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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Gary Gardina who wrote (23013)	2/23/1999 2:18:00 AM
From: Uncle Frank	Respond to of 77400

Gary, do you invest in Cisco? And how do you assess the upcoming encounter with lu/asnd? tia Frank

To: Gary Gardina who wrote (23013)	2/23/1999 2:21:00 AM
From: jach	Respond to of 77400

Very likely similar expansion of FTC probe will cross over to the networking world when many startups and resellers voice their concerns. CSCO can potentially be the key target. imo =================================== Intel Case May Be Expanding (02/22/99, 8:36 p.m. ET) By Mary Mosquera, TechWeb A long list of witnesses from Intel and the government indicates the Federal Trade Commission may be expanding its case and Intel is stepping up to the plate to accept the challenge. The FTC says Intel used its monopoly in microprocessors to deny three of its customers and potential competitors access to technical information needed to develop products based on Intel's chips. Intel says it was within its rights to withhold data because of pending patent-infringement suits brought by computer workstation maker Intergraph and Digital Equipment -- which was later bought by Compaq. The trial begins March 9. "It's a little bit of a stretch to bring antitrust into this dispute," said Jeffrey Shohet, antitrust attorney and managing partner of Gray Cary Ware & Freidenrich, based in Palo Alto, Calif. Intel said it must compete with aggressive companies, such as Advanced Micro Devices. The FTC said it agrees there is competition in low-end chips, but the Santa Clara, Calif.-based company monopolizes the high-end serving corporate networks. Antitrust laws generally don't cover competitive harm in partial markets, said Shohet. "Most courts that have addressed a premium market in antitrust say there is no premium market under law," said Shohet, citing a case against Haagen-Dazs, which had 80 percent of the premium ice-cream market, but a smaller piece of the total frozen confection market. The ice-cream maker was accused of abusing its power in the high-end market, but the court concluded there was no such thing as a premium market. "If the FTC prevails, if you have a contract and have market power, you will be limited in your rights and obligations under contract," he said. It will be unique and not very applicable to other cases, he added. The expanded number of witnesses is an indication that the FTC focus is shifting, said William Kovacic, an antitrust professor at George Washington University in Washington, D.C. When the FTC slapped Intel with the suit in June, it was principally looking at its relationships with Intergraph, Digital, and Compaq. Its chief concern was that Intel was using its dominance to suppress innovation by major customers by forcing them to submit their intellectual property. The government's expansion of its antitrust case is similar to the pattern in the Microsoft case, Kovacic said. "The case the government brought is not what it is now," he said. What the FTC may try to prove about Intel could be a variance on the Microsoft theme -- that the chip maker pressured its partners." Intel's policies of requiring customer companies to surrender ideas may have the net effect of discouraging innovation in the first place, Kovacic said. "Intel absorbs the intellectual property of its customers like a vacuum cleaner. Intel gets the benefit of everything the client has done, which ensures Intel doesn't fall behind the client." The government may be considering whether some computer makers enhance Intel's microprocessor with their own features, in effect distracting the end user from looking for one thing only -- Intel Inside, Kovacic said. "Intel wants its chip to be the overriding reason why customers buy a computer," he said. "Intel doesn't want the significance of its microprocess to be diminished because then they may have to charge less for it."

To: Gary Gardina who wrote (23013)	2/23/1999 2:30:00 AM
From: jach	Read Replies (1) \| Respond to of 77400

Can potentially face many Private Antitrust Lawsuits as seen from MSFT news below. If what you said was correct, then sooner or later will happen. imo. =================================== Microsoft Faces Private Antitrust Lawsuits (02/22/99, 8:03 p.m. ET) By Reuters Microsoft has been charged in two private antitrust lawsuits that could mark the start of a flood of new litigation against the software giant, attorneys said Monday. A small Texas-based company and an individual in California filed separate class-action lawsuits last week charging that Microsoft has illegally kept software prices high through its market dominance. Gravity, based in Fort Worth, Texas, sued Microsoft and three of the nation's biggest computer makers over the pricing of computer operating systems and software for word processing and spreadsheets. Microsoft's Windows operating system is loaded on roughly 90 percent of the world's new personal computers, while its Word and Excel applications hold a better than 80 percent market share. Gravity, which specializes in document and evidence management for the legal market, also contends that Microsoft harmed it by failing to disclose application interfaces, or APIs, needed to develop programs that sit on top of Windows. If certified, the class action would encompass millions of Americans who have bought computers in the past five years that were made by Compaq, Dell, or Packard Bell NEC and pre-loaded with Microsoft software. Officials of the computer companies could not be reached or said they had not yet seen the complaint. A similar suit, filed in California state court by a San Jose man, targets only Microsoft. "There's nothing new in this suit that we haven't seen before," said a Microsoft spokesman, who added that the company has kept the price of Windows low and cut the price of its application software due to competition. But a law professor following the antitrust action against Microsoft said many more private cases would be filed. "There is no question there will be more of this," said William Kovacic of George Washington University. He said prospective plaintiffs had been emboldened by the government's strong showing in the federal courtroom in Washington, D.C., where the government antitrust case against Microsoft has been unfolding since October. "Judging from people I see in the courtroom now and then, it's apparent that quite a few are handicapping the race, deciding whether or not to bet on their own cases," he said. A government victory in the case, which many analysts now expect at the trial level, would ease the burden of plaintiffs by establishing the fact of Microsoft's monopoly in the operating system market. Plaintiffs still would have to prove economic harm, which could be a significant hurdle. In any event, the private lawsuits could create an additional distraction for Microsoft, already deeply entangled in litigation with rival Sun Microsystems as well as lawsuits filed against it by smaller rivals.

To: Gary Gardina who wrote (23013)	2/23/1999 9:47:00 AM
From: Doughboy	Respond to of 77400

Cisco has been a worse monopoly than Microsoft for several years. Gary, we have to distinguish between "monopoly" in a generic sense and "monopoly" in the legal sense. Cisco is by no means a monopoly, legally. The only tech company that has close to a monopoly is Microsoft, since there is no reasonable alternative to Windows. But look how hard it is to prove even that point for the government. What do you believe that Cisco has a monopoly in? Cisco "owns" 60-70% of the router market. Are there competitors? Sure. Many. Are there new entrants into the market? Yes, all the time. Cisco is competing ferociously; that's not monopolization, that's the free market at work. All the other segments Cisco competes in, it has a 20-25% market share. There simply is no case to be made that they monopolize any segment of the networking market. As for the IOS, I am not really informed about that, but my assumption is that customers have better compatibility with Cisco products, however, if they decide to buy not a single piece of Cisco equipment, they still can use the IOS; they can still offer services to customers that are competitive, and in fact, there are probably many carriers out there who haven't bought any Cisco equipment for their networks. Where's the monopoly? How has Cisco leveraged the IOS to squelch competition? What you have said is that Cisco takes away their discount if you don't resell enough of their products. What's wrong with that. I give my best deals to my best distributors or customers. That's competition. The government has no case against Cisco--and that FTC official basically confimed it when he said that there was no activity on the investigation into Cisco (although that investigation was opened on an entirely different matter--the discussions with LU). Doughboy.