In his final day of testimony, Microsoft Corp. Chairman Bill Gates acknowledged that his company already makes a scaled-down version of the Windows operating system. In two days of testimony prior to Wednesday, Gates said Microsoft could not build a workable “modular” version of Windows.
A scaled-down version of Windows that would let computer makers pick and choose certain Microsoft applications and replace them with competitors’ products is a primary demand of the nine states that have refused to settle with the Redmond, Wash.-based company.
Throughout his testimony in Microsoft’s epic antitrust case, Gates has said that building a modular operating system would, at the very least, degrade the operating system’s performance.
In his third day of questioning Gates in U.S District Court here, Steven Kuney, the lawyer representing the non-settling states, noted that Microsoft already produces such an operating system: Windows XP Embedded. Gates, however, said Windows XP Embedded would not work the same way as the home version of Windows.
That software, designed for special purposes like cash registers and automated teller machines, can run a version of Windows in which certain software that Gates insisted was essential could be left out. Microsoft doesn’t license that product to computer-makers.
“Using [Windows XP Embedded], could you build an operating system without media playback?” Kuney asked, referring to Windows Media Player, the Microsoft software that allows computers to play audio and video content.
“If you chose a tiny set of functionality, you’d have a very special-purpose operating system,” Gates said.
Kuney then asked if Embedded’s special tools would allow Microsoft to build an operating system that lacked e-mail and scheduling software.
Gates said yes.
Kuney then showed the court Microsoft documents telling customers that with Windows XP Embedded, they could build an operating system that worked just as well as Windows XP Home, the consumer version of Microsoft’s latest operating system.
Still, Gates continued to make dire predictions if the proposals by the non-settling states were adopted by U.S. District Judge Colleen Kollar-Kotelly. The company’s most vital secrets would be available to competitors, Gates said, allowing them to clone Microsoft’s software and, ultimately, harm consumers.
AOL Time Warner, for example, could clone Windows and force subscribers to use their version of the operating system, Gates said.
“They’ve stated to me,” he said of AOL Time Warner officials, “that they don’t like the Windows brand being so meaningful. They’d like consumers to think more about the AOL brand when they’re online.”
Legal experts said Gates has done a good job of explaining the dangers he saw in what the non-settling states want. He maintained his cool during testimony and avoided the arrogant appearance that plagued him during a videotaped deposition shown in an earlier legal proceeding.
Yet some legal experts said Gates was not perfect.
“Ultimately, whether it’s the first trial or here, when you move away from the demeanor and on to the substance, he’s taking a very extreme position, even now,” said Andrew Gavil, a professor at the Howard University School of Law. “The response they have constructed to the states’ remedy is based on an assumption that they did not break the law, or that they broke the law only in a very limited way.
“If the court disagrees with that, part of the foundation for their strategy is taken away,” he said.
“You can’t keep arguing that you’re a good monopoly when the Court of Appeals has already said that you’re not.”
The U.S. Court of Appeals for the District of Columbia last year said Microsoft broke the nation’s antitrust laws. The Justice Department and nine states, including Illinois, have agreed to settle their antitrust lawsuit, leaving nine other states unreconciled with the software giant.
