I’m not very knowledgable at all about the whole MicroSoft monopoly thing, however I do remember a court case (wasn’t interested at the time- only remember vague details) and have seen a couple of Pit threads mentioning it lately.
Can someone fight my ignorance and explain the whole thing for me ?
All I have gathered is that MicroSoft is on its way to a monopoly and has too large a market share. I can’t believe that this is the problem in a country that I thought encouraged capitalism and a free market, so I would like an overview and more details.
I may be completely off base here, but please explain it to me. I have no agenda, so please don’t abuse me. I am requesting that my fellow Dopers educate me on this topic of which I know almost nothing.
Thanks in advance for some (hopefully) well-thought responses
Your question is way too big to answer in detail in a forum like this, but the gist is this:
Microsoft is not “on their way to becoming” a monopoly. The courts have ruled that Microsoft is a monopoly. There is, however, nothing legally wrong with being a monopoly.
Being a monopoly is not Microsoft’s problem - how they’ve used their monopoly power to bully vendors, hurt competitors, and (IMHO) harm consumers is.
When you are the really, really big kid on the block, U.S. antitrust law says you have to play extra nice with the other kids. Microsoft has never believed that. Unfortunately, they keep getting away with their misbehavior.
Thanks, Barney111. That explains it a little bit. Can I ask why a court had to determine that Microsoft was a monopoly ? I don’t get that.
Also any specific incidents where they have hurt competitors, harmed customers and bullied vendors. Just a quick description of said incident, or a link, would be extra helpful. Thanks all.
Here’s a real-life scenario that Microsoft has been accused of that illustrates all three:
You are a PC vendor. You build and sell personal computers (read Windows boxes), so you need Windows. Up until now, you have been pre-installing Netscape on your computers so your customers will have a web browser - because Microsoft hasn’t invented Internet Explorer yet.
One day Microsoft comes to you and says “We feel really threatened by Netscape and this whole web business, so we’ve invented Internet Explorer,and bundled it with Windows free of charge. From this point on, you will put the Internet Explorer icon on the desktop and quit pre-installing Netscape. If you refuse to do this, we will no longer sell you Windows.”
You are now a bullied vendor- you can’t do business without having Windows on your machines. You are forced to go along.
Netscape is the hurt competitor. The “great unwashed” will simply use Internet Explorer because it is already on the desktop. Many users won’t even know that Netscape exists. Microsoft, with your (albeit coerced) assistance, has used its monopoly power to create a very unlevel playing field.
Many consumers are harmed because Netscape cannot compete fairly for their business, and they are forced to use a clunky and unsafe browser known as Internet Explorer.
Because under antitrust law, conduct that might otherwise be permissible is illegal if you’re a monopoly. To use Barney111’s example, if Microsoft didn’t hold a monopoly (e.g., there were many competing OS vendors) and used the same tactic, there’d be nothing wrong with it. You must first prove that the accused is a monopoly before you can prove it abused its monopoly power.
If I can get on my soapbox for a second, this is one of the real problems with antitrust law in general. Conduct that would otherwise be permissible – or even praiseworthy – suddenly becomes illegal after you have a certain market share. And just what those activities are is ill-defined --it basically encompasses anything a competitor can convince a judge constitutes “abuse of monopoly power.” Thus, an extraodinarly successful company has precious little in the way of notice so it can correct its conduct before the lawsuits start.
I’m now more confused than ever, I think. While I understand now why a court declared Microsoft a monopoly, I am fervently grateful I probably will never have anything to do with American anti-trust laws.
It seems to me, that as long as your competitors are woefully unsuccessful, you are in danger of being in trouble for being a company whose interests lie in making profits.
Crap. Why the hell did I take that antitrust class this summer, if y’all are going to streak in here and answer the questions before I get a chance to?
There’s also the “processor issue.” Micro$oft, early in its career, made OEM PC vendors sign a contract which states that no matter what operating system you sell a PC with, you have pay Micro$oft a royalty fee for that system, just like you would if it had a Micro$oft OS on it. Which means, that a vendor is going to ship a M$ OS on every system. In fact, if you call up some vendors and say you want to order a PC with Linux pre-installed, they’re going to tell you to take a hike. (IBM, I think, is the only exception to that.) If you do manage to get them to ship you a machine with Linux on it, you’re going to pay more for it, because they’re not only going to charge you for the Linux OS (Okay, okay, they’ll charge you a “nominal fee” for the disks and the manuals, it’ll still work out to be at least 20.), but they'll also charge you for Windows XP or whatever OS M happens to be promoting at the time. Nevermind that you’re not going to use it on your system, you’ve still got to pay for it, because your vendor had to pay for it. How M$ got away with this, I don’t know. Its sort of like Mercedes (who invented the first gas powered car) getting paid for every car sold by anyone out there. Even if that car doesn’t have a gas engine!
