Netscape Communications Corp chief executive Jim Barksdale faced his third day of cross examination in the Microsoft antitrust trial Thursday, with lead defense attorney John Warden still attempting to discredit the written testimony Barksdale had submitted before the trial began. Warden’s efforts for the day were largely intended to prove that Microsoft had behaved in a friendly and cooperative manner with the smaller company and that Netscape’s business model has not been hindered by Microsoft’s actions. Warden used a series of exhibits to make his case, including several documents intended to illustrate the technical cooperation that Microsoft had extended to Netscape. He showcased an email conversation between executives at the two companies in which they discussed ways of sharing development information with an eye toward producing compatible products. More importantly, though, Warden showed off email between Barksdale and Netscape co-founder Marc Andreessen which discussed a meeting with Microsoft officials in early June 1995. Barksdale described the meeting as very friendly, non-threatening, and said it mainly revolved around ways the two companies could work together. He said Microsoft had offered early disclosure of standards and protocols that would allow [Netscape] to improve [its] browser, as well the same sort of early stuff for the NT server platforms. Barksdale also recalled that Microsoft wanted the two to work together in a way which would allow them both to profit, with Netscape building successful enterprise applications as a privileged ISV partner. Warden’s aim was to cast doubt on the notion that Microsoft displayed a heavy-handed attitude toward Netscape as well as to make a Microsoft proposal of allocating markets less plausible by proving the it helped Netscape to create a browser for Windows 95 – exactly what Barksdale claimed Microsoft asked them not to do at a meeting on June 21 1995. Barksdale did not contest how he had characterized the meeting but pointed out that it reflected his opinion at the time. Barksdale also noted in his email that if any of Microsoft’s proposals interested Netscape, they would also like to make an investment in us, something else that was said to be a topic discussed at the June 21 meeting. To support another of his major points, Warden introduced a Netscape internal memo that contained information about how well the company was doing with its browser software. Referred to as a silver bullet memo, the document was a sort of internal newsletter that Barksdale said circulates more or less monthly at the company. Warden highlighted portions that boasted of Netscape’s momentum and claimed that the company had added 25 million users between October 1996 and October 1997 – even as Microsoft had locked up its exclusive deal with America OnLine Inc. The document also spoke of Netscape’s user loyalty, the growing number of downloads from its web site and the fact that most internet service providers want to offer users a choice of browsers. It went as far as asserting that Microsoft’s own deals with ISPs are non-exclusive, something Netscape has claimed all along is not true. The exhibit was designed to again refute the government’s claim that Microsoft’s deals with PC makers and ISPs had effectively crippled Netscape’s ability to distribute its browser products. On the stand, Barksdale clearly disagreed with the memo’s assertions and said whoever wrote it got carried away. Another order of business Thursday was the attempt, once again, to establish that Netscape always planned to give its browser away to build all-important market share. Warden introduced two emails from Marc Andreessen in the fall of 1994 that claimed the company, then called Mosaic Communications Corp, would indeed be making its browser product free for personal use. One of the emails states, We’re absolutely committed to giving 1.0 away for personal use. Watch us. Barksdale was insistent upon the fact that Andreessen was speaking for himself and not the company as whole. He also downpla
yed the fact that John Doerr, of venture capital firm Kleiner Perkins Caufield and Byers and a member of Netscape’s board, was quoted at a conference a saying that the company was focused on internet servers and that the client was just a necessary thing to do to get there. Barksdale said he probably misunderstood the real message – which was to sell a lot of the client to get the company’s name out there. Warden also used passages from a forthcoming book about Netscape to further his claim that the company was prone to give its browser away. Quotes from Netscape’s Bob Lisbonne indicated that the company bundled the browser free of charge with its server products for certain corporate customers. Barksdale insisted that the total package price was the same for these deals, and Netscape was just allowing customers to tell end users that they got the client software free. The practice, which was only done a few times according to Barksdale, was carried out only to allay political battles within organizations that couldn’t justify spending money on a browser license when Microsoft was offering it for nothing. He insisted that Netscape’s own books always accounted for the browser revenue separately and that in January of 1998 – when it officially made its browser free – it lowered the prices for corporate bundles accordingly. When Warden asked why, at that time, Netscape didn’t raise the price of the server products, Barksdale said, Because they wouldn’t pay it.
