Probe of Microsoft On-Line Plans Expanded

The U.S. Justice Department has turned up the heat on its investigation of Microsoft Corp.’s new on-line information service, industry sources said Thursday.

The agency is investigating whether Microsoft’s plan to include software for the Microsoft Network in the new version of its Windows software is a violation of antitrust laws. This week, the department issued a new round of civil subpoenas to companies that have agreed to provide programming for on-line services.

Earlier this month, the Justice Department sent out civil subpoenas to the leading on-line service providers, including CompuServe, America Online and Prodigy, and all three say they have supplied the requested documents.

Competitors have complained that Microsoft’s plan to include the network software in its upcoming Windows 95 software is unfair, and analysts said the Justice Department now appears to be taking those complaints seriously.

Microsoft expects to sell 35 million copies of Windows 95 the first year it’s on the market. If only a fraction of those users try the network, Microsoft will be an instant giant in an industry that currently boasts about 7 million subscribers.

The Justice Department may thus seek an injunction forcing Microsoft to separate the network from Windows 95.

The expanded investigation comes as some content providers of the Microsoft Network have complained that the on-line service gives Microsoft an unfair advantage in building customer lists for its own applications software.

Competing software companies that sell their wares on-line complain that Microsoft plans to deny them access to the Microsoft Network’s customer list--an important marketing tool that could help companies when sending out promotional material.

Bill Miller, vice president for marketing at Microsoft Network, denied the company would have an unfair advantage over on-line companies or content providers.