Novell slaps antitrust suit on Microsoft over WordPerfect

By Steve Malone

Posted on 15 Nov 2004 at 09:54

As Novell promised when it picked up the $536 million from Microsoft last week, the company has filed an antitrust lawsuit against Microsoft. Novell alleges that Microsoft used its domination of the operating system market to destroy the market share of its word processing application WordPefect and spreadsheet Quattro Pro.

Novell says that Microsoft withheld key technical data about Windows which prevented its developers from building products which could compete with Word and Excel.

At the time, Microsoft always maintained that there was a 'chinese wall' between the operating systems developers and the application developers that prevented undocumented features passing from one to the other to give Microsoft applications the edge in the market.

Novell is not only claiming that this was not the case but goes further by claiming that Microsoft actually added code into Windows which would damage WordPefect and other applications from relevant markets.

This harks back to a claim made in the 1980s over an MS-DOS compatible operating system DR-DOS. Originally developed by Digital Research, the OS was bought and developed further by Novell. However, the company later maintained that Microsoft tweaked MS-DOS so that the rival DR-DOS was incompatible with certain key applications.

The effect of these alleged practices by Microsoft was catastrophic on the companies' productivity applications. Novell says that in 1994 acquired the WordPerfect word processing program when Novell and
the combined value of WordPerfect and Quattro Pro at the time was over $1 billion. Two years later when Novell threw in the towel WordPerfect and Quattro Pro were sold to Corel Corporation for approximately $170 million.

Novell says that WordPerfect's share of the word processing market was almost 50 percent in 1990, but fell to less than 10 percent by 1996. By the same token Microsoft Word's market share rose from around 20 percent prior to 1990 to a whopping 90 percent by 1996.

Whilst the raw figures chart the relative decline of WordPerfect, the software was already in trouble as the WordPerfect Corporation had backed the wrong horse in the operating system stakes, producing a version for the doomed OS/2 and then being late with a Windows version. By which time, Word had already established itself on Windows desktops

Nevertheless, the Provo, Utah based company says its case is based on facts which emerged during the anti-trust case brought by the US Government in its antitrust case against Microsoft.

Joseph LaSala, Novell's senior vice president and general counsel said `We intend to pursue aggressively a goal of recovering fair value for the harm caused to Novell's business by Microsoft's anticompetitive actions.`

Microsoft is being very robust in refuting the suit. In a statement the company says `Novell seeks to blame Microsoft for its own mismanagement and poor business decisions. The record is clear that bad decisions and business mistakes are the reasons WordPerfect fell out of favour with consumers. It's also unfortunate, and surprising, that Novell has just now chosen to litigate over a business it owned for a very short time and that it sold more than eight years ago.`