Actually, the theory of the case seems to be that Microsoft pressured Intel into desisting from introducing new technology which would have made Windows run audio and video better. The problem is that this new software by Intel would have invaded Windows' "turf," which of course is a Bozo no-no.
Mr. McGeady said consumers were harmed because Intel wanted to make the personal computer "sing and dance" with richer video and audio technology. Part of Intel's development efforts would have addressed a shortcoming of Windows, he said, by processing video and sound continuously, without "the Max Headroom effect, with jerky video," that comes when the PC's chip is interrupted every few seconds to do other tasks, as in Windows.
The software, called NSP, or native signal processing, would "sit underneath Windows and allow audio and video to play uninterrupted," Mr. McGeady said. But he said every time Intel did anything that overlapped with Windows, "they had a conniption."
Well, of course they did, but how does one distinguish a "conniption" that is predatory from one that is competitive, since both are manifestations of them having fits over the possible entry of potential competitor Intel into the (contestable?) software market?
Microsoft's counter is that Intel's real motivation was to sell its more expensive chips and that consumers would not have been better off:
In a likely foreshadowing of the software maker's cross-examination of Mr. McGeady later this week, Microsoft's Carl Stork, who manages the relationship with Intel, said Monday that the NSP technology "was not about consumer benefit but instead was in Intel's commercial interests to get people to buy the next-generation microprocessor."
Microsoft also contends as a factual matter that they were only concerned about incompatibility issues between Windows and the underlying chip (echos of the incompatibility issues between DOS and Windows that we have heard so much about???). All you appellate opinion readers out there should recognize where that one is going. ;)
These choice cuts points up what, in my view, is one of the fundamental issues in the case: whether innovation is per se better for consumers.
This whole episode also points up the fundamental issue of how one goes about identifying predatory, as distinguished from competitive, behavior, in high-technology markets, and whether the benefits of doing so outweigh the costs, not just to the courts but to the economy as a whole (or, for that matter, whether it is even possible as a factual matter to engage in such cost-benefit analysis when deciding whether to engage in economic intervention such as antitrust).
interactive.wsj.com
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