ROANOKE TIMES
Copyright (c) 1995, Roanoke Times
DATE: Tuesday, December 5, 1995 TAG: 9512050062
SECTION: BUSINESS PAGE: C-8 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: Associated Press
COMPETITORS' COMPLAINTS that Microsoft designed its new Windows 95 software to foil their Internet-accessing products has the Justice Department investigating the world's dominant software maker.
Justice Department investigators want to know if Microsoft Corp. deliberately designed Windows 95 software to hamper rival services that let users connect to the global computer network known as the Internet.
Microsoft said Monday that some problems arose during testing this year, but the world's leading maker of personal computer software said those problems were resolved with the newer versions of most competitors' products.
The investigation marks another government effort to scrutinize the fair-play practices of Microsoft, one of the most successful American businesses in the fast-growing computer technology industry.
The Redmond, Wash.-based company has been dogged for years by questions about whether its dominant position in PC software amounts to a near-monopoly that hurts competition.
The Justice Department's antitrust division last month issued civil subpoenas to Netscape Communications Corp. and CompuServe Inc. on-line service, said Don Baker, a Washington lawyer representing CompuServe. A CompuServe spokesman also confirmed the investigation.
The subpoenas indicate Justice investigators are focusing on whether Microsoft's Windows 95 and its related Internet software either disable or raise the costs of rival programs that let users access the Internet.
Windows 95, Microsoft's upgraded operating system for PCs, debuted in August with great marketing fanfare.
The extent of the Internet software problem was unclear. A CompuServe spokesman said its browser software for gaining access to the World Wide Web portion of the Internet now works with Windows 95, but only after additional cost.
``We have had to take active steps with actual costs to make sure the system runs properly,'' CompuServe spokesman Jeff Shafer said.
A continuing theme of the Microsoft antitrust investigation has been whether Microsoft designed Windows 95 and its on-line service, Microsoft Network, to gain a pricing advantage over rivals.
Baker, the CompuServe attorney, went further, suggesting Windows 95 was designed to hobble rival programs.
``For a dominant firm to deliberately disable competitors in a dependent market raises serious antitrust concerns,'' Baker said.
Microsoft spokesman Greg Shaw said such charges were ``absolutely nonsense.''
He said a conflict with competitors' software arose in the testing of Windows 95, which isn't unusual. He understood that the issue largely had been resolved. Microsoft wants Windows 95 to run well with rival Internet software, because any problems would make the operating system less popular in the industry, he added.
Some industry analysts agreed that Microsoft couldn't have deliberately plotted to disable competitors' programs.
``I can't imagine that they would intend to do it,'' said Peter Krasilovsky, senior analyst at Arlen Communications, a consulting firm in Bethesda, Md.
The Justice Department inquiry apparently had no effect on investors, who bid up Microsoft stock by $1.621/2 a share to $87.871/2 on Nasdaq.
Windows 95, as operating system software, controls such basic computer functions as printing or storage of words and data. The program, installed on an estimated 10 million computers, is expected to become the standard for the personal computer market.
LENGTH: Medium: 71 linesby CNB