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To: Eric Wells who wrote (102080)	4/25/2000 4:10:00 AM
From: GST	Read Replies (1) \| Respond to of 164684

Eric <. Do you feel that Microsoft products are somehow inferior because they had predecessors engineered by other companies?.> MSFT has not distinguished itself with breakthrough technology or with product quality. Derivative products are the norm for marketing companies so this is hardly news -- but it is not the norm for companies which try to claim exemptions from the anti-trust law, as MSFT wants to do, by saying their contributions to technological innovation are central to the existence of the IT economy. MSFT is one the best marketing companies in the business -- in fact one of the best marketing companies in any business. Brand managers would do well to study MSFT in detail. But if MSFT gets taken apart for abusing the market power acquired as a result of being such a great marketing company -- and that violation is now a point of law -- it will have a positive impact on the IT economy. Why? Because it will increase competition without harming the innovation process. Our whole economy is based on competition and innovation is enhanced by competition -- not by monopolies. We can easily live without MSFTs derivative products -- but we cannot have a vibrant IT economy without the rule of law and market competition -- these are the real principals at stake here. Fortunately, the IT world is so rich with innovation that not even MSFT could hold back the tide. MSFT did, however, inflict serious harm from time-to-time -- violations for which it now stands convicted. Breaking up the company helps provide for the health of our economic system. It may not be necessary -- competition is very hard to kill, and monopolists don't have a good track record for keeping up in fast moving industries. But it is justice -- and MSFT might not be able to escape that justice. <You think Excel is a simple piece of software?> I think Excel is great -- it has never failed me and it is user friendly. I think word is great too -- both completely derivative -- but fine products. <And someone else could have painted the Mona Lisa> Actually, lots of people could copy the Mona Lisa -- and perhaps "improve on it". But it would not make them "great artists" -- or innovators. Come on Eric, all the breakthroughs were other people's work -- MSFT is a marketing organization that packages code a little better --when the business model is working. Just as it was with ATT, breaking up MSFT will be good law and good economics -- and good for the innovative energies of the IT economy. FWIW, transaction cost economics still provides the rationale for and against anti-trust enforcement. I won't go through it here or now, but there is nothing in the economics literature either that would lead to the conclusion that breaking up MSFT will harm anybody except MSFT and its shareholders. The years of civil suits which confront MSFT now will be an endless nightmare -- if I was a big shareholder I would be really, really upset with the way MSFT management bungled this lawsuit. But I do not work for the DOJ or a MSFT competitor. I do not own MSFT stock or have a short position or derivatives on MSFT.