Microsoft Versus the Department of Justice

(Part 2)

 

In 1995 U.S. Attorney General Janet Reno asked a U.S. District Court in Washington, DC, to place a $1,000,000 dollar a day toll until Microsoft agrees to stop demanding that PC makers license Internet Explorer when they license Windows 95. Reno announced the Department of Justice’s antitrust action, and she cited a 1995 consent decree according to which Microsoft agreed not to engage in this type of licensing practices.

Microsoft then announced that its web browser would be fully integrated into the next version of its operating systems product line, which was released in 1998. This scheme for constricting consumer choice was to establish Internet Explorer as the “default browser” on all new copies of Windows. A competing web browser can be purchased, installed and selected by the user as a substitute “default browser,” but this exercise in personal preference requires additional expense and a lot of extra trouble. In any other industry, selling products at a loss for the purpose of driving another company out of business would be instantly disallowed as “dumping.” Microsoft was amazingly candid about the consumer-defeating designs of its Internet Explorer scheme. Steve Ballmer, Microsoft’s vice president of sales said, “We’re giving away a pretty good browser as part of the operating system. How long can they survive selling it?”

Throwing in an additional barrier between the customer and their personal preferences, Microsoft also disclosed that a non-Microsoft browser will be affected in such a way that it will function relatively inconveniently. According to this new scheme, in every instance where the computer operator clicks on a built-in system “shortcut” to visit a website, Windows will automatically send them there via Internet Explorer, no matter what choice the user has selected for the default browser settings.

There is not a company that is able to withstand these types of attacks by Microsoft. They are aware of that fact and use tactics to stifle competition probably more often than we are aware. Lacking any serious competition Microsoft will have no incentive to produce effective applications, with new and innovative features in a punctual fashion. Quality control would be non-existant and customer service will be as well. Unsatisfied consumers will have no recourse for action.

It was also known that Microsoft would keep competition out of the arena by buying a new product and simply never introducing it. An inventor would show the new product to Microsoft and they would show interest and purchase the product. At times they would even introduce the product but it would never be sold. They would simply discard it to keep it out of the marketplace. Who knows what kind of products Microsoft has kept from the consumer?

Another tactic would be to make a programmer sign a contract with Microsoft. In the contract they would include that they could not guarantee that they would not steal the product and market it as their own. So the programmer did not have a say if they were included as the developer or not, or even worse not get paid for their invention.

With no intervention from the Department of justice, Microsoft would continue unimpeded in its quest for entire market domination. Microsoft’s misdirection campaign, monopolies go against the cause of free market capitalism. To put restraints on Microsoft the Department of Justice would need to prove that consumers would benefit by constricting Microsoft.

 

Microsoft Versus the Department of Justice