U.S. vs. Microsoft
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Deposition of Bill Gates
September 2, 1998, Page 3

On Wednesday, April 28, 1999, the official transcript of the
deposition of Microsoft Chairman Bill Gates was released.

	1		Q.	The second e-mail is an e-mail from you
	2	dated December 1, 1996 at 9:24 p.m.; correct?
	3		A.	Yes.
	4		Q.	And there is a third e-mail from
	5	Mr. Nehru dated November 27, 1996, at 11:54 a.m.;
	6	correct?
	7		A.	Well, it's not a separate e-mail.  It's
	8	part of my e-mail.
	9		Q.	Well, sir, let me try to see if we can
10	get this straight.  And we'll read this whole thing
11	into the record if we have to.  
12		A.	I can explain what you're confused
13	about.
14		Q.	I'm not confused, Mr. --
15			MR. HEINER:  Gates.
16		Q.	BY MR. BOIES:  -- Gates.  Indeed I
17	think I stated it accurately, if you want to start
18	talking about what I think.  But my function is to
19	ask you questions and your function is to give me
20	answers to the questions and neither of our functions
21	are to debate the other at this point.  
22			Exhibit 353 starts with an e-mail dated
23	December 1, 1996 from Mr. Ballmer to you; correct?
24		A.	There's only one e-mail in here, which
25	is the one from Steve, which has two e-mails enclosed
	1	in it.
	2		Q.	Well, what is enclosed here are two
	3	additional e-mails; correct, sir?
	4		A.	They're part of Steve's e-mail.
	5		Q.	That is, Steve -- and by Steve you mean
	6	Mr. Ballmer; correct?
	7		A.	Yes.
	8		Q.	-- is sending around with his e-mail
	9	two earlier e-mails; correct?
10		A.	They're part of his e-mail.
11		Q.	When you say they're part of his
12	e-mail, he didn't write them, did he, sir?
13		A.	No, but they're part of his e-mail.
14		Q.	That is, he is sending them around? 
15	That's what I said three times.  He is sending them
16	around with his e-mail.  He wrote something and in
17	addition to what he wrote, he is sending around what
18	two other people wrote earlier; correct, sir?
19		A.	It's part of his communication.  It's
20	not separate.
21		Q.	I don't know what you mean by part or
22	separate and neither one of those were in my
23	question, Mr. Gates.  My question is, Mr. Ballmer
24	wrote an e-mail that he sent around and with that
25	e-mail he sent around two earlier e-mails; that's
	1	clearly what's going on here; right, sir?
	2		A.	He only sent one thing.
	3		Q.	All right, sir.  The first line on
	4	Exhibit 353 says "Leslie Halverson (LCA)"; correct,
	5	Mr. Gates?
	6		A.	Yes.
	7		Q.	Okay.  The next line says "From:  Steve
	8	Ballmer."  The next line says, "Sent:  Sunday,
	9	December 1, 1996, 9:25 p.m." and then "To:  Bill
10	Gates, Amar Nehru."
11		A.	Does yours say 9:25?
12		Q.	Well, on 353 it looks like 9:26.  
13		A.	Right.  And you said 9:25.
14		Q.	Okay, then I misspoke.  With that
15	amendment, it is correct, though; correct?
16		A.	That's right.
17		Q.	And it then goes down six more lines
18	and then there is a line that says "Original
19	Message;" correct?
20		A.	Right.
21		Q.	And that says "From:  Bill Gates,"
22	correct?
23		A.	That's right.
24		Q.	And it says you sent it Sunday,
25	December 1, 1996 at 9:24 p.m.; correct?
	1		A.	That's right.
	2		Q.	And then it goes down one, two, three,
	3	four, five, six, seven, eight, nine, ten lines and
	4	then there is another line that says "Original
	5	Message;" correct, sir?
	6		A.	That's right.
	7		Q.	And that says it is from Mr. Nehru;
	8	correct?
	9		A.	Yes.
10		Q.	And it says it was sent on Wednesday,
11	November 27, 1996 at 11:54 a.m.; correct, sir?
12		A.	Right.
13		Q.	Now, the portion that follows your line
14	that says, "I don't think this analysis needed to be
15	sent to so many people," that's the last line before
16	the line that says "Original Message" from Mr. Nehru;
17	correct?
18		A.	That's right.
19		Q.	Everything after your line saying 
20	"I don't think this analysis needed to be sent to so
21	many people" has been blocked out on Exhibit 380,
22	correct, and replaced with a stamp that says
23	"Privileged Material Redacted"?
24		A.	Do I still have 380?
25		Q.	Unless you have eaten it.  It was the
	1	one we just marked a few moments ago, a few minutes
	2	ago.  
	3			MR. HEINER:  It's gone.
	4		Q.	BY MR. BOIES:  In any event, your
	5	counsel has in front of him another copy of it.
	6		A.	Yes.
	7		Q.	And we'll use that copy.  
	8		A.	Yeah, it looks like they're the same
	9	except that they deleted the part of my message where
10	I enclosed the information from Amar.
11		Q.	When you say you enclosed the
12	information from Amar, you mean where you enclosed
13	Mr. Amar's e-mail?
14		A.	As part of my e-mail.
15		Q.	In haec verba?  
16			MR. HEINER:  Don't use that.
17		Q.	BY MR. BOIES:  Word for word?
18		A.	Yes, it appears to be his e-mail word
19	for word.
20		Q.	Okay.  I was just trying to make sure
21	the record is clear.  
22			MR. HEINER:  I'm ready for a break if
23	you're about to get into the more interesting part.
24			MR. BOIES:  We can take a break. 
25			VIDEOTAPE OPERATOR:  The time is 10:38. 
	1	We're going off the record.
	2			(Recess.) 
	3			VIDEOTAPE OPERATOR:  The time is 10:59. 
	4	We're going back on the record.
	5		Q.	BY MR. BOIES:  The November 27, 1996
	6	Nehru e-mail that you sent around is headed "Netscape
	7	Revenues;" correct, sir?  And it is a discussion of
	8	an analysis of Netscape's revenues?
	9		A.	I didn't send it around.  Amar sent it
10	around.  I enclosed it.
11		Q.	I thought we established that you then
12	sent it around.  
13		A.	I enclosed it, yes.
14		Q.	When you say you enclosed it, that
15	means it's enclosed with what you have written so
16	that it goes around to everybody that your e-mail is
17	directed to; correct?
18		A.	Well, Amar had already sent it to quite
19	a large superset of the people I copied on my e-mail,
20	so he sent it to them.
21		Q.	He sent it to them and then you sent it
22	to everybody that is on the addressee or copy list of
23	your e-mail; correct?
24		A.	I enclosed it to those people who had
25	already all gotten it from Amar.
	1		Q.	And by enclosing it means you sent it
	2	around?
	3		A.	That's not the word I would use, but it
	4	was enclosed in the e-mail I sent to those people who
	5	had already received it directly from Amar.
	6		Q.	So when people got your e-mail -- all
	7	I'm trying to do is -- I don't think this is obscure. 
	8	All I'm trying to do is establish that when you sent
	9	your e-mail to the five people that you sent it to,
10	with your e-mail they got Mr. Nehru's e-mail?
11		A.	Which they had already gotten.
12		Q.	And they got it again?
13		A.	As an enclosure, yes.
14		Q.	As an enclosure to your e-mail?
15		A.	Right.
16		Q.	And that e-mail from Mr. Nehru that you
17	enclosed with your e-mail is a discussion of
18	Netscape's revenues; correct, sir?
19		A.	That's the subject line of his e-mail.
20		Q.	Not only is it the subject line, that's
21	what the substance of the e-mail is?
22		A.	Do you want me to look at it?  
23		Q.	If you need to to answer the question.
24		A.	It appears to be a discussion of
25	Netscape's revenue, or what he was able to find out
	1	about it at a 70 percent confidence.
	2		Q.	And the first line of your memo that
	3	you send to the five people indicated here, including
	4	Mr. Maritz and Mr. Ballmer, is "What kind of data do
	5	we have on how much software companies pay Netscape?"
	6	correct, sir?
	7		A.	Yes.
	8		Q.	And did they furnish you with that
	9	information?
10		A.	I don't think so.
11		Q.	You say in the next line, "In
12	particular I am curious about their deals with Corel,
13	Lotus and Intuit."  Do you see that?
14		A.	Uh-huh.
15		Q.	You've got to say yes or no for the --
16		A.	Yes.
17		Q.	Did you ever receive information about
18	what revenues Netscape was getting from any of those
19	companies?
20		A.	I'm quite sure I didn't.
21		Q.	Netscape was getting revenues from
22	Intuit.  You knew that in December of '96; correct,
23	sir?
24		A.	I still don't know that.
25		Q.	You still don't know that?  You tried
	1	to find that out in December of 1996; correct?
	2		A.	I did not myself try and find that out.
	3		Q.	You tried to find it out by raising it
	4	with people who worked for Microsoft, didn't you? 
	5	That's what this message is?  
	6		A.	It says I'm curious about it.
	7		Q.	Well, the first line says, "What kind
	8	of data do we have about how much software companies
	9	pay Netscape?  In particular I am curious about their
10	deals with Corel, Lotus and Intuit."  That's what you
11	wrote to Mr. Nehru, Mr. Silverberg, Mr. Chase, 
12	Mr. Ballmer and Mr. Maritz; correct, sir?
13		A.	Right, because Amar's mail didn't seem
14	to have any data about that.
15		Q.	And is it your testimony that you never
16	got any data about that?
17		A.	That's right.  I don't remember getting
18	any data.  I'm quite sure that I didn't.
19		Q.	Did you follow up to try to get an
20	answer to those questions?
21		A.	No.
22		Q.	After December of 1996, Microsoft
23	entered into an agreement with Intuit that would
24	limit how much money Intuit paid Netscape; correct,
25	sir?
	1		A.	I'm not aware of that.
	2		Q.	Are you aware of an agreement that
	3	Intuit entered into with Microsoft?
	4		A.	I know there was some kind of an
	5	agreement.  I wasn't part of negotiating it, nor do I
	6	know what was in it.
	7		Q.	Do you know anything that was in the
	8	Intuit agreement?
	9		A.	I'm quite sure that Intuit had a plan
10	to use our componentized browser.  And I think in the
11	agreement they agreed to make that their default
12	browser.
13		Q.	Do you know anything else about the
14	Intuit agreement?
15		A.	Well, Mr. Houck, when he --
16		Q.	Do you know anything else about the
17	Intuit agreement?
18		A.	I was going to answer.
19		Q.	Well, okay.  I just want to be clear
20	that what I'm asking about has nothing to do with
21	what Mr. Houck knows or what Mr. Houck suggested. 
22	It's what you know.  Now, if Mr. Houck refreshed your
23	recollection about it, that's fine.  
24		A.	Let me say the sentence and then we'll
25	see what you say.  
	1		Q.	Okay.
	2		A.	Mr. Houck showed me an e-mail which
	3	appeared to be written by Will Poole talking about
	4	his discussions with Intuit, and I could tell you
	5	what I remember from that e-mail that Mr. Houck
	6	showed me.
	7		Q.	No, because that's in the record
	8	already.  What I need to know is whether, based on
	9	anything that Mr. Houck did or that I did -- I think
10	I actually may have showed you the e-mail you're
11	talking about, but whether it was Mr. Houck or me,
12	based on whatever happened before, do you now have a
13	recollection of the Intuit agreement other than about
14	the default browser?  
15			MR. HEINER:  Objection.
16			THE WITNESS:  I'm confused.
17		Q.	BY MR. BOIES:  Okay.  Let me
18	distinguish two things.  I'm not asking you to try to
19	remember the e-mail that you were shown before.  What
20	I'm asking is whether, as you sit here now, you have
21	a memory or recollection of the Intuit deal other
22	than that it made IE the default browser?
23		A.	No.
24		Q.	Now, let me go back to where I was
25	before we entered into our discussion of Mr. Nehru's
	1	e-mail.  
	2			Other than the e-mail that you sent on
	3	December 1, 1996, do you recall any other instances
	4	in which you were personally asking for data about
	5	Netscape?
	6		A.	I think I was in a meeting, a normal
	7	review-type meeting, where some data on Netscape was
	8	presented by Amar, and it's likely that I asked at
	9	least one question during the meeting.
10		Q.	Any other instances?
11		A.	I think there was e-mail about a
12	specific deal that Netscape did with Citicorp in the
13	last couple months where I was curious about how much
14	Citicorp had paid.  Either that or the mail just
15	included that information.
16		Q.	Any other instance in which you
17	personally asked for information concerning
18	Netscape's revenues, head count, business, plans or
19	dependencies?
20		A.	I remember once saying to Brad
21	Silverberg how many developers does Netscape have,
22	and being curious about that.
23		Q.	Any other instances?
24		A.	I think when we did geographic reviews
25	one time, I asked someone if Netscape had an office
	1	in their country.  
	2			I think once when I was in Japan --
	3	this is another instance -- I asked what the browser
	4	usage share was in Japan, in particular what
	5	Netscape's usage share was.
	6		Q.	Have you completed your answer?
	7		A.	Yes.
	8		Q.	Have you now given me all of the
	9	instances that you can recall in which you have
10	personally asked for information concerning
11	Netscape's revenues or head count or dependencies?
12		A.	Yes.
13		Q.	Let me ask you to look at a document
14	that we will mark as Exhibit 381.  The third item on
15	the first page is an e-mail from Paul Maritz to you
16	dated January 16, 1996.  It is to you and a number of
17	other people, but you are the first there.  Do you
18	see that?
19		A.	Yes.  
20			(The document referred to was marked
21	by the court reporter as Government Exhibit 381 for
22	identification and is attached hereto.) 
23		Q.	BY MR. BOIES:  Did you receive this
24	e-mail in January, 1996?
25		A.	I don't remember receiving it, but I
	1	have no reason to doubt that I did.
	2		Q.		The second sentence of Mr. Maritz's
	3	e-mail to you says, "We need to look carefully at any
	4	significant opportunity to gain share versus
	5	Netscape."  Do you see that?
	6		A.		That's part of the 
sentence that I see. 7 Q. The rest of the sentence says,
"and 8 think carefully before AOL goes off and partners with 9 Netscape." Do you see that? 10 A. Yes. 11 Q. That's the rest of the sentence; right? 12 A. Right. 13 Q. Even though you don't recall receiving 14 this particular e-mail, do you recall Mr. Maritz 15 telling you in or about January of 1996 that he 16 believed that Microsoft had to look carefully at any 17 significant opportunity to gain share versus 18 Netscape? 19 A. No. 20 Q. Do you recall Mr. Maritz telling you in 21 or about January of 1996 that there was a possibility 22 that AOL was going to go off and partner with 23 Netscape? 24 A. I don't know the time frame, but I know 25 there was -- there came a time where AOL was 566 1 considering whether to keep doing their own browser 2 technology or work with someone else on that. 3 Q. And is that your understanding of what 4 Mr. Maritz was referring to when he talks about AOL 5 going off and partnering with Netscape? 6 A. It appears to be a mail about -- let me 7 take a look at it. 8 It appears to be a mail about OEMs 9 prominently featuring the AOL client in such a strong 10 way that anything we would do for AOL in that regard 11 would be of no impact and, therefore, that maybe we 12 should work with AOL on the browser. 13 MR. BOIES: Could I have that answer 14 read back. 15 (Record read.) 16 MR. BOIES: And would you read my 17 question back, please. 18 (Record read.) 19 THE WITNESS: Well, having read the 20 mail, my best guess is that he is talking about the 21 browser, but it's just a guess reading the e-mail. 22 Q. BY MR. BOIES: Well, when you say that 23 your best guess is he is talking about the browser, 24 you mean in his e-mail that this is about a browser? 25 A. About working with AOL on browsing 567 1 technology. 2 Q. Well, do you have any doubt that this 3 is related to browsers, sir? 4 A. It's certainly part of what it's about. 5 Q. When Mr. Maritz says, "We need to look 6 carefully at any significant opportunity to gain 7 share versus Netscape," he is talking about browser 8 share, is he not? 9 A. Almost certainly. 10 Q. And as you've previously pointed out, 11 part of the same sentence is that he says that it's 12 important to "think carefully before AOL goes off and 13 partners with Netscape." Do you see that? 14 A. I see it. 15 Q. And when he is talking about going off 16 and partnering with Netscape, he is talking about AOL 17 partnering with Netscape relating to browsers; 18 correct? 19 A. As I said, I'm not certain what he 20 means, but from reading the e-mail, certainly 21 browsers is part of what he is talking about, it 22 appears. 23 Q. And in response to this issue, did 24 Microsoft go off and partner with AOL with respect to 25 browsers? 568 1 A. In response to what? 2 Q. In response to the thing that 3 Mr. Maritz writes to you in January of 1996, that he 4 wants to look carefully at any significant 5 opportunity to gain share versus Netscape and AOL is 6 thinking about going off and partnering with 7 Netscape. 8 MR. HEINER: Objection. 9 THE WITNESS: The reason we did enter 10 into some partnership activities with AOL is in order 11 to let them take advantage of some of the innovations 12 we'd done in browsers and get broader exposure of the 13 work that we'd done there. 14 Q. BY MR. BOIES: And did you enter into 15 partnership relationships with AOL concerning 16 browsers? 17 A. We entered into a partnership, a 18 primary element of which was working together to make 19 the Windows browsing technology meet AOL's needs. 20 Q. And was one of the reasons that you did 21 that to try to gain share versus Netscape? 22 A. Our goal was certainly to improve the 23 exposure of our innovation and therefore the usage 24 share of IE. 25 Q. Now, when Mr. Maritz writes to you, he 569 1 is not writing about gaining exposure for your 2 innovations, he is writing about gaining share versus 3 Netscape; correct, sir? 4 A. Are we back to focusing on this piece 5 of e-mail here? 6 Q. I don't know what you mean by "back 7 to," but in January of 1996, Mr. Maritz writes to you 8 about pursuing any significant opportunity "to gain 9 share versus Netscape." Do you see that sir? 10 You said you didn't have any doubt that 11 you'd read this; correct? 12 A. I have no reason to doubt that I 13 received it. 14 Q. Do you doubt that you received it? 15 A. No. 16 Q. Okay. So you accept you received this 17 e-mail? 18 A. I said I had no reason to doubt that I 19 received it. 20 Q. And you also said you don't doubt it? 21 A. I don't know for sure that I received 22 it because I don't remember specifically receiving 23 it. 24 Q. Let me put it this way. As you sit 25 here now, you believe you received it, don't you, 570 1 Mr. Gates? 2 A. I believe it's more likely than not 3 that I received this e-mail. 4 Q. As you've described previously in the 5 deposition, can you give me any probability greater 6 than that? 7 A. I think it's very likely. 8 Q. Okay. Now, in this e-mail that it is 9 very likely that you received in January of 1996, 10 Mr. Maritz writes that you need to look carefully at 11 any significant opportunity to gain share versus 12 Netscape and you need to think carefully before AOL 13 goes off and partners with Netscape. 14 Was the desire to gain share versus 15 Netscape part of what led Microsoft to itself partner 16 with AOL with respect to browsers? 17 MR. HEINER: Objection. Asked and 18 answered. 19 THE WITNESS: Our goal was to raise the 20 usage share of our Internet Explorer technologies in 21 Windows and that's the reason we did the agreement 22 with AOL. 23 Q. BY MR. BOIES: Now, when you refer to 24 gaining things in Windows, the documents that talk 25 about browser share don't talk about gaining share 571 1 for Windows, do they, sir? 2 A. They talk about gaining share for the 3 IE part of Windows. 4 Q. Well, they don't even talk about 5 gaining share for the IE part of Windows. Have you 6 seen any documents that talk about gaining share for 7 the IE part of Windows? 8 A. Well, certainly if you're talking about 9 e-mail within Microsoft, we all know that IE is a 10 part of Windows and so we don't bother, for any 11 feature that we're studying usage of, to restate "and 12 that feature is a part of Windows." We simply refer 13 to the feature. 14 Q. IE is distributed other than as part of 15 Windows, is it not, sir? It's distributed 16 separately? 17 A. It's a different thing we do, which is 18 we create an IE for Macintosh that shares some of the 19 same code as the IE capabilities that are in Windows. 20 MR. BOIES: Would you read back the 21 question, please. 22 (Record read.) 23 Q. BY MR. BOIES: Can you answer that 24 question, sir? 25 A. We take a subset of the IE technologies 572 1 that are in Windows and create something independent, 2 which is the IE for Macintosh, although there is a 3 lot of unique code that is written for that work. 4 And we also create it for Unix as well. 5 Q. When you look at your browser share, do 6 you include in your browser share the usage of IE 7 browsers that are used on Macintosh? 8 A. Sometimes yes and sometimes no. You 9 can add those numbers together and sometimes we do 10 that. You can track the numbers separately and we've 11 certainly done that as well. 12 Q. When you talk about your IE browser 13 share without further elaboration, is that including 14 your IE usage on Macintosh or not? 15 A. Highly ambiguous. 16 Q. When you receive discussion of 17 Microsoft's browser share without further 18 elaboration, how do you understand those references? 19 Do you understand those references to include your 20 usage on Macintosh or not to include IE's Macintosh 21 usage? 22 A. I'd have to look at the reference. If 23 they say Windows, then they don't include Macintosh. 24 If they just say it without mentioning Windows, it's 25 not clear whether they're including the Macintosh 573 1 usage or not. 2 Q. Have you ever asked someone who wrote 3 you just talking about browser share whether they 4 were talking about browser share including Macintosh 5 or not? 6 A. Yes, I believe I have. 7 Q. Who did you ask that of? 8 A. I'm sure I sent mail and probably 9 included Brad Chase as one of the people I would 10 have, in responding to something like that, included. 11 Q. What was the response? 12 A. I'm sure they clarified which numbers 13 referred to the IE usage from within Windows 95 and 14 which referred to the IE offering we make on the 15 Macintosh. 16 Q. And with respect to Exhibit 381, the 17 January, 1996 message from Mr. Maritz to you where he 18 is talking about gaining share versus Netscape, does 19 that include usage share on Macintosh or not? 20 A. It's not clear at all. 21 Q. Do you have any understanding as to 22 what he meant by that? 23 A. Whether he included the Macintosh share 24 or not, is that the question? 25 Q. Yes. 574 1 A. No, I don't know. 2 Q. When IE share is discussed within 3 Microsoft, that share is discussed as a share of 4 browsers, is it not, sir? Those are the words that 5 are used? Whatever they may mean, whatever you say 6 they may mean, that's the words that are used; is 7 that correct, sir? 8 A. We're talking about -- 9 MR. HEINER: Objection. Sorry. Go 10 ahead. 11 THE WITNESS: We have data about the 12 usage levels of various browsers and we look at 13 those. 14 MR. BOIES: Could I have the question 15 read back, please. 16 (Record read.) 17 THE WITNESS: I've never heard anyone 18 say it's discussed as a share of browsers. What the 19 heck would that mean? 20 Q. BY MR. BOIES: Well, if your answer is 21 that you have never heard of that, that's your 22 answer, Mr. Gates. 23 A. I don't know what you mean "as a share 24 of browsers." I've never heard of anybody use the 25 phrase "as a share of browsers." I don't know what 575 1 it would mean. 2 Q. So it's your testimony as you sit here 3 under oath that if somebody asked you that question 4 or said something like that within the course of your 5 business, you just wouldn't have any idea what it 6 meant? That's your testimony? 7 A. I would certainly seek clarification of 8 what they were trying to say. I'd have an idea they 9 were referring to something to do with the Internet, 10 something to do with browsers, so I'd certainly have 11 some idea, but I'd seek clarification before I could 12 communicate effectively with them. 13 Q. Have you ever sought clarification from 14 anyone on that? 15 A. I told you I've never heard that term 16 used in my recollection. 17 Q. When you said in the exhibit we were 18 talking about that browser share was a very very 19 important goal -- do you remember that document? 20 A. Which exhibit are you referring to? Is 21 there a number? 22 Q. I'm sure we can find the number, but 23 since I know you have very good memory about these 24 exhibits since you remembered Exhibit 353 from 25 several days ago, do you remember the document we 576 1 were talking about this morning? 2 A. I remember many documents that we were 3 talking about this morning. 4 Q. Do you remember a particular document 5 in which you were writing that browser share is a 6 very very important goal for Microsoft? 7 A. Yes. 8 Q. Let me see if I can get you to look at 9 Exhibit 358. Now, when you personally were talking 10 about winning Internet browser share, Mr. Gates, what 11 were you talking about there? 12 A. I'm not sure. If I had to guess, I'd 13 say this e-mail appears to be in the context of 14 Windows. 15 Q. So what you're saying is that in this 16 context you were including only usage share on 17 Windows; is that what you're saying? 18 A. Well, it's interesting because I say 19 here, "I would like to understand what we need to do 20 to convince OEMs to focus on our browser. Is our 21 problem proving our technology and its capability? 22 Is our problem that they are getting bounty fees by 23 having Internet Service providers pay them a sum or a 24 royalty on the business they get? Is a 3.1 browser a 25 key issue for them?" So except for that sentence, I 577 1 would have thought it was mainly Windows 95 share of 2 browser usage, but when I say "Is a 3.1 browser a key 3 issue for them," I'm talking about something else. 4 Q. So is it your testimony you're just, as 5 you sit here now, confused as to what you were 6 talking about? 7 A. I think it's likely I was referring to 8 usage on Windows 95, but that one sentence throws me 9 off. 10 Q. Prior to the time that Windows 98 -- 11 not Windows 95 -- Windows 98 came out, what was it 12 called internally within Microsoft? 13 A. Most commonly it was called Memphis. 14 Q. Was there also a period of time where 15 it was referred to as Win 97? 16 A. It's possible. It's also possible it 17 would have been called Win 96 at some point, but the 18 primary term, the one I remember being used, was 19 Memphis. 20 Q. When you talked about in January of 21 1996 that "Winning Internet browser share is a very 22 very important goal for us," are you saying it was 23 limited to Windows 95 and perhaps earlier Windows 24 operating systems, that it did not include Memphis or 25 Windows 98? 578 1 A. Now you're trying to get me to indicate 2 whether I was talking about future products in this 3 mail? 4 Q. Well, what you talk about is winning 5 Internet browser share, and as I understood what you 6 said was that you thought that you were probably 7 talking about share of usage on Windows 95. Did I 8 understand you correctly? 9 A. I think you're making a good point that 10 the future products that -- innovations that we were 11 doing in the IE thing, depending on the time frame 12 you look at, are key in -- I don't think I'm 13 referring to future products here. Do you think I 14 am? 15 Q. I don't have a view on that, Mr. Gates. 16 A. Okay. 17 Q. I'm not entitled to at this stage. 18 MR. HEINER: You certainly expressed a 19 lot of views in the papers yesterday. 20 MR. BOIES: That is where we are 21 entitled to express views, in the papers we file. 22 Q. Let me approach it a little more 23 generally. In a number of questions I've asked you 24 about whether Microsoft wanted to gain browser share, 25 and you have said, well, we want to have more 579 1 exposure for our innovations. Are you aware of any 2 effort within Microsoft, for purposes of this 3 litigation, to sort of change the way you and others 4 use terms? 5 A. No. 6 Q. None at all, sir? 7 A. Changing the way I use terms? No. 8 Q. How about changing the way others in 9 Microsoft use terms? 10 A. I'm not aware of that, no. 11 Q. Are you aware of any discussions within 12 Microsoft about changing the way terms are used in 13 order to advance your interests in the litigation? 14 A. No. 15 Q. In your answers you refer often to 16 browser technologies or browsing technologies as 17 opposed to answering a question simply about 18 browsers. Is that related at all to avoid using a 19 term that you think connotes a separate product? 20 A. It's all done with the goal of making 21 sure you're not confused about what I'm referring to. 22 Q. Well, is it part of the goal to try to 23 advance a particular point of view in this 24 litigation, is that part of why you don't want to use 25 in this deposition words like browser that are 580 1 throughout the documents of the Microsoft 2 Corporation? 3 A. I'm glad to use the term browser and 4 I've used the term many times in this deposition and 5 in many other cases. 6 Q. And when you use the term browser, you 7 know what it means, do you not, sir? 8 A. When I use terms in general, I do it in 9 a context where it's clear what they mean. In the 10 case of browser, as we've discussed, sometimes it 11 might include what we're doing on Macintosh, 12 sometimes it might include one version of Windows, 13 sometimes it might include other people's products 14 that include those capabilities. Isolated by itself 15 are you saying does the word browser without any 16 context mean something that is evident to me? No, 17 but in a specific context, I freely use the word 18 without any difficulty. 19 Q. And, for example, in writing to your 20 top officers in January of 1996, you talk about 21 winning Internet browser share and you believed you 22 were being understood; correct, sir? 23 A. Are you referring to an e-mail to a 24 single person, to Joachim Kempin? 25 Q. The one I have in front of me is 581 1 addressed to Mr. Kempin with copies to 2 Mr. Silverberg, Mr. Chase, Mr. Ludwig, Mr. Ballmer, 3 and a number of other people. 4 A. But I think in terms of understanding 5 the context of the message, the fact that it is 6 directed to Joachim Kempin and talks about OEMs helps 7 establish what I probably meant when I talked about 8 browser share here and browsers. 9 Q. Let me just be clear. When you sent a 10 copy -- I don't want to go through all the names 11 here, but two of the people you sent copies to were 12 Mr. Ballmer and Mr. Maritz; is that fair? 13 A. Yes. 14 Q. And they were two of the very top 15 officers of Microsoft; correct? 16 A. Yes. 17 Q. Now, let me go back to what I was 18 pursuing before. Is there an effort at all on your 19 part or insofar as you are aware on other people's 20 parts, to change the way words are used so as to, 21 from your standpoint, clarify what is meant for 22 purposes of this litigation? 23 A. I've told you I'm not aware of an 24 effort to change the use of terminology related to 25 the purposes of this litigation. 582 1 Q. Let me ask you to look at a document 2 that has been marked as Government Exhibit 393. The 3 first e-mail here -- and there's an e-mail from you 4 later on, but the first e-mail here is an e-mail to 5 you and others dated February 15, 1998; is that 6 correct? 7 A. To me? 8 Q. Yes. 9 A. Yes. 10 (The document referred to was marked 11 by the court reporter as Government Exhibit 393 for 12 identification and is attached hereto.) 13 Q. BY MR. BOIES: And the subject is 14 "Re: Browser in the OS." Do you see that subject of 15 the February 15, 1998 e-mail to you? 16 A. Yes. 17 Q. And is it fair to say that that e-mail 18 is a response to an e-mail from you dated 19 February 14, 1998 at 10:42 a.m.? 20 A. It appears to be. 21 Q. And the subject of your e-mail was 22 "Browser in the OS;" is that correct? 23 A. Yes. 24 Q. Now, the next to last paragraph on the 25 first page of the memo to you -- and this memo goes 583 1 to you and to a large number of other people; is that 2 correct? 3 A. I'm sorry? I just wasn't listening 4 carefully. 5 Q. Sure. The February 15th, 1998 memo 6 that is addressed to you also goes to four other 7 addressees and a large number of additional copies; 8 correct? 9 A. 13, yes. 10 Q. And this includes, together with 11 yourself, the top executives of the company; correct? 12 A. Not all the top executives, no. 13 Q. Well, it includes Mr. Ballmer? 14 A. It includes some of the top executives. 15 Q. And it includes Mr. Maritz; correct? 16 A. Yes. 17 Q. And it includes yourself; correct? 18 A. Yes, in the "To" line. 19 Q. And it says in the next to last 20 paragraph "Saying 'put the browser in the OS' is 21 already a statement that is prejudicial to us." 22 A. Where are you looking? I thought you 23 said the next to last paragraph. 24 Q. Next to last paragraph on the first 25 page. 584 1 A. Oh, okay. 2 Q. It says -- and this is a quotation from 3 the memo to you and the others, "Saying 'put the 4 browser in the OS' is already a statement that is 5 prejudicial to us. The name 'browser' suggests a 6 separate thing." 7 Do you remember being told that in or 8 about February of 1998? 9 A. No. 10 Q. Do you remember receiving this e-mail? 11 A. I don't remember receiving it, but I 12 have no reason to doubt that it was a piece of e-mail 13 that was sent. 14 Q. Does this in any way refresh your 15 recollection that within Microsoft there were 16 discussions as to what words should or should not be 17 used? 18 A. I don't know what you mean refresh my 19 recollection. 20 Q. That is, having seen this, does this 21 make you remember something that you didn't remember 22 before? 23 A. No. 24 Q. Are you aware, Mr. Gates, of any 25 documents that were destroyed or disposed of relating 585 1 to the subject matter of this litigation? 2 MR. HEINER: Objection. Vague and 3 ambiguous in view of the Antitrust Division's view of 4 the subject matter of the litigation, apparent view. 5 THE WITNESS: Yeah, help me out with 6 that. 7 Q. BY MR. BOIES: Okay. In the last three 8 years, are you aware of any documents that have been 9 destroyed or disposed of that relate to the issue of 10 Microsoft's conduct with respect to competitors or 11 agreements that Microsoft has entered into with 12 customers or others that restrict the ability of 13 those customers or others to deal with competitors of 14 Microsoft? 15 MR. HEINER: I'd like that pretty long 16 question read back. 17 MR. BOIES: Sure, absolutely. 18 (Record read.) 19 THE WITNESS: No. 20 Q. BY MR. BOIES: Microsoft has a public 21 relations firm; correct? Maybe more than one? 22 A. Yes. 23 Q. Does it have a main public relations 24 firm? 25 A. Yes. 586 1 Q. What is that firm? 2 A. Waggoner Edstrom is the name they go 3 by, I think. 4 Q. Are you aware of any document 5 destruction by or involving Waggoner Edstrom in the 6 last three years? 7 A. No. 8 Q. Are you aware of any destruction or 9 disposal of documents relating to DR DOS? 10 MR. HEINER: Objection. Vague and 11 ambiguous. 12 THE WITNESS: It's possible somebody 13 once upon a time sent an e-mail message to somebody 14 else that DR DOS was part of the subject of that 15 e-mail and then the person deleted that message. 16 Q. BY MR. BOIES: When you say it's 17 possible that someone did that, were you involved in 18 that, Mr. Gates? 19 A. I doubt that every e-mail message I 20 ever received that had the word DR DOS in it, that I 21 choose to preserve forever after. 22 Q. I'm not really asking that question. 23 I'm asking whether there was ever an instance 24 involving you that met the description that you put 25 in your answer about how it may have been possible 587 1 that someone who sent a message that somehow related 2 to DR DOS thereafter deleted a
portion of the 3 message? Do you remember saying that just a minute 4 ago? 5 A. I said nothing about
a portion of the 6 message. That's a completely false thing. 7 Q. Let's read back your answer
so that we 8 don't get distracted about what the words are. 9 (The record was read as follows: 10 "Q. Are you aware of any destruction 11 or disposal of documents relating to DR DOS? 12 MR. HEINER: Objection. Vague and 13 ambiguous. 14 THE WITNESS: It's possible somebody 15 once upon a time sent an e-mail message to 16 somebody else that DR DOS was part of the 17 subject of that e-mail and then the person 18 deleted that message.") 19 Q. BY MR. BOIES: So rather than deleting 20 a portion of the e-mail, you're talking about the 21 whole message being deleted; is that the point you're 22 making? 23 A. That is the words I used and that's my 24 objection to your mischaracterization of what I said. 25 Q. You said it's possible that once upon a 588 1 time somebody sent an e-mail, part of the subject of 2 which was DR DOS, and then this someone unidentified 3 deleted the e-mail. Was that you, sir? Was this 4 someone that you're referring to you? 5 A. I think it's true in general that not 6 every message that everyone here ever received about 7 DR DOS would have necessarily been preserved by them 8 because most people here delete most of the e-mail 9 they receive every day. 10 In terms of me in particular, it's 11 possible that sometime in history -- I'd say it's 12 even likely -- I received a message about DR DOS that 13 I didn't choose to keep. I don't keep most e-mail I 14 receive. 15 Q. Is there a message relating to DR DOS 16 that not only did you choose to delete, but did you 17 ask somebody else to delete? 18 A. No. 19 Q. Is there any message relating to DR DOS 20 that you recall deleting? 21 A. Well, since I delete 98 percent of my 22 e-mails, I think it's likely that once there was a 23 message about DR DOS that I deleted, but I don't 24 recall any specific message. 25 Q. That's what I'm asking. I'm not asking 589 1 what was likely. I'm asking whether there was any 2 message, in whole or in part, relating to DR DOS that 3 as you sit here now under oath you can tell me that 4 you remember deleting or causing to be deleted? 5 A. No. 6 Q. When was the last time you think it is 7 likely that you deleted a message relating to DR DOS? 8 A. Well, I don't think I've gotten a 9 message that related to DR DOS in the last five 10 years. 11 Q. Have you deleted messages not only that 12 you have received with respect to DR DOS but also 13 messages that you have sent? 14 A. I don't preserve messages that I send, 15 so there's no -- 16 Q. You never preserve messages that you 17 send? 18 A. I don't preserve them. There is the 19 extremely rare case, which I've done almost never, 20 where you copy yourself on the e-mail. 21 Q. And you don't either copy yourself or 22 copy some file or something like that? 23 A. No. 24 Q. I just want to be sure of your 25 testimony. Your testimony is you have never asked 590 1 somebody to delete a message that you have sent them 2 relating to DR DOS? 3 A. That's right. 4 Q. And that although you believe that you 5 have deleted messages related to DR DOS that you have 6 received, you can't remember actually having done 7 that and you don't remember any specific message or 8 type of message; is that correct? 9 A. That's right. 10 Q. When was the last time that you deleted 11 e-mail messages concerning Netscape? 12 A. I'm not sure. 13 Q. Approximately. 14 A. I think there was a press article about 15 Netscape that I got a message on recently that I 16 deleted. 17 Q. How recently? 18 A. In the last few months. 19 Q. Who was the message from? 20 A. The New York Times syndicate. 21 Q. Other than that instance, can you 22 recall any instance in which you deleted e-mail 23 messages relating to Netscape in the last year? 24 A. No. 25 Q. Do you believe that there have been 591 1 such instances or there have not been such instances 2 or you simply don't know? 3 A. Are you including the attorney-client 4 privileged e-mail? 5 Q. I will for purposes of this question, 6 yes. 7 A. I don't think I've deleted, other than 8 press articles, e-mail messages related to Netscape 9 during the last year. 10 Q. Are you aware of anyone else within 11 Microsoft who has deleted e-mail messages relating to 12 Netscape in the last year? 13 A. No. 14 Q. Have you ever had any discussions with 15 anyone concerning whether or not any e-mail messages 16 relating in any way to Netscape have been deleted in 17 the last year? 18 A. No. 19 Q. Did Microsoft, insofar as you are 20 aware, make an effort to go back and research its 21 e-mails in order to find particular e-mails that 22 might be useful to it in this litigation? 23 A. I'm not aware of what might or might 24 not have been done in that connection. I know people 25 have come in and looked at my e-mail and whether 592 1 that's just for a request from the governments or 2 also things that they're looking for, I'm not sure. 3 Q. Would it be fair to say that no one has 4 ever communicated with you about any effort to go 5 back and research particular kinds of e-mails or 6 e-mails related to a particular subject? 7 A. You're including attorney-client 8 discussions in that? 9 Q. I am just for purposes of a yes or no 10 answer. 11 MR. HEINER: Objection. 12 MR. BOIES: All I want is yes or no. 13 Last time I asked him I said include attorney-client 14 and the answer was still no. 15 MR. HEINER: But it's a different 16 question. 17 Can I have the question read back. 18 (Record read.) 19 MR. HEINER: I don't think you should 20 include the substance of attorney-client in that 21 question. 22 MR. BOIES: I'll take the attorneys 23 out. I think -- I'll take the attorneys out. 24 Q. Other than conversations that you've 25 had solely with your attorneys, have you ever had any 593 1 discussions with anyone or have you ever received any 2 communications that indicated that there had been any 3 effort to go back and search e-mail messages or files 4 for purposes of this litigation? 5 A. No. 6 What time is it? 7 MR. HEINER: It's noon. Do you want to 8 take a break? 9 THE WITNESS: Probably. 10 MR. HEINER: Okay. 11 MR. BOIES: Absolutely. 12 VIDEOTAPE OPERATOR: The time is 12:00 13 noon. We're going off the record. 14 (Lunch recess.) 15 VIDEOTAPE OPERATOR: The time is 12:38. 16 We are going back on the record. 17 Q. BY MR. BOIES: Good afternoon, 18 Mr. Gates. Let me show you Government Exhibit 382 19 and I would ask you if that is a document that you've 20 ever seen before? 21 A. No. 22 (The document referred to was marked 23 by the court reporter as Government Exhibit 382 for 24 identification and is attached hereto.) 25 Q. BY MR. BOIES: There is a reference in 594 1 this document to "Fiscal Year 1998 WWSMM Attendees." 2 Do you see that? 3 A. Yes. 4 Q. Do you know what that is? 5 A. Yes. 6 Q. What is it? 7 A. World-wide sales and marketing meeting, 8 otherwise known as the WWSMM. 9 Q. Did you attend the fiscal year 1998 10 WWSMM? 11 A. No, I don't attend that. I come in and 12 speak usually at the end of it, but I don't attend 13 it. 14 Q. The subject matter of this is the 15 "Fiscal Year 1998 Planning Memo 'Preserving the 16 desktop paradise.'" 17 Are you familiar with that? 18 A. I don't know what you mean am I 19 familiar with that. I know fiscal year '98. 20 Q. Have you ever seen the Fiscal Year 1998 21 Planning Memo? 22 A. The one from Brad Chase? No. 23 Q. Have you seen a Fiscal Year 1998 24 Planning Memo from somebody else? 25 A. There's a lot of these. Each group 595 1 writes planning memos. I'm not copied on most of 2 them. 3 Q. Are there planning memos from some of 4 the groups that you recall receiving for fiscal year 5 1998? 6 A. I think there's a memo Steve wrote that 7 was probably sent to me. 8 Q. And by Steve you're referring to 9 Mr. Ballmer? 10 A. Yes. 11 Q. In the third paragraph of this memo on 12 the first page it says "Our competitors are still 13 hard at work trying to obsolete Windows. More people 14 than ever now believe they will. Netscape and Sun 15 endeavor to commoditize the OS." 16 Do you know what is meant by 17 "commoditize the OS" in this context? 18 A. In the context of this memo? 19 Q. Yes. 20 A. I'd need to read the memo. 21 Q. Have you ever heard anybody say that 22 Netscape or Sun threatened to commoditize the 23 operating system? 24 A. Yes. 25 Q. Have you ever said that? 596 1 A. Those words? 2 Q. Yes. 3 A. I don't think so. 4 Q. When other people have said those 5 words, what have you understood them to mean? 6 A. I think the first time I heard that was 7 from Marc Andreessen. And I never had a chance to 8 ask him what he meant. 9 Q. Have you heard those words from people 10 within Microsoft? 11 A. Subsequently to Andreessen using those 12 words, I know they were repeated inside the company 13 quite a bit. 14 Q. Did you understand that some people 15 within Microsoft were saying that they believed that 16 Netscape or Sun were threatening to commoditize the 17 operating system? 18 A. I don't know of anybody using that 19 terminology before Andreessen did. I don't think it 20 was used before he used it. 21 Q. My question is not whether it was used 22 before or after Mr. Andreessen's statement. My 23 question is whether people within Microsoft 24 communicated with you that they believed that 25 Netscape or Sun threatened to commoditize the 597 1 operating system? 2 A. It says "endeavor" here and you're 3 switching? 4 Q. I was asking a question that was not 5 necessarily tied to the document. My question is 6 whether anyone within Microsoft told you that they 7 believed that Netscape or Sun threatened to 8 commoditize the operating system? 9 A. Those specific words? 10 Q. Yes, the same words we've been using in 11 the last previous series of questions, Mr. Gates, 12 those words. 13 A. I think that most of the time when 14 people use those words, they were repeating what 15 Andreessen had said. 16 Q. My question is not what they meant most 17 of the time or what they were doing most of the time. 18 My question is whether people within Microsoft ever 19 communicated to you that they believed that Netscape 20 or Sun were threatening to commoditize the operating 21 system? 22 A. Well, they certainly communicated to me 23 that Netscape was communicating that they were on a 24 path to, in Netscape's words, commoditize the 25 operating system. 598 1 Q. Have you finished your answer? 2 A. Yes. 3 Q. Now, my question is whether anyone 4 within Microsoft ever communicated to you that they 5 believed that either Netscape or Sun were threatening 6 to commoditize the operating system? 7 A. I think after Andreessen said it, some 8 people suggested they agreed with Andreessen's 9 sentiment that Netscape was trying to reduce Windows 10 sales. 11 Q. When people used the word with you 12 "commoditize" as in the statement that Netscape was 13 threatening or endeavoring to commoditize the 14 operating system, what did you understand commoditize 15 to mean? 16 A. That they were creating a product that 17 would either reduce the value or eliminate demand for 18 the Windows operating system if they continued to 19 improve it and we didn't keep improving our product. 20 Q. Did you have any other understanding of 21 the term "commoditize" in that context? 22 A. Well, it was a word that was used to 23 refer to Andreessen's comment. 24 Q. Other than that, did you have any 25 understanding of the meaning of the term 599 1 "commoditize" in that context? 2 A. Other than those two things? 3 Q. Yes. 4 A. No. 5 Q. Let me show you next a document that 6 has been marked as Exhibit 383. This purports to be 7 an e-mail from Mr. Maritz to you and others with 8 charts attached to it. 9 (The document referred to was marked 10 by the court reporter as Government Exhibit 383 for 11 identification and is attached hereto.) 12 Q. BY MR. BOIES: First, have you seen 13 this e-mail before? 14 A. I think Mr. Houck showed it to me. 15 Q. You may be right in a sense, Mr. Gates, 16 in the sense that I think that your counsel has 17 produced to us various versions of documents. I do 18 not believe that this particular version, which was 19 produced to us stapled this way, was shown to you by 20 Mr. Houck. 21 A. When you ask me whether I'd ever seen 22 the e-mail before, I wasn't referring to the way it 23 was stapled. 24 Q. This happens to have various charts 25 attached to it. Have you ever seen this e-mail with 600 1 these charts attached to it? 2 A. Can I look back through the old 3 exhibits? 4 Q. What I'd -- yes, you can. You can do 5 whatever you want to answer the question, but what 6 I'd like you to do is I'd like to get an answer to 7 this question with respect to Exhibit 383. If you 8 need to look back at the other exhibits to answer 9 this question, then you can do whatever you need to. 10 A. You've asked me if I've ever seen 11 something before and I'm thinking maybe a previous 12 exhibit had some or part of this. And therefore, to 13 answer your answer question, I need to look at the 14 exhibits to see if that's the case or not. 15 Q. Let me see if I can move things along. 16 Did you receive this e-mail in or about January, 17 1997, this e-mail being a message from Paul Maritz to 18 you and others dated January 5, 1997? 19 A. I don't remember receiving it, but I 20 don't have any reason to doubt that it was sent. 21 Q. Did you see this e-mail at any time 22 prior to the commencement of your deposition last 23 week? 24 A. I don't remember seeing it. 25 Q. The subject of this e-mail is "Overview 601 1 slides for Billg/NC & Java session with 14+'s on 2 Monday." Do you see that? 3 A. Yes. 4 Q. And I think you identified the 14+'s 5 as the -- some group of executives; is that correct? 6 A. No. 7 Q. What is the 14+'s? 8 A. It's people above a certain level, 9 primarily engineers. Also executives, but mostly 10 engineers. 11 Q. It's all the people in the company 12 above a certain level, the 14 level? 13 A. Which are mostly engineers and not 14 executives. 15 Q. How many people are there in the 14+'s 16 group? 17 A. It's a good question. I think around 18 200 to 300. 19 Q. And these would be the people in the 20 200 or 300 top rated jobs in the company; is that 21 correct? 22 A. If top means the best compensation, 23 yes. 24 Q. Now, do you recall the slides that are 25 attached to this e-mail? 602 1 A. I remember when I testified earlier 2 seeing these and saying that I was pretty sure that I 3 never presented these slides. 4 Q. Do you recall whether someone else 5 presented these slides in January of 1997? 6 A. I'm not sure. I remember looking at 7 the slides and thinking probably not. 8 Q. Let me ask you to look at the third 9 page of the exhibit, which is headed "Key Platform 10 Challenge." It is page 2 of the charts and page 3 of 11 Exhibit 383, in which it says "NC & Java are platform 12 challenges." Do you see that? 13 A. Uh-huh. 14 Q. Did you believe in January of 1997 that 15 Java was a platform challenge? 16 A. Not Java the language, but some of the 17 Java runtime APIs that were being promoted to ISPs in 18 the way that Sun and others were talking about 19 enhancing them were platform challenges. 20 Q. When reference is made here to Java, do 21 you understand that to refer to what you refer to as 22 Java runtime APIs? 23 A. I'm not sure. 24 Q. Are you aware of people asserting that 25 Java runtime APIs were a platform challenge in or 603 1 about January of 1997? 2 A. I just told you that we looked at what 3 was going on in terms of the plans of Sun and other 4 people with Java runtime APIs as being a platform 5 challenge. 6 Q. Are you aware of any other platform 7 challenge represented by Java other than Java runtime 8 APIs? 9 A. No. 10 Q. So would it be fair to say that you 11 believe that when reference is made here to Java, the 12 reference means Java runtime APIs since it asserts 13 here that Java is a platform challenge? 14 A. It's the best way to make sense of a 15 document that I haven't seen until my deposition, as 16 far as I know. 17 Q. Let me show you a document that has 18 been marked as Exhibit 397. This purports to be a 19 message to you and others from Brad Chase dated 20 March 13, 1997. 21 Did you receive this message in or 22 about March of 1997? 23 A. I don't remember receiving it. In 24 fact, it's very strange that the e-mail names aren't 25 expanded. But I probably received it. 604 1 (The document referred to was marked 2 by the court reporter as Government Exhibit 397 for 3 identification and is attached hereto.) 4 Q. BY MR. BOIES: Let me go down to the 5 third paragraph of the document and the fifth 6 sentence that says "Browser share needs to remain a 7 key priority for our field and marketing efforts." 8 Do you see that? 9 A. In the third paragraph? 10 Q. Yes. 11 A. Okay, the third sentence, the third 12 paragraph. Yeah. 13 Q. Were you told in or about March of 1997 14 that people within Microsoft believed that browser 15 share needed to remain a key priority for your field 16 and marketing efforts? 17 A. I don't remember being told that, but I 18 wouldn't be surprised to hear that people were saying 19 that. 20 Q. Immediately before that sentence there 21 is a statement that Microsoft needs to continue its 22 jihad next year. Do you see that? 23 A. No. 24 Q. The sentence that says "Browser share 25 needs to remain a key priority for our field and 605 1 marketing efforts," the sentence right before that 2 says "we need to continue our jihad next year." 3 That's the way it ends. Do you see that? 4 A. Now I see -- it doesn't say Microsoft. 5 Q. Well, when it says "we" there, do you 6 understand that means something other than Microsoft, 7 sir? 8 A. It could mean Brad Chase's group. 9 Q. Well, this is a message from Brad Chase 10 to you, Brad Silverberg, Paul Maritz and Steve 11 Ballmer; correct? 12 A. As I say, it's strange that this -- if 13 this was a normal piece of e-mail, it wouldn't print 14 like that. I'm not aware of any way -- maybe there 15 is some way -- that e-mail ends up looking like this 16 when you print it out. 17 Q. I wasn't the one that was asserting it 18 was an e-mail. I don't know whether it is an e-mail 19 or memo or what it is. All I know is it was produced 20 to us by Microsoft. And the first line of it says 21 "To" and the first name there is "Bradsi." Do you 22 see that? 23 A. Uh-huh. 24 Q. Does that refer to Brad Silverberg? 25 A. Usually you can use that shorthand in 606 1 typing in someone's name, but when you print out 2 e-mail, it doesn't come out that way. 3 Q. Do you believe that the reference here 4 to "Bradsi" is a reference to Brad Silverberg, sir? 5 A. Yes. 6 Q. The next addressee is "Paulma." Do you 7 believe that that is Paul Maritz? 8 A. Yes. 9 Q. And the next addressee is "Steveb". Do 10 you believe that that is Steve Ballmer? 11 A. Yes. 12 Q. The next addressee is "Billg" and do 13 you believe that that is yourself? 14 A. Yes. 15 Q. And it says it's from "Bradc" and do 16 you believe that is Brad Chase? 17 A. Yes. 18 Q. Now, when Brad Chase writes to you and 19 the others "we need to continue our jihad next year," 20 do you understand that he is referring to Microsoft 21 when he uses the word "we"? 22 A. No. 23 Q. What do you think he means when he uses 24 the word "we"? 25 A. I'm not sure. 607 1 Q. Do you know what he means by jihad? 2 A. I think he is referring to our vigorous 3 efforts to make a superior product and to market that 4 product. 5 Q. Now, what he says in the next sentence 6 is, "Browser share needs to remain a key priority for 7 our field and marketing efforts;" is that correct? 8 A. Yes. 9 Q. The field and marketing efforts were 10 not involved in product design or making an improved 11 browser, were they, sir? 12 A. No. 13 Q. Let me show you next a document that 14 has been marked as Exhibit 384. 15 MR. HEINER: Which number is this now? 16 MR. BOIES: 384. 17 (The document referred to was marked 18 by the court reporter as Government Exhibit 384 for 19 identification and is attached hereto.) 20 Q. BY MR. BOIES: I want you to look at 21 the second message that is on this exhibit. In the 22 middle of the first page is a message from Steven 23 Sinofsky. Do you see that? 24 A. Uh-huh. 25 Q. And it is dated June 10, 1994. There 608 1 is one name that it's hard to read on the copy that 2 we were produced, but I don't believe that you were 3 shown as receiving a copy of this exhibit, at least 4 back in 1994. 5 Have you seen this message before, sir? 6 A. Not before this lawsuit. 7 Q. When did you first see it? 8 A. I think sometime during the course of 9 the lawsuit. 10 Q. That is, sometime in the last six 11 months? 12 A. That's right. 13 Q. Have you discussed this with anyone in 14 Microsoft, other than your counsel? 15 A. Yeah, I think I had a short 16 conversation with Mitch Matthews on the general 17 topic, not on this specific message. 18 Q. What was the general topic that you 19 refer to? 20 A. The history of our decision to put 21 browsing functionality into Windows. 22 Q. There is a reference here to Chicago. 23 Is that a reference to Windows? 24 A. It's a code name that was used for what 25 became Windows 95. 609 1 Q. The third paragraph of this e-mail says 2 "We do not currently plan on any other client 3 software, especially something like Mosaic or Cello." 4 Do you see that? 5 A. I see it. 6 Q. You've identified Mosaic as a browser; 7 correct, sir? 8 A. Yes. 9 Q. Do you know what Cello is? 10 A. No. 11 Q. Were you informed in or about June of 12 1994 that people within Microsoft did not currently 13 plan on including something like Mosaic or Cello in 14 Windows 95? 15 A. Quite the opposite. 16 Q. So it's your testimony that this is 17 just not accurate, is that what you're saying? 18 MR. HEINER: Objection. 19 THE WITNESS: What are you referring 20 to? 21 Q. BY MR. BOIES: Well, I'm referring to 22 this document. And what this document says is, "We 23 do not currently plan on any other client software, 24 especially something like Mosaic or Cello." And you 25 understand this to mean that you're not currently 610 1 planning on including something like Mosaic or Cello 2 in Chicago; correct, sir? 3 A. I guess I'd read the whole e-mail 4 message if I was really interested. And I've gone 5 ahead and done that. So you're trying to take that 6 sentence just out by itself or you're trying to get 7 me to talk about what the e-mail itself is saying? 8 Q. What I'm trying to do is get you to 9 tell me whether, as you understand it, Mr. Sinofsky 10 is writing here on June 10, 1994, that at least 11 insofar as he is concerned, there is not a plan to 12 include something like Mosaic or Cello in Chicago? 13 Is that what he is saying here? 14 A. No. 15 Q. That's not what he is saying. 16 Let's go to the previous paragraph. 17 He says, "I think it is really important that we 18 stick to the basic facts of the situation and not 19 over commit Chicago or Microsoft in any way. The 20 Chicago message is 'all the plumbing you need to 21 connect to the Internet,' which translates to TCP/IP 22 stacks, SLIP and PPP, and the basic FTP and TELNET 23 clients. Our built-in client (and our NT server) 24 will also support Internet protocols such as SMTP and 25 MIME." 611 1 He then continues in the very next 2 sentence "We do not currently plan on any other 3 client software, especially something like Mosaic or 4 Cello." 5 Are any of the things that Mr. Sinofsky 6 indicates here are going to be included in Chicago 7 software that you would consider to be browser 8 software? 9 A. The e-mail I'm looking at talks about 10 the Chicago message and this is -- he seems to be 11 talking about what we're saying externally about the 12 Chicago project. This e-mail doesn't include anyone 13 who is involved in deciding what's in Chicago, and so 14 he is talking about the Chicago message here. 15 Q. Mr. Gates, my question is whether any 16 of the software that Mr. Sinofsky identifies here as 17 being included in Chicago is software that you 18 considered to be browser software? 19 A. Where do you see the phrase "included 20 in Chicago"? 21 Q. Well, sir, when he says "The Chicago 22 message is 'all the plumbing you need to connect to 23 the Internet,' which translates to TCP/IP stacks, 24 SLIP and PPP and the basic FTP and TELNET clients. 25 Our built-in mail client (and our NT server) will 612 1 also support Internet protocols such as SMTP and 2 MIME," when he says those things, do you believe he 3 is saying that those are going to be included in 4 Chicago? 5 A. No. He is saying the Chicago message 6 is... 7 Q. So what you're saying is that when he 8 says the Chicago message is that, he doesn't mean 9 that you're going to include in Chicago what he then 10 lists; is that what you're saying? 11 A. He is saying that the Chicago message 12 may imply that. 13 Q. But that's what I'm asking you. What 14 I'm asking you is whether you read this document as 15 saying that TCP/IP stacks, SLIP and PPP and the basic 16 FTP and TELNET clients are going to be included in 17 Chicago? Do you read it that way? 18 A. No. 19 Q. Okay. And when he says "Our built-in 20 mail client and our NT server will also support 21 Internet protocols such as SMPT and MIME," do you 22 believe that he is saying that your built-in mail 23 client and your NT server are going to come out with 24 Chicago? 25 A. Certainly not. 613

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