Microsoft probe expands

[Mitch Stone <mstone@vc.net>]

http://cnnfn.com/digitaljam/9807/23/microsoft/

                                               [Y; Why it Matters]
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 [digital jam]

                         Microsoft probe expands

                         Justice Department reportedly investigating
[graphic]                multimedia dealings

                         July 23, 1998: 7:30 a.m. ET

                NEW YORK (CNNfn) - Federal prosecutors
                are reportedly investigating whether
                Microsoft Corp. is using illegal tactics
                to monopolize the multimedia-software
                market.
                [Image] Lawyers and industry executives
                familiar with the investigation told the
                Wall Street Journal that investigators
                are examining whether Microsoft tried to
                persuade Apple Computer Inc. (AAPL) to
                stay out of the broad consumer market
                for multimedia software.
                [Image] That echoes a charge in the
                government's pending antitrust lawsuit
                against Microsoft that it tried to carve
                up the Internet-browser market with
                Netscape Communications Corp. (NSCP)
                That case goes to trial Sept. 8.
                [Image] Sources told the Journal the
                Justice Department is studying
                information obtained from Apple
                indicating that Microsoft executives
                proposed three times -- most recently in
                March -- that Apple retreat from its
                plans for the Windows multimedia market
                and leave that field to Microsoft, in
                exchange for an endorsement of Apple
                software tools.
                [Image] Apple rejected the proposal,
                according to the sources.
                [Image] Also reportedly under scrutiny
                is whether onscreen error messages or
                other technical incompatibilities in
                Microsoft's Windows operating system or
                browser software were intended to thwart
                Apple and other rivals; whether
                Microsoft pressured major
                personal-computer makers to drop Apple's
                video software; and whether agreements
                the company has struck with
                video-programming providers were
                exclusionary.
                [Image] A Microsoft spokesman rejected
                the charges, saying the companies have
                worked together to make their
                multimedia-software packages more
                compatible. Spokeswomen for Apple and
                the Justice Department declined comment
                to the Journal.
                [Image] The investigation comes at time
                when Apple's Interim Chief Executive
                Officer Steve Jobs has sought a closer
                relationship with its one-time arch
                rival. Last year, Microsoft took a $150
                million non-voting stake in Apple and
                paid an estimated $100 million more for
                access to its patents.
                [Image] The two companies are also
                combining their Java programming
                language technologies to create a single
                Java platform for the Mac.
                [Image] Justice Department officials
                have previously said they are examining
                terms of that agreement to determine if
                it is anti-competitive.
                [Image] The Journal said the Justice
                Department is also investigating
                Microsoft's behavior toward RealNetworks
                Inc. (RNWK), the leader in a key
                multimedia-software technology known as
                video streaming.
                [Image] The company last fall was
   [Image]      ordered by investigators to provide
                documents and was visited most recently
                by a Justice Department team "four or
      [Image]   five weeks ago," Bruce Jacobsen,
                RealNetworks president, told the paper.
         Three  [Image] A year ago, RealNetworks
 senators come  licensed some of its technology to
            to  Microsoft after selling Microsoft a
   Microsoft's  10-percent stake in the company.
     defense -  [Image] Microsoft makes the NetShow
 July 15, 1998
                streaming software, a direct competitor
                to RealNetworks' RealPlayer.
    Sen. Orrin  [Image] But RealNetworks' relationship
         Hatch  with the software giant has become
    challenges  strained: Its chief executive, Robert
   Microsoft -  Glaser, is set to testify Thursday at a
 June 26, 1998  Senate Judiciary Committee hearing
                examining Microsoft's tactics.
      [Image]   [Image] Mr. Glaser is expected to
                disclose that Microsoft's dominant
    Microsoft   Windows and Internet software are
                designed to disable competing software
       Justice  offered by RealNetworks.
   Department   [Image] Microsoft (MSFT) shares gained

 More related   3-15/16 to close at 116-3/4 in Wednesday
  sites...      trading. [Link to top]

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