U.S. Judge Says Microsoft Violated Antitrust Laws With Predatory Behavior nytimes.com
The NYT has a ton of stuff today, as you might expect. This is the lead story, from which I will pick out a few good bits for old time's sake.
A central conclusion in the government's case -- and in the judge's findings of fact -- was that Microsoft tied its Web browser to the Windows operating system to gain market share for its browser and put Netscape at a disadvantage.
But a finding of fact does not necessarily lead to a similar conclusion of law, which says that the action violates antitrust laws. That is particularly so in this case because a three-judge panel of the Court of Appeals, overturning an order by Judge Jackson requiring Microsoft to offer a version of Windows without the browser, decided 2 to 1 in 1998 that Microsoft had every right to tie the browser to the operating system, if the company could demonstrate a plausible consumer benefit.
The Court of Appeals judges also suggested, however, that their opinion might change once they saw the evidence record from a trial. Judge Jackson devoted the largest section of his ruling to defending his judgment of liability on this count.
The Court of Appeals opinion, he wrote, "appears to immunize any product design (or at least software product design) from antitrust scrutiny, irrespective of its effect upon competition, if the software developer can postulate any 'plausible claim' of advantage to its arrangement of code."
He cited several Supreme Court decisions that support his view and called them "indisputably controlling." He concluded: "Microsoft's decision to tie Internet Explorer to Windows cannot truly be explained as an attempt to benefit consumers and improve the efficiency of the software market generally, but rather as part of a larger campaign to quash innovation that threatened its monopoly position."
Oops, getting a little wordy. Just in passing, though, I'll note that Bill allegedly offered to deliver an IE-less Windows as a settlement offer. A bit late in the game, of course. Anyway, the most interesting bit, I think:
Some experts said the ruling made it likely that the government would ask for a remedy that would break up the company.
"It boxes them in," said Robert Litan, a former senior official in the Justice Department's antitrust division who dealt with the department's last suit against Microsoft, in 1994.
In the mediation effort that ended on Saturday, "Microsoft already made it clear that they would not accept a conduct remedy" acceptable to the government, he said. And this suggests that, if one were imposed, the government might face difficult enforcement questions.
"With this strong validation of the case, we now know that only a breakup will address the operating system monopoly" that is at the heart of the case, Mr. Litan said. He is now with the Brookings Institution and has said he favors breaking up the company into several autonomous parts.
Me, I don't know, I've always professed agnosticism on the remedies issue. Can of worms, that.
Cheers, Dan. |
