Mr. Marti,
To break Microsoft , it must be under the following two reasons, i.e
" Increase the competition" & " Benefit the consumers"
other than that, such as the company is large so need to be broken up ...etc are
all rediculous.
Will the break up of Microsoft really benefit the consumers ? and increase competition ?
I do not think so. The reason Microsoft is valuable is because it has all kinds of
ingredient to make a delicious dish, make the product much better than the competitors and with much lower price, this is why Microsoft has a huge market share in its product lines and benefit the consumers. If Microsoft lost that ingredient,
Microsoft is not Microsoft anymore , and its value degrade immediately.
Did Microsoft have competitions in the market ? Yes, it did, and the comptition is very fierce. Look at What SUN is doing with its solaries OS? Giving away its OS free
and compensate its revenue loss of OS by promoting its sales of hardware. Look at what SUN is doing with its Java ? Look at Linux, ell is to sell its hardware with Linux, Same to CPQ, Intel is investing heavily in Red Hat . All these are serious threat to Microsoft down the road. So, Microsoft has competion , and the threat is very real, and the whole picture can be changed .
So, breaking up Microsoft will not benefit the consumer, because Microsoft will
lose it ability to developed a well integrated product with lower price . As a result of
breaking up Microsoft, only its competitors will benefit, because companies like
SUNW and IBM , ORCL will be stronger than the broken MicrosoftS , and will be in a much better position to compete or destroy the baby Microsofts, because these
giant competitors were not breaken up equally. What if Sunw had OS, Java, Database
Softwares, while the new baby Microsofts did not have all of them ? So , the break up of Microsoft will not promote competition , it only helps the current competitors of Microsoft to destroy the baby Microsofts. The Break up of Bells is quite different, because AT&T is the only telephone companies in the market at that time, and AT&T had a absolute monopoly , and "0" competition. By breaking the Parent Bell into several small Bells, the baby bells compete by themselves, and it really benefit the consumers with better service.
The next question is how Microsoft should be broken up ?
Horizontally or Vertically ?
Microsoft is a fully integrated company, it has every thing to develop a better product. If Microsoft is broken up vertically, i.e Each Baby Microsoft own certain
products of the old Microsoft , and there is no product overlap among all the new Microsofts, this will not result a competition among the new Microsofts, but weak the
power of each new Microsoft to compete with Microsoft's current competitors , companies like Orcl, Sunw, IBM , Red Hat ...etc, and each New Microsoft lost the power to develop a better integrated product to benefit the consumer, and the price of software will be much higher than today, Because from then on the consumer
will need to buy OS from Microsoft(A), buy Excel/Words from Microsoft (B) ,
buy IE from Microsoft (C), and each of these product will be more expensive
by selling seprately than integrated together as one single package from the old Microsoft. Because you have more layers now (middle man) , and each layer need
to take a bite of the profit. And the quality of the product will be degraded, because you have each of these product developed seprately by several companies, and you will
have a compatability and quality issue. So, vertical break up of Microsoft will not
benefit consumers and won't promotr competition either, it just help the Current
Microsoft competitors to destroy the baby Microsofts one by one later.
So, what about break up Microsoft horizontally ?
That is , each Baby Microsoft is just a completely copied one of the old Microsoft but with smaller size , and all Baby Microsofts will compete with each other ?
This will cause an immediate problem for each of the new Microsoft, because each
new Microsofts will need the same man power to continue the development of each of the product lines inherit from the old Microsoft, and the baby Microsoft will not have that kind of resource as the old Microsoft, and as a result, it will delay the product development , and which will also hurt the consumers.
As I said before, the value of Microsoft of today is because it is Microsoft, and once it is broken up , it is not Microsoft anymore, and the Value is "0" .
So, you now own a Benze Mercede S600, and its market value is around $130K.
Once you break it up, and sell it as Auto parts, What kind of money do you think you can get out of it ? The value of Benze Merce S600 is built in the whole integrated car, which can function as a car. Once it is broken up, the value is very marginal.
Sorry, see lots of typing errors, do your own guess. I have no time to fix them one by one.
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