Barksdale to Testify on Deal With Microsoft

Former Netscape Communications Corp. Chief Executive James Barksdale, a key witness in next month’s Microsoft antitrust trial, will testify that if the software giant’s proposed settlement with the Justice Department had been in place six years ago, Netscape might never have been formed.

As the lead-off witness in the Justice Department’s first trial against the software giant in 1998, Barksdale won points with his folksy language. He told a federal judge then that Microsoft had used a variety of unfair means to crush Netscape, tying its own Internet Explorer browser to the omnipresent Windows operating system and threatening to stop making Office software for Apple computers if Apple kept shipping Netscape.

In a recent deposition taken before the new trial, Barksdale said he stuck by what he said nearly four years ago. And he said he planned to go into detail about how the proposed settlement would make things even easier for Microsoft to win in new markets.

The interview was conducted Feb. 2 in Washington and was first released to the media after U.S. District Judge Colleen Kollar-Kotelly granted a request by the Los Angeles Times and other newspapers for access to depositions.

A general theme of Barksdale’s objections to the proposed deal among Microsoft, the Justice Department and nine states that had sued was that various provisions in the document give computer companies new freedoms and then undercut them with exceptions.

“They start off sounding like everybody is going to be good friends, and the second half seems to take it away,� Barksdale said.

For example, he cited computer companies’ new right to put some types of third-party programs on Windows-based machines--as long as Microsoft has a competing program.

“Well, what if they don’t have a competing product? I’m out here with a flapjack actuator; they don’t have one. According to this document, I can’t launch it,� Barksdale said. “That’s a terribly chilling thing.�

He also faulted the provision that allows Microsoft to pester computer buyers after two weeks to ask them whether they want to switch to more Microsoft programs. “You could say, ‘You sure you don’t want to sign up for Internet Explorer?’ Nobody’s going to build a competitive product to something that has that kind of distribution and marketing muscle across hundreds of millions of desktops,� he said.

Barksdale also said that Microsoft could use a loophole on sensitive security information to avoid new requirements that it disclose to competitors more information about how Windows interacts with smaller programs.

On appeal after the previous trial, a higher court found that Microsoft had abused its monopoly position, sending the case back to the district court to determine appropriate remedies.

After Netscape was sold to Microsoft rival America Online Inc., now AOL Time Warner Inc., Barksdale became a venture capitalist. He said venture firms as a rule won’t back anything that competes head-on with Microsoft.

With such a light punishment as that backed by the Justice Department, he said, far fewer software start-ups will get off the ground. And Netscape, which ignited the Internet boom with its 1995 initial public offering, would never have been funded.

Microsoft and attorneys for the states had no immediate comment on Barksdale’s testimony.