a possible future where Windows is made irrelevant by competition.

"I'm sure this subject got your attention," Allchin writes in the February1997 email. "It's what I worry about. The cross-platform vision and keepingWindows as the platform and the center of innovation fall into this category. In my opinion, Windows is in the process of being exterminatedhere at Microsoft. I assume the argument is that we have to do things cross-platform because Netscape is (or says they will). So, we move our innovations cross-platform and dilute Windows. The alternative is to say 'NO' and push even harder on Windows."

At the time, Internet Explorer was heavily integrated with Windows as itis in Windows 98 and Windows 2000. Allchin apparently has the genesis of aplan to get IE integrated into Windows, at the expense of cross-platformversions of IE.

"I consider this cross-platform issue a disease within Microsoft," hewrites.

The Gates response: "I can say I am more scared than you are, but that isnot what will help us figure out where we should go."

Meanwhile, the final government witness, economist and MIT educator Franklin Fisher, took the stand today. Fisher immediately found himself onthe receiving end of a rebuttal by Microsoft attorney Michael Lacovara,who questioned everything from the amount of time Fisher spent preparingfor the trial (30 hours at $500 an hour) to Fisher's credibility as anexpert witness (two previous court decisions have criticized Fisher forbeing only remotely familiar with the facts in the case).

Once Microsoft is done cross-examining Fisher, the company will ask thecourt to throw out the case. When that fails (let's face it, the judge isn't exactly open to Microsoft's point of view here), Microsoft will present its first witness, Richard Schmalensee, the interim dean of the Sloan School of Management at MIT, a former student of Fisher's