>The total worth of a broken Microsoft will be "0".<
(since we have gotten onto the effects of breaking Microsoft up).
This is somewhat of an exaggeration (What, on S.I.??!, I'm shocked, shocked!), but it really proves the point of why Microsoft should be broken up. Vertically, not horizontally.
Microsoft has traditionally used its control of the O/S to enhance the application part of its business. For a long time: "DOS isn't done until Lotus doesn't run." B. Gates later claiming that they never said that there was a "Chinese Wall between the O/S and applications division, despite M. Maples saying it years earlier.
Creating an O/S company, an applications company, and an internet and consumer products company (you can argue how the applications would be divided up) would take away the financial incentive for the O/S company to favor applications from the other Microsoft company over that of another applications company, such as Lotus, Netscape, Corel, etc. The O/S company would be able to cut any deal it wants with whomever, but its responsibility will be to its own shareholders. Thus, it can include a browser (or any software), but at whatever cost it incurs to get it.
The courts clearly can't get into the business of overseeing what goes into the O/S, since what we expect in an O/S changes. The best example is networking software. It used to be separate, when most buyers of the O/S didn't need it. Then, it became what most people expected and got included. That is true of other O/S's, too, such as the Apple operating system and OS/2. But, if the incentive to bundle I.E. or Office was removed from the O/S company, Netscape and the Microsoft applications company would be able to cut their own deals with the O/S company or with the sellers, such as Dell or Compaq, without there being a financial incentive to chose I.E. over other browsers, or Office over other suites.
Finally, where the courts should look into antitrust is the deals cut with the companies for the price per copy of W98. The old way of charging per computer sold was eliminated (rightfully so) in the first antitrust case. Now volume discounts are on the percentage of computers shipped with W98, not on the number of copies purchased. Volume discounts are fine; a cheaper price/copy per million copies purchased happens all the time in business. But, to charge a lower price per copy if a company sell 100% of your machines with W98 than if you sell 50% of your machines with W98 is anticompetitive. This assumes that company 2 sells twice as many total computers as company 1, giving both the same number of copies of W98 purchased. with W98 is anti-competitive. |
