Restrictive Microsoft Contract Raises Eyebrows

A year ago, when Microsoft was busy snatching key customers away from rival Netscape Communications, officials in Redmond emphasized that the deals they were striking weren’t cutting out the competition.

Instead, they characterized the agreements in much more benign terms, saying their World Wide Web browser was being chosen merely as the “preferred” product over Netscape’s.

But a copy of a contract that surfaced Tuesday shows that Microsoft required one Internet service provider not only to promote the Microsoft browser but to agree it wouldn’t tell some customers that an alternate browser was available.

The contract, between Microsoft and EarthLink Network, a national Internet service provider based in Pasadena, Calif., surfaced during a Senate Judiciary Committee hearing, which addressed competition in the computer industry but focused largely on investigations into Microsoft’s business practices. Committee Chairman Orrin Hatch, R-Utah, produced the contract near the end of the daylong hearing.

Microsoft spokesman Mark Murray stressed that the clause prohibiting EarthLink from telling customers about Netscape applied only to customers who were referred to EarthLink through the list of Internet service providers created in Windows.

Murray called the EarthLink deal a “simple cross-promotion agreement.”