A duel of thumbs
Every time the government suffered a setback in its case against Microsoft, it pointed to some different monopolistic sin the software giant had supposedly committed, until finally and almost inevitably Microsoft was tripped up, like one of those towering military machines lassoed around its mechanical feet in a ”Star Wars” movie.
The firm’s original sin was said to be ”bundling.” The Justice Department’s accusation was that Microsoft was using its monopoly as a provider of PC operating systems to establish a like monopoly as a provider of browsers. The firm was tying these browsers to its operating system package not because it wanted to serve the needs of consumers, the government said, but because it wanted to eliminate competition.
Well, maybe, but the fact is that consumers did want these browsers; they were a splendid convenience. And although the law’s application to the world of high-tech sometimes gets murky, there was legal precedent indicating that Microsoft’s bundling was permissible, not much different from an auto manufacturer putting its own radios in its cars. An appeals court said as much, but the government marched forward, contending, for instance, that Microsoft had set itself up to escalate prices drastically.
Again, maybe. There’s a problem, though. Microsoft had lowered prices and never gotten around to hiking them. An undeterred Judge Thomas Penfield Jackson found against the company this week, saying it had placed ”an oppressive thumb on the scale of competitive fortune.” Some of those competitors happen to be thriving today, while Microsoft faces a future made uncertain by the Internet. It may be true, as the judge said, that competitors might have come up with wondrous innovations if Microsoft had been less the bully. Who knows? What is known is that Microsoft’s own innovative energy has helped propel the U.S. economy into something approaching a golden age.
This antitrust case might have been settled in a reasonable manner except for the intervention of attorneys general from states greedy for a piece of the action and not about to abide anything less than unconscionable gouging. Now all will await, first, Jackson’s proposed remedies – will he decide to break Microsoft into so-called Baby Bills? – and, second, the piranhalike private suits that could nibble the company to near-death. Ultimately, after years of appeals, Microsoft may emerge victorious over the Justice Department. Even if it does, the nagging question will be whether anyone is better off because of the government’s own heavy thumb on the scales of the marketplace.