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

To: Bill Fischofer who wrote (63337)	11/25/2001 3:03:32 PM
From: Dave	Read Replies (1) \| Respond to of 74651

You can switch phone companies any time you want. You just have to throw away your existing phones, get a Net2Phone account, and make all your calls from your PC. Then tell everybody that you have a new phone number, and you're up and running. You'll get all those nice phone features you are missing, you'll have taken a stand against the local phone monopoly, and you'll have lower prices. But of course you haven't done that. Why not? Well, the local phone monopolies have exercised their monopoly power to prevent Net2Phone from interoperating smoothly with their system. And you don't really want to throw away your phones and replace them with new ones and then end up with a system that doesn't interoperate smoothly with the monopoly standards. Now think about all of the consumers who dislike Microsoft and would gladly switch to Linux or Macintosh if only they (1) ran on their existing machines, (2) ran their existing software, and (3) interoperated smoothly with the monopoly standards. There are such people, believe me. Many of them are former Mac users and OS/2 users who finally bit the bullet and switched just so that they could run some Windows-only software that their employer requires, or so that they can run some Windows-only software that Microsoft has stopped supporting on Mac (like Visual BASIC). So you see, you are still using your annoying local phone service rather than Net2Phone or some other competitor for much the same reason that many people still use Windows. Because of the network effect, the advantages of switching would be outweighed by the costs. And in the case of Microsoft, those network effects are much more powerful than in the case of the phone company. Unless Microsoft is forced to support AppleTalk file-sharing in their client software, and publish all of its file-specs, and port Office to Linux, this may continue to be the case. Or they could have been broken up into separate companies and the problem would have solved itself. By the way, in addition to our mutual dislike for the local phone service monopoly, I agree with you about AOL as well. Fortunately, despite the fearsome size of AOL Time Warner, they have no monopolies as powerful and entrenched as Microsoft's. Dave