ITinfo: Microsoft Disappointed At AOL's Course of Action

Netscape Sues Microsoft

Seeks damages for anticompetitive practices

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Microsoft Disappointed At AOL's Course of Action

by Dave Murphy
ISSN 1535-3613

Netscape, an AOL Time Warner subsidiary, filed suit in the U.S. Federal District Court for the District of Columbia yesterday against Microsoft seeking damages for harm caused by the Redmond software giant's anticompetitive practices. Following a federal district court ruling in June 2000 of Microsoft's illegal anticompetitive practices, Netscape has asked for treble damages (3x the actual financial loss) caused by Microsoft's bundling its Internet Explorer (IE) Web browser with the popular Windows operating system, an action that gave IE a significant competitive advantage over the previously more popular Netscape Navigator Web browser. Netscape argued that Microsoft's anticompetitive practices "resulted in harm to competition and antitrust injury to Netscape in particular."

Microsoft yesterday declined comment, saying that it is disappointed at AOL's course of action.

Netscape's lawsuit is similar to the U.S. government's federal antitrust case against Microsoft. The government's argument stated that Microsoft abused its operating system monopoly to promote IE and engage PC manufacturers to make it easier for end users to use IE; these actions hindered sales of Netscape's product.

Netscape asks for an award of "treble damages," which is allowed by private antitrust suits. If awarded, the damages determined by the federal judge would be tripled; also, Microsoft may be enjoined from shipping its affected product or significantly restricted in its sale.

Dave's Opinion

Netscape has a strong case that follows recent rulings against Microsoft have already established that the Redmond company violated antitrust laws. However, I think it will be difficult for Netscape to prove how much money it lost as a result of Microsoft's anticompetitive practices.

Last evening, I was asked if I thought Opera, the Web browser popular with technically astute users, would benefit from the Netscape-Microsoft suit. At first I didn't think so, but now I'm not so confident in my original answer. If Opera starts actively marketing it's Web browser, which includes a superior e-mail and news group components, it may benefit from the Netscape-Microsoft fracas. I prefer Opera; just as it claims, it's the fastest Web browser on earth.

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References

Netscape
AOL
Microsoft
Opera
U.S. District Court for the District of Columbia
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updated January 23, 2002
http://dgl.com/itinfo/2002/it020123.html