The Microsoft Trial June 21, 1999

Dahlia Lithwick worked for two years in a family law firm in Reno, Nev. She is writing a novel about how divorce affects children.

Whenever the attorneys in the Microsoft trial are summoned to confer at sidebar with Judge Thomas Penfield Jackson about Top Secret Matters, someone flips a switch, flooding the courtroom with “white noise” sounds to drown out whatever it is the grown-ups may be saying. The effect of what sounds like rushing water, coupled with the vaulted ceiling and dark wood paneling inside the courtroom, is that of portaging a large canoe next to rushing rapids. The effect of all that is an unutterable longing for the bathroom.

Court recessed last Thursday and Friday and reconvened today for the rebuttal testimony of the trial’s last witness: Microsoft’s main economic expert, Richard Schmalensee, dean of MIT’s Sloan School of Management. Schmalensee makes a striking foil for the Justice Department’s chief economist, Dr. Franklin Fisher, who was once his academic adviser. Where Fisher comes off all white-haired and ivory-towered, Schmalensee is pure business-school. He is neatly clipped and mustachioed in the way of 1930’s British film stars. As he is led through his direct examination today by Microsoft’s Michael Lacovara, it’s hard not to see him in Red Baron goggles and a looping red scarf, drilling a thousand little holes in Professor Fisher’s analysis and freeing the world for both Competition and the Consumer.

The gist of Schmalensee’s testimony is that Microsoft has been good for the consumer, and the government has never proved otherwise. He testifies that Microsoft has enabled the consumer to have cheaper, better (free) software, and more and better choices in a browser market once dominated by Netscape. Lacovara, the only member of Microsoft’s Sullivan & Cromwell defense team who appears to still have his heart in all this, does a tremendous job of putting into words the popular feeling that Microsoft is being punished for nothing so much as its own excellence.

Microsoft, says Schmalensee, did not end the browser wars: “The way to see if a war is over is to see if both sides are still firing, and in this case, both sides are still firing.” In a series of colorful charts with pithy titles such as “Plaintiff’s Experts Have Not Shown Consumer Harm,” Schmalensee assails Dr. Fisher’s analysis regarding the distribution of Netscape and the government claims of anti-competitive practices. The charts are so pretty and persuasive, the reporter next to me suggests they look like they might be distributed at a trade show. Whatever they are selling, I want one.

Schmalensee’s entry into the bizarre analogy competition comes when he draws a parallel between computer manufacturers and Cadillacs. He says, sure it would be nice for individual Cadillac dealers to be able to pick and choose whether they want to use Cadillac parts. Heck, he says, choice is always good for a manufacturer. “But if all Cadillac dealers could do it,” he suggests, “that would weaken the brand, and weaken the value of the name Cadillac as a whole.” So then choice is bad for Cadillac. He changes lanes without signaling and gives us a quote from Henry Ford: “You can’t take out the headlight and call it a Ford.” Well, no. But can you take out Internet Explorer and call it Windows 98? He tells us that the icon–if not the browser–can be removed as a “two click function.” Which means, I think, that you can’t take out the headlight and call it a Ford but you can rip out the switch–so the headlight runs all the time.

All this metaphorical talk dovetails nicely with one of several hilarious e-mails sent to Slate last week by readers suggesting “Microsoft Metaphors.” One e-mail ended with the suggestion that “DOJ might be able to find some people out there who are willing to have their Ford engine (included in the price of the car) removed and replaced with a GM engine, but any such person should be locked up.” Well, maybe not locked up. Maybe just forced to listen to another day of economic testimony. With charts.

Click here   for dispatches from the last session of the Microsoft trial between October 1998 and February 1999.