Why Microsoft Crashed

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When I was covering the Microsoft antitrust trial, the company invited me to have breakfast with its legal team. We covered all the basics: whether Microsoft was a monopoly, whether its actions had caused "consumer harm." But what stuck with me was a remark by a high-level Microsoft executive. He had heard I once worked for a federal judge he knew. The more I tried to focus on the antitrust issues, the more I kept wondering how this man I'd never met summoned up this nugget from my past.

That little mystery is solved in Ken Auletta's absorbing new book, World War 3.0: Microsoft and its Enemies (Random House; 436 pages; $27.95). Microsoft kept dossiers on reporters who covered the trial, including former jobs, friends and perceived biases. All things considered, it probably wasn't a great idea. In the middle of a lawsuit accusing Microsoft of being controlling and intimidating, it just made the company look, well, controlling and intimidating.

The challenge for any analysis of the Microsoft antitrust saga is to resolve its central enigma: How could the same people who'd been so brilliant in the lab and the boardroom--building the world's most valuable corporation in a mere generation--have been so wrongheaded in the courtroom? Auletta has a provocative answer: what the Jesuits call holy effrontery. He argues that Bill Gates and his disciples are so convinced of the rightness of their cause that they can't even conceive that they might be wrong--or that any fairminded person could think so. And it's a basic tenet of holy effrontery that in defending their cause the righteous can use any means.

Auletta comes by his insights the old-fashioned way: he wore out a lot of shoe leather. He had significant access to all the key players in the story. His interviews with Judge Thomas Penfield Jackson, the federal district court judge who heard the case, yield a motherlode of provocative, if sometimes injudicious, reflections. Recalling, for example, a photo he came across of Gates from the early days of Microsoft, Jackson told Auletta that what he saw was "a smart-mouthed young kid" who "need[ed] a little discipline."

World War 3.0 also provides fresh insights into the failed effort to reach a settlement before Judge Jackson ruled. Justice and Microsoft were moving toward compromise. But, Auletta reports, the state attorneys general--who had to sign off on the deal--took a harder line than Justice on what the remedy should be, causing the mediator, Judge Richard Posner, to throw up his hands. The book's main flaw is one of pacing: there's too much detail on the trial and too little on Judge Jackson's order to divide up Microsoft.

If World War 3.0 is the diligent analysis of the case, John Heilemann's Pride Before the Fall: The Trials of Bill Gates and the End of the Microsoft Era (HarperCollins; 246 pages; $25) is the dramatically arced screenplay. Heilemann's book, which started life as an article in Wired, is a fast-paced account full of big-screen moments. The most impressive: his contention that the richest man in the world exclaimed at a Microsoft board meeting last year that "the whole thing is crashing in on me" and started to cry.

Heilemann also pounded his share of pavement. The payoff is a compelling account of what he calls the "secret history" of the trial, including the clandestine maneuvering of Sun Microsystems, Netscape and other Microsoft enemies, to persuade the Justice Department to bring a lawsuit it didn't want to pursue. In the end, Heilemann draws on the Bible--as his title suggests--rather than Jesuitism to reach much the same conclusion as Auletta's: Gates' arrogance led him to run Microsoft, and the trial, like an "aspiring god."

Of course, World War 3.0 still rages. Judge Jackson's sweeping ruling is now on appeal. And President-elect Bush has not yet revealed how committed he is to this Clinton-era case. At this point, only one thing is certain: both authors will have a lot of revisions to do before the paperbacks come out.