Be Files Suit Against Microsoft for Destroying Business

Becoming the latest in a series of antitrust claims against the software giant, Be Incorporated today filed suit against Microsoft for "the destruction of Be's business resulting from the anticompetitive business practices of Microsoft." Be had said it was considering such action last August upon selling its technology assets to Palm, Inc. for mere pennies on the dollar. The lawsuit alleges that Microsoft used "illegal exclusionary" tactics to prohibit PC manufacturers from shipping computers with multiple preinstalled operating systems.

BeOS -- Be's multi-media desktop operating system -- had a devoted following, but weak sales and hardware support kept it out of the mainstream. Be planned on shipping BeOS with Hitachi PCs in late 1998, but the deal was canned when Hitachi realized its licensing with Microsoft restricted such dealings. Be struggled to gain market share, and at one point even offered a free "personal" version of BeOS over the Web before running out of cash.

"Microsoft exercised its monopoly power to exclude BeOS from
the market, and forced Be to cease doing business. Sensing that BeOS posed a significant threat to its illegal monopoly, Microsoft smothered Be by using its dominant market position to prevent
computer manufacturers from installing Be's technically superior operating system," the lawsuit states.

Microsoft fired back Tuesday with its standard innovation rhetoric. "This sort of litigation is not in the interest of consumers, nor is it good for the industry," said company spokesperson Jim Desler. "The industry is at its best when it's developing new products and focusing on innovation."

A copy of the complaint filed against Microsoft is available on Be's Web site.