Myhrvold: Microsoft feared Netscape

Microsoft was afraid consumers would choose Netscape's browser over its own if users were presented with both, a company executive testified at the Microsoft antitrust trial yesterday.

During his second day on the stand, Microsoft Internet Customer Unit Vice President Cameron Myhrvold acknowledged his company struck deals with ISPs that contained restrictions on shipping Netscape's Navigator because, at the time, Microsoft was afraid of losing the browser battle.

"We were nowhere, we were the Johnny-come-lately to the Internet," Myhrvold told DOJ attorney David Boies. "We were concerned that it wouldn't help distribute IE," Myhrvold said of allowing Internet service providers to ship Netscape without restrictions.

But Boies replied that Microsoft was worried about more than that. "You were concerned if you presented users with a choice, side by side, they would pick Netscape's browser rather than yours," he said.

"That's right," Myhrvold said.

Microsoft executives previously have testified that consumers would choose IE even if Navigator were widely shipped because of its superior technology. Myhrvold made the admission Microsoft feared Netscape Tuesday morning after Boies presented a string of e-mails contradicting the witnesses' answers to previous questions.

Boies succeeded in wearing down Myhrvold by quizzing him about various deals Microsoft had with service providers and then challenging his answers with internal company memos.

Boies asked Myhrvold if Microsoft had told ISP AT&T that it would have to give very preferential or exclusive treatment to IE if it wanted to remain one of the recommended Internet providers accessed through a dialogue box on the desktop.

Myhrvold answered that it had not.

Boies then pulled out an e-mail from Microsoft executive Brad Silverberg addressed to Myhrvold and others, saying Microsoft had told AT&T executives it would accept nothing less than extremely preferential treatment of IE over Navigator. "Parity is completely unacceptable for them to be in the box," Silverberg wrote.

Earlier in the morning, Boies produced a Microsoft chart sent to Myhrvold, showing that IE browser use increased sixfold between the third quarters of 1997 and 1998. A line ran from the numbers down to a box at the bottom of the chart, reading "AOL force fed the browser to subscriber base."

Myhrvold said he did not know what the term "force fed" meant. "AOL is not my area of specialty," Myhrvold said.