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February 23, 1999


By CBR Staff Writer

Microsoft Corp’s Eric Engstrom offered a fascinating insight into the office politics of a software giant at the antitrust trial yesterday. In February 1997, Engstrom was pushing for Microsoft to acquire a company called Dimension X for its beginner-level multimedia content authoring tool. Engstrom was also aware that this would put Marimba’s nose out of joint as they used the Dimension X tool – Liquid Audio – for their authoring at the time. Engstrom had also noted that Netscape was intending a large announcement around this…in the next few weeks. We could achieve a huge tactical win here by removing their key tool. Engstrom said in court that his reason for wanting to acquire Dimension X was to get their authoring tool and that he felt that he would be supported in this aim if he pointed out the tactical advantages to his superiors, the decision makers such as Brad Silverberg. One way he felt he would achieve his objective was by pointing out how buying Dimension X would put back Netscape’s plans and benefit Microsoft’s IHammer tools project which was being championed by Todd Neilson. In the email Engstrom had written, Given how important IHammer is to TodN I think derailing the IHammer equivalent for Netscape would be a HUGE thing. He was naturally questioned repeatedly about this by government man Philip Mallone but continued to deny that anti- competitive behavior lay at the heart of his actions. Instead, he said that he wanted Nielson’s support for IHammer to vector into support for the acquisition of Dimension X. Engstrom said quite frankly that he had never been convinced by the IHammer tools and had wanted to cancel the project. Todd Neilson, who was on hand at the court yesterday, admitted that he had been wrong about the toolkit at the time.

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