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Gates Decries 'Witch Hunt' Against Microsoft

Technology: Ralph Nader says software firm's chief is 'refusing to address the issues.'

November 15, 1997|From Reuters

WASHINGTON — Microsoft Corp. magnate Bill Gates and consumer advocate Ralph Nader traded barbs across 3,000 miles Friday, hurling bitter accusations over a two-day Washington conference scrutinizing the company's business practices.

Gates charged at a shareholders meeting in Seattle that the Nader conference and government investigations of Microsoft are creating a "witch hunt" atmosphere that could aid his competitors.

Nader, who was turned down by Gates and other top Microsoft officials for appearances at the conference, called the statement a "paranoid style of response . . . typical of Bill Gates and too many Microsoft top executives."

At the conference itself, a Texas law enforcement official called on potential witnesses to come forward and help build a case against the huge software company.

"You have to help us help you," said Sam Goodhope, special assistant to Texas Atty. Gen. Dan Morales. "You're complaining a lot, but you've got to come forward. If you're afraid to give us information, it doesn't do us any good."

One theme of the conference was that Microsoft has used intimidating tactics to defeat competitors.

The Texas attorney general's office sued Microsoft last week, asking a judge to nullify secrecy agreements that require other companies to notify the Redmond, Wash.-based software giant before talking to government investigators.

A Microsoft spokesman said such secrecy agreements are standard in the industry.

Gates said the government investigations of his company and the Nader conference aim to hurt Microsoft and help its competitors.

He suggested Nader was acting because he was getting money from Microsoft competitors, who were well-represented at the conference.

"We do have some competitors who have chosen to fund these things and promote these activities in order to handicap Microsoft in the competitive market," Gates said.

Nader said Gates was "refusing to address the issues raised at the conference. . . . He is still in virtual reality and out of touch with what is the growing public challenge to his company's power abuses and intimidations."

Gates' response was part of a coordinated campaign by Microsoft to counter increasing attacks on its expansion into new markets.

The Justice Department is in court against Microsoft in Washington, alleging that it violated a 1995 consent decree that was supposed to ease the way for more competition in the software industry. It has also asked a federal judge to nullify the secrecy agreements.

Attorneys general in half a dozen states--along with antitrust authorities in the European Union and Japan--are investigating Microsoft for anti-competitive practices.

Microsoft, which has a 90% share of the market for personal computer operating systems, has denied in court filings that it holds a monopoly.

It is legal to hold a monopoly in the United States, but it is not legal to use monopoly power to achieve dominance in other areas.

Shares of Microsoft closed at $133.31, up $1.75 on Nasdaq.

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