Keith, If they make CE the de facto standard in palm tops and the palm OS of 3COM fades and 3Com must buy CE from MSFT, you have a classic exclusionay monopoly. MSFT can price the CE at the point where 3Com makes a loss on each palm pilot they sell and MSFT makes a profit, since they get a CE fee from 3Com, and pay no fee to themselves to use their own CE.
As two companies the microsoft palm clone company would have to buy CE from MSFT, just like 3Com, and the differential advantage would vanish.
How would you like all the streets and sidewalks to be toll roads, owned by your next door neighbour. Everytime you go to work you pay him for crossing the sidewalk, going down the road etc. And if you both work at the same place for the same wages, he can control you completely financially. If he refuses to lett you use his rights of way, you stay home and starve, a high price and you exists but do not flourish.
A simplistic concept?, not far off if you make palmtops that compete with MSFT. What if MSFT asks $100 for each CE. If CE becomes the defacto standard should all other palmtops close down and we all buy our palmtops from MSFT?. How would the pace of change vary?. it would stop, as this old style type ofsoviet monopoly permeates.
At this time MSFT does not sell computers. If they upped their Win95B price to $500 and went into making computers, what would happen?
Bill |
