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  Justice Renews Antitrust Scrutiny of Microsoft

By David S. Hilzenrath and Elizabeth Corcoran
Washington Post Staff Writers
Friday, September 20, 1996; Page F01

The Justice Department has renewed its scrutiny of alleged antitrust violations by Microsoft Corp., this time seeking information on the software giant's Internet browser software.

Microsoft, which disclosed the development yesterday, said that it would cooperate and attributed the government's request to "complaints from competitors."

"The facts will show that Microsoft is competing vigorously and legally, and our efforts are benefiting consumers," Microsoft Senior Vice President William H. Neukom said in a statement issued by the company.

A Justice Department spokesman said only that "we have an ongoing investigation and it's continuing."

Netscape Communications Corp., Microsoft's major rival in the market for software used to surf the Internet, last month wrote to the Justice Department asking regulators to examine possible antitrust violations in the marketing and distribution of Microsoft's Internet Explorer software.

Gary Reback, a lawyer for Netscape, argued that Microsoft was unfairly offering computer makers financial "inducements" for giving Microsoft's Internet software an exclusive place on their computers, or for making Netscape's product "far less accessible to users."

Microsoft dismissed those claims as "wild and untrue."

The battle of the software that helps users find their way on the Internet, such as Microsoft's Explorer and Netscape's Navigator, is particularly intense because these products are among the most coveted spots for ads and links to various Web sites.

Micrososft, based in Redmond, Wash., previously has been the focus of antitrust inquiries. In 1994, Microsoft signed a consent decree with the government agreeing to end licensing practices that the government contended stifled competition and inflated prices for personal computer operating systems such as Windows. Microsoft denied that it had done anything wrong.

Last year, the Justice Department opposed Microsoft's planned $2 billion purchase of Intuit Inc., maker of Quicken personal finance software. Microsoft dropped the deal and agreed to pay Intuit $46.2 million for its trouble. In December, the on-line services CompuServe Inc. and Prodigy Services Co. said they had received Justice Department subpoenas for information related to Microsoft.

"The stakes now are higher than they've ever been in any of the prior Microsoft investigations," Reback said yesterday. "If any one company monopolized the Internet, that would be a monopoly the scope of which AT&T [the former long-distance telephone monopoly] could only have dreamed of."

Microsoft's Neukom accused unnamed competitors of waging "a public relations campaign of baseless allegations designed to divert attention from the quality of our technology."

© Copyright 1998 The Washington Post Company

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