WASHINGTON --
Senate Judiciary Committee Chairman Orrin Hatch, R-Utah, has, in recent weeks, emerged as one of Capitol Hill's most outspoken critics of Microsoft -- and one of Washington's most strident advocates of government regulation of the Internet.
In a speech Feb. 5, Hatch urged the formation of an "Internet Commerce Commission" to regulate online commerce -- if Microsoft were to achieve "control" over the medium.
Now, Hatch wants Microsoft to answer to Congress.
Next Tuesday, Hatch will convene a hearing by his powerful committee to probe allegations by Microsoft rivals that the company exploits an operating-system monopoly to reduce choice in the marketplace. The software giant has also been fighting the Justice Department in a dispute over its compliance with a 1995 antitrust settlement.
Microsoft chairman Bill Gates and his arch rivals, Jim Barksdale, president of Netscape, and Scott McNealy, president of Sun Microsystems, are scheduled to testify at the hearing, to be titled "Market Power and Structural Change in the Software Industry."
In an interview outside Senate chambers with Salon, Hatch said Gates threatened to boycott the hearing -- unless Hatch allowed two other pro-Microsoft witnesses besides himself to defend Microsoft before the committee: "Gates complained the original panel was too unbalanced against Microsoft," the senator said.
According to committee sources Wednesday, Gates has requested that Michael Dell, CEO of Dell Computer, and Doug Burgum, chairman of Great Plains Software, appear with him before the panel to defend Microsoft against the complaints.
McNealy, Barksdale, Gates, Dell and Burgum would make up one of the wealthiest panels ever to appear before a Senate committee. The value of Gates' Microsoft stock alone approaches $44.4 billion; Dell is a multibillionaire too. The anti-Microsoft contingent isn't quite in the same league: In a survey conducted last September by a Forbes publication, McNealy's fortune was estimated at $417 million, and Barksdale's at $198 million.
The Judiciary Committee has been collecting documents from Microsoft as part of an investigation of anti-competitive practices in the software industry. Hatch's home state of Utah is home to Microsoft competitor Novell.
Salon interviewed Hatch Tuesday, outside Senate chambers.
The Justice Department has been investigating Microsoft for months. Why are you holding these hearings, and why now?
We have the oversight responsibility of antitrust, and we've had many complaints from the various software producers in Utah, Massachusetts and California. Many people are intimidated to speak out against Microsoft publicly, and this hearing is simply to lay things out in the open and give oversight to the whole antitrust matter.
Why, in your view, are these people intimidated?
Because Microsoft owns the underlying computer operating system, so therefore some feel Microsoft has used that monopoly to unfairly prejudice competition in other ways. Now, I'm not sure that is so. But the antitrust division of the U.S. Justice Department is certainly concerned about it, and we're naturally concerned about it, too. So we're going to have a hearing where basically three people will testify, basically, for Microsoft's position -- which we're happy to do -- and two will testify, I presume, against Microsoft. I don't know exactly what they'll say, and I'm not precisely certain of who the two other people besides Gates will be to testify on Microsoft's behalf.
Is Gates confirmed to attend? Netscape says its president, Jim Barksdale, won't testify without Gates in the room.
Yes, Gates will be there. You have to have both sides at a hearing like this. But I must say, it wasn't certain we would have all sides. We originally invited Gates, Barksdale and Scott McNealy, the president of Sun Microsystems. Barksdale and McNealy are big rivals of Microsoft. Well, Bill Gates called and complained that he felt the hearing seemed unbalanced. I said fine, we'll balance it up. And Bill suggested we also have these other two people speaking on behalf of Microsoft. I said fine. I don't care. In fact, it's probably better to have it overbalanced his way, since he's the one that is being looked at by Justice.
What makes Microsoft different in your view from, say, any other company -- an oil company, for example? Or is there no real difference?
Well, of course, there's a considerable difference, business-wise. But from an antitrust standpoint, there's no reason for anybody to have unlawful tie-ins or predatory conduct or to use a monopoly to interfere with freedom of competition. So if, in fact, Microsoft is doing that, then something has to be done to stop that. And that's what the Justice Department is looking into. And that's what we, too, as part of our oversight responsibility, are trying to figure out. We want to figure out what's going on here for ourselves.
You've been quite outspoken in your criticisms of Microsoft's methods of marketing its software. You've called for the formation of an Internet Commerce Commission to regulate the software industry if Microsoft doesn't change its marketing methods. Is there any doubt in your mind what's going on?
I haven't made any judgments. I'm just saying we have plenty of complaints from many other companies about Microsoft. Microsoft complains back. In this hearing, we'll let the two sides vent their feelings.
OK, but why hold a hearing now? The Justice Department has been looking into these allegations for nearly a year. You've got some Microsoft rivals in your district, in Utah. They've been urging you to hold a hearing like this for a while now. Why haven't you, as chairman of the Judiciary Committee, acted sooner?
I have to say that it's true -- I've been late looking into this. We should have looked into this a long time ago. We've been getting increasing numbers of complaints from competitors of Microsoft. I'm personally concerned about hundreds of such companies in my district. We, in Utah, have one of the three software valleys -- in addition to Silicon Valley and the software valley in Massachusetts. I'm a strong supporter of our industries and businesses in Utah. But we're also getting an equal number of complaints from companies in the other two software valleys, in Massachusetts and California. And a lot of the complaints are by people who are afraid to speak out because they're afraid that Microsoft would use its monopoly power to hurt them. I don't think there's any one company that has caused us to look into this.
What is the exact nature of these complaints, and how will you focus your inquiry during the hearing?
We plan to detail all of this at the hearing, and not before. Our committee has been investigating some of these complaints for weeks, and we plan to issue a report on our findings, probably the morning of the hearing, on March 3.
You just said the Judiciary Committee is late looking into these allegations against Microsoft. Why is that?
It's something that deserves being looked into. The question is, has there been any violation of the antitrust laws? Some say yes. Microsoft says no. Netscape is concerned about it, and Sun Microsystems is concerned about it, but they're competitors, and you have to look at both sides. We've had complaints for a long time, rightly or wrongly, and I have to say that we didn't jump right on them.
But why is that? There's been intense interest among those in the high-tech industry in the antitrust investigation of Microsoft. But Republican Sen. Slade Gorton, Washington state's senior senator and a defender of Microsoft, said your Judiciary Committee hearing next week isn't even on the radar screens of most of the nation's senators. Is that true -- is that why it hasn't been a higher priority for you?
Partly. I think part of the problem is that antitrust law is difficult to understand. It takes a lot of work to fully understand it, and the senators are relying on us on the Judiciary Committee to do proper oversight. That's what we're here for. It's become clear that if we didn't look into this, perhaps no other Senate committee would have. So we're having this hearing.
