Microsoft's Antitrust Trial: Intuit's Critical Testimony Reveals Browser Bundling Tactics

Intuit Inc. chief executive William Harris testified in the Microsoft antitrust trial, revealing that the company would have chosen to bundle both Internet Explorer and Netscape Navigator with its Quicken personal finance software in 1997, but was prevented from doing so by a clause in its agreement with Microsoft. Harris clarified that his company's decision-making process was influenced by Microsoft's tie-in of the active desktop deal to the bundling of Internet Explorer, leaving Intuit with an "impossible position."

Key Takeaways:

• Intuit would have bundled both Internet Explorer and Netscape Navigator with its Quicken software in 1997, but was prevented from doing so by a clause in its agreement with Microsoft.
• Microsoft tied the active desktop deal to the bundling of Internet Explorer, leaving Intuit with an "impossible position."
• The agreement between Microsoft and Intuit was negotiated in April 1997, with the two companies discussing "Platinum-level" placement on the active desktop push channel bar.
• Intuit's chief executive, William Harris, testified that the company would have provided more choice by bundling both browsers in the absence of the active desktop consideration.
• Microsoft'sSenior Business Development Manager, Will Poole, forwarded an email to Microsoft VP Brand Chase and others, indicating that Intuit was obliged to bundle IE3 with Quicken and IE4 with other products, and exclusively display the IE logo on Intuit's websites.
• The government argues that Microsoft's actions put Intuit in an impossible position, leading it to abandon Netscape in favor of Microsoft in return for IE and a prominent place on the active desktop.
• Microsoft's CEO, Bill Gates, was shown in a video deposition, where he had no recollection of seeing the email from Will Poole, and had difficulty understanding the terms "differentiated content" as used in the agreement.
• The government resurrected its tactic of playing segments of the long Bill Gates video deposition, this time relating to the deal with Intuit.

Statistics:

• 1997: The year in which Intuit made its decisions about which browser to bundle with its Quicken software.
• Two: The number of decisions Intuit was asked to make in the spring of 1997, regarding which browser to integrate with Quicken and whether to change its bundling strategy.
• One: The maximum duration of the deal between Intuit and Microsoft, as specified by Microsoft.
• Platinum-level: The placement that Intuit sought on the active desktop push channel bar, which would have provided the company with one of the best positions on the active desktop.
• Exclusive logo display: The condition that Microsoft imposed on Intuit, requiring the company to exclusively display the IE logo on its websites.

Sources:

• William Harris, chief executive of Intuit Inc.
• David Boies, lead government attorney
• Will Poole, Microsoft Senior Business Development Manager
• Bill Gates, Microsoft CEO
• Mark Murray, Microsoft representative
• Various reporters and news outlets (no specific sources mentioned in the text)