Microsoft troubled by tell-all book
Silicon Valley / San Jose Business Journal - by Erik Espe Business Journal Staff Writer
Microsoft Corp. says it is "troubled" by a new book that exposes never-before-released memos and accuses the company of everything from bugging hotel rooms to obstructing justice.
"Eighty percent of the e-mails I quoted in the book are still under seal," said Illinois-based writer Wendy Goldman Rohm, whose book "The Microsoft Files" is due to hit stores Sept. 8.
She won't say how she acquired the e-mails and quotations from meetings within the company--only that she has sources at the "highest levels" from 10 years of covering the firm for Wired, Red Herring, the Chicago Tribune, the Boston Globe and a number of other publications.
Some of the allegations leveled at the Redmond, Wash.-based company and others in the book are explosive:
• Microsoft bugged the Las Vegas hotel room of senior IBM executive James Cannavino during a conference in 1989.
• Microsoft has withheld information from federal investigators working in the antitrust suit against the company. "There are documents published in the book that were never turned over to the feds by Microsoft," Ms. Rohm said.
• Microsoft incorporated bugs into its software and operating systems so they would not work with competitors' products.
• Microsoft officials routinely traded e-mails discussing ways to "kill" their competitors.
In one never-before-released memo quoted in the book, Jim Allchin, a senior vice president at the company, wrote in 1993 regarding Microsoft rival Novell Inc.: "If you're going to kill someone there isn't much reason to get all that worked up about it and angry. You just pull the trigger. Angry discussions beforehand are a waste of time. We need to smile with Novell when we pull the trigger."
Microsoft representative Mark Murray said that quote was taken out of context.
"The author has chosen to extract only a tiny snippet of the entire document," he said.
"The entire document says the exact opposite of what the author claims it says."
He also said the allegations about the bugged hotel room in Las Vegas "are completely false."
"Based on our review, we think bookstores should file the book in their fiction sections," he said.
The book's portrayal of founder Bill Gates is especially unflattering. He's described as "an ill-kempt, socially inept, scrawny, insecure, ruthless Lex Luthor."
"He's very paranoid," Ms. Rohm said in a phone interview with The Business Journal. "Whenever the tiniest company gets the teeniest toe-hold in a new market, he's just beside himself with doing something about it."
One of the companies that has especially irked Mr. Gates, according to Ms. Rohm, is Mountain View-based Netscape, which enjoyed a 70 percent share of the Internet browser market in 1995.
Today, that share has dropped to just above 50 percent, thanks to an aggressive campaign by Microsoft to make its Internet Explorer the market's leading product.
Microsoft has argued that its browser gained market share simply because it is a superior product. But critics such as watchdog group NetAction have charged that Microsoft cut deals with Internet service providers--arrangements that would fall into the category of "illegal, anti-competitive practices" cited by the U.S. Department of Justice and 20 states when they filed suit against Microsoft in May.
Ms. Rohm said Microsoft felt threatened by the notion that browsers could someday replace operating systems, so it became obsessed with Netscape. She sees it as a sign of Mr. Gates' paranoia.
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