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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Captain Jack who wrote (43124)	4/24/2000 10:27:00 AM
From: Sam Citron	Read Replies (2) \| Respond to of 74651

>what can possibly be in Gates and Ballmers head? Spreading FUD about competitive software market: Ballmer argues MSFT break-up can't boost shareholder value: "I was an economics major," Ballmer said. "I learned enough of economics to know that If you have two guys selling the same thing and the marginal cost is zero, the price point on that is a well-known economic fact. And yet you have people say that it will increase shareholder value. I would vehemently dispute any notion there would be enhanced shareholder value on breakup." washingtonpost.com Is Ballmer saying that MSFT can not thrive in a competitive environment to the extent that it has as a monopoly? If so, how would he explain the fact that AT&T (including its many RBOC holdings and Lucent) greatly enhanced shareholder value after its break-up? Ballmer forgets or ignores the fact that erstwhile monopolies tend to become more efficient and responsive to external market dynamics when they have to compete and this dynamic inevitably enhances shareholder value. Not that firms enjoy having to compete, if given a choice. It forces them to work harder. Which is why I assume Ballmer made this statement to Washington Post editors.