THE EMPIRE STRIKES BACK: MICROSOFT TAKES THE STAND.
By Rachel Chalmers in Washington Microsoft group vice president Paul Maritz became the first Redmond executive to take the stand in the company's protracted antitrust trial Monday, following a closed court session that lasted all morning (see below). Maritz joined Microsoft in 1986 and has gradually assumed responsibility for all Windows operating systems, developer tools, server application products and desktop application software such as Microsoft Office. He has a reputation for intelligence and a dry wit - the latter, sadly, was not much in evidence on Monday. With legal counsel Bill Neukom, Maritz is said to be one of Bill Gates' most trusted lieutenants. Microsoft probably made a tactical error when it aired as evidence a fairly vapid technology demonstration video, which attempted to prove that there is real competition for Windows in the shape of Caldera's OpenLinux, IBM's Network Station and - weirdly enough - Microsoft's own Web TV. General counsel for the Department of Justice David Boies, followed this with a few short jabs to Ma ritz. How many applications did Maritz believe existed for OpenLinux? After hedging, Maritz numbered them in the "several thousands". How many applications were available for Windows? "In the thousands," was Maritz's reply, although he noted that he did not count them personally. Boies persisted and won from Maritz an admission that applications for Windows numbered in the tens of thousands. The true figures, which neither side spelled out, are said to be something like 2,500 applications available on Linux, compared with 60,000 on Microsoft operating systems. Boies followed this up with an inquiry into profits. Maritz admitted that he didn't think Caldera actually made much money on OpenLinux. Asked about the profitability of Windows 95 and 98, he hedged. The products brought in around $3bn worth of revenues, Maritz said, but he steadfastly maintained that Microsoft does not calculate direct profits by product. "We look at revenues and directly attributable expenses," he explained. The expenses directly attributable to W95 and W98 amount to $1bn. The government wants you to conclude that Microsoft is creaming around $2bn a year from Windows; Microsoft wants you to assume that expenses shared across all divisions bring that figure down to some far more modest figure (unless you are an investor, in which case, conclude away!).
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|Date:||Jan 26, 1999|
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