Mr Bill Gates, chief executive of Microsoft, was yesterday accused of misrepresenting under oath his company's aggressive campaign to control the market in internet software.
In a stunning opening to the US government's landmark antitrust trial, government lawyers placed Mr Gates - whose evidence was shown in court on video tape - at the centre of a web of illegal deals to carve up the internet market with rivals and customers.
Microsoft is charged with breaking antitrust laws by abusing its monopoly power over Windows - the operating software which drives 90 per cent of personal computers. It is also accused of seeking to co-opt rivals in its battle to crush Netscape Communications, the internet software pioneer.
According to attorneys for the US justice department and 20 states, Microsoft feared its dominance would be undermined by Netscape's browser, which allows computer users to read thousands of pages of information on the world wide web.
Antitrust attorneys said Mr Gates' testimony about a June 1995 meeting with Netscape executives was contradicted by his own memos and e-mails at the time.
The government alleges Microsoft used the meeting to convince Netscape to back away from Windows markets in return for freedom to pursue the market in business server computers.
On video tape, Mr Gates said the first he knew of any alleged efforts to carve up the market with Netscape was a newspaper article published earlier this year. "It is very much against the way we operate," he said.
However, the government quoted from a series of documents written by Mr Gates which suggest otherwise. One memo about Netscape sent to Microsoft executives, which was cited in court, said: "Of course over time we will compete on servers, but we can help them a lot in the meantime. We could even pay them money as part of a deal buying some piece of them or something."
According to the government, when Netscape refused to co-operate, Microsoft set about destroying its rival's revenues by distributing its own browser free of charge and forcing its customers to block Netscape's products.
Mr Gates allegedly sought to enlist the help of rivals, particularly America Online, the internet company which competes directly with his MSN online service. A memo from America Online executives quoted Mr Gates saying: "Gates offered a characteristically blunt query: how much do we need to pay you to screw Netscape? This is your lucky day."
When other companies - including computer and hardware makers - resisted Microsoft's advances, they were allegedly bullied into submission.
Antitrust officials suggested they would be seeking broad - but unspecified - sanctions against Microsoft to stop the company's illegal business practices. The trial is expected to continue with the opening of Microsoft's defence today.
