Gates: MS Didn't Pressure Intel

Gates says in a videotaped deposition that Microsoft never pressured Intel to get out of software. Microsoft, however, did tell Intel that its software was pretty bad.

WASHINGTON -- Microsoft chairman Bill Gates testified in a taped deposition played in court Monday that it was never his intention to keep Intel out of the software business.

Government lawyers played the Gates tape prior to testimony by Steven McGeady, Intel's vice president, concerning the chipmaker's foray into the software business. McGeady is the fourth of at least 24 witnesses expected to testify at the trial, which entered its fourth week Monday.

The Justice Department and 20 states have alleged that Microsoft (MSFT) violated the nation's antitrust laws by competing unfairly against Netscape Communications (NSCP) in the market for Internet browsers.

McGeady is one of a number of witnesses the government has called to demonstrate Microsoft's attitude toward Netscape, and the way it goes about protecting its software business.

Microsoft and Intel (INTC) work so closely together that their machines are sometimes called Wintel products. Intel's chips serve as the brains of most personal computers, while Microsoft's operating systems run on nearly all of those machines.

McGeady worked with a unit of Intel that developed software to run on his company's chips.

Government lawyer David Boies asked Gates in a deposition given in August to comment about what actions his company might have taken once it learned that Intel was making software.

"Did you or others, to your knowledge, from Microsoft tell Intel that if Intel began to compete with Microsoft, Microsoft would be forced to begin to compete with Intel?" Boies asked Gates in the taped deposition.

"No," replied Gates.

"Was it part of what you wanted to accomplish, Mr. Gates, to keep Intel and Microsoft in separate businesses?" asked Boies a few minutes later.