Microsoft Case
As far as I've seen, this entire ordeal is over
a FREE browser that Microsoft
includes with windows for FREE and gives out on
the internet for FREE just as
Netscape and most other browser companies
do. I have yet to see where Microsoft
is charging extraordinary prices for
any of these FREE programs nor do I see how
Netscape, in using the
governments definition, a "monopoly" itself, is
"being forced out of
business" by Microsoft’s FREE browser.
Remember: the charge is against
including Internet Explorer with Windows, not
the Windows monopoly itself.
What this entire case boils down to is that a few
Washington liberals are
upset at Microsoft for daring to be successful. These
are the kind of people
that hate wealth, capitalism, and anything that is more
successful than them.
My intention is to show that the case against Microsoft as
a monopoly is weak
and that the government is wasting its time. As the
government jumps to the
defense of the "all-too-often" taken advantage of
consumer, they have
accomplished very little. They tried to prevent the release
of Windows 98 (a
much anticipated and highly demanded program that was and is
available at
reasonable prices) but didn’t even phase the consumers second
thoughts. The
government is costing taxpayers millions of dollars to pursue this
suit
against Microsoft. Microsoft’s operating system near monopoly is
probably
good for us. It is much better to have one operating system than 20
or even 2.
Software compatibility, technical support, and setup are much
more simplified
with one operating system. Programs today are specifically
designed to be
"Windows compatible." Would you rather have 20 (local)
phone
companies, each with a different line and number running into your
house or one,
as is the case now? Also, Internet Explorer brings browser
competition to a
market that is essentially monopolistic itself (at least if
you apply Janet
Reno's definitions of monopoly). Internet Explorer gives
Netscape a competitive
product where before virtually none existed. The
purpose of antitrust laws is to
prevent only harmful monopoly. Microsoft’s
operating system near monopoly is
harmful in very few ways. Nor is Intel's
chip near monopoly harmful, nor is
Netscape’s browser near monopoly.
Other reasons easily explain how Microsoft
came about to its size and how new
companies constantly spring up in the
computer industry. Computer software is
a very volatile industry. To succeed in
this industry all you basically need
is a good program and a way to offer it for
sale. When Microsoft, or any
other software company, makes a program they only
have to write it once. When
this is done, reproduction of this program is very
simple. All they have to
do is copy it on a disk. Since making an extra disk
containing the program
costs all of 2 cents, it is more costly for the software
company to print the
box and manuals than it is to make one extra disk. With
this situation
occurring, a good program, once written, can be produced marketed
at
virtually no additional cost. Well you say, "if disks only cost 2 cents,
why
can't windows sell for 2 cents?" Remember that it costs Microsoft to
develop
a new program. No matter how cheap a disk is, other costs such as
salaries,
factories, storage, and programmers always exist. Even though
development
costs are sunk and additional production costs are nonexistent,
other costs
are incurred. Besides, supply and demand determines where a price
will fall.
Another thing about the computer market is its ever-changing program
market.
As I said earlier, anyone with a good program can be successful in
the
computer industry. Programs come about all the time. For example, the
most
popular finance program is Quicken. Microsoft’s version, Money, is
included
with many of its programs yet Microsoft, the multibillion dollar a
year company,
has considerably less users than Quicken, with mere tenths and
hundredths in
sales than the annual income of Microsoft. Another example is
Accessories Paint
compared to Print shop or EXPLORER compared to NAVIGATOR.
Microsoft offers its
own products as complements to Windows, often for FREE,
but consumers still
prefer others. For all we know, anyone literate in
programming may develop a
better program than Windows. If consumers like it,
we may soon find another
browser monopolist. For reasons similar to this,
computer industry leaders have
vastly changed in just a few years. At times
Apple, IBM, Intel, Netscape,
AT&T and even Commodore, have or had
large, sometimes monopolist-like
markets. Characteristics of monopolies that
cause trouble are (1) restriction of
output, (2) higher prices along with
this restriction, (3) restriction of entry
to a particular market and, in a
few cases, (4) lack of innovation due to lack
of competition. Not a single
one of these problems is experience with Microsoft.
These problems are
only drastic when an item is in a secluded market with no
close substitutes.
Computers are definitely not necessities and there are few
barriers to entry
in the computer market (the only noticeable being computer
literacy).
Microsoft certainly does not restrict output and hold prices at
extreme
levels. If they did, nobody would buy Windows 95 or 98 when it came
out.
There is no reason to buy an upgrade except that people are looking
for
something new or something bigger and better. New versions of Windows do
not
sell because consumers aren’t forced to buy them. They sell because
consumers
want them. Many of Microsoft’s major products are included with
Windows.
Giving products away at no monetary cost is certainly not
restricting output.
Even more, it is the lowest price the company can
sell at. The only cost of
getting Internet Explorer, or Netscape Navigator
for that matter, is a tied up
modem for about 45 minutes. This is even
avoided when Explorer or Navigator are
included free with another piece of
software such as Windows or, in Netscape’s
case, the software you get when
you sign up with an online service. Netscape had
an almost full monopoly
(90%) and still has a semi-monopoly at 65-70% of the
browser market. So what
they are worried about? They use the same methods of
distribution of their
software by offering it for free and having Internet
providers include it
with their registration software. Before Internet Explorer
came along, we sat
for long periods waiting for browser upgrades. There was
essentially one
browser - Netscape two point something. Upgrades have been
almost constant
since the introduction of Explorer. The result: two companies
with advanced
browsers competing to build a better browser. Microsoft is not the
only
operating system to choose from. While very practical and well suited for
the
current computer industry, Windows is not alone. Many other
operating
systems, some even FREE, are available. There are around nine in
the US alone:
Linux, Caldera, Solaris by Sun, BSDI, Unix for the PC by
Digital, BeOS by Be,
Rhapsody by Apple, OS/2 by IBM, and the Macintosh
OS. Globally there are bigger
companies that have more of the global market.
So how is Microsoft a monopoly if
there are nine other substitutes in the US
alone? Once again though we are not
really talking about the operating system
market but I just had to make a big
point. Finally and most importantly, what
right is it of the government to tell
Microsoft how it can and cannot
configure its own software? Once Windows is
installed, consumers have the
option of disabling as much of Windows as they
like. If you don't like
Explorer, disable it and get Netscape (for FREE). We
don't need Janet Reno to
decide this for us. Just remember that Microsoft is a
free company- able to
write its own programs the way it wants to just as you can
do if you so
desire! Don't let Washington liberals fool you with their charges
when
Microsoft shows hardly any characteristics that make a monopoly
dangerous.
We are facing a great abuse of the government’s anti-trust
laws for their only
purpose is to stop dangerous (and ONLY dangerous)
monopoly. Washington should
not be able to get in the way of a successful
company over Microsoft’s right
to include their FREE software with their own
program.