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The Anti Trust Case Against Microsoft Essay

3034 words - 13 pages

Since 1990, a battle has raged in United States courts between the
United States
government and the Microsoft Corporation out of Redmond, Washington,
headed by Bill
Gates. What is at stake is money. The federal government maintains that
Microsoft's
monopolistic practices are harmful to United States citizens, creating
higher prices and
potentially downgrading software quality, and should therefore be
stopped, while
Microsoft and its supporters claim that they are not breaking any laws,
and are just doing
good business.
Microsoft's antitrust problems began for them in the early months
of 1990(Check
1), when the Federal Trade Commission began investigating them for
possible ...view middle of the document...

After the
settlement, Microsoft would be forced to sell their operating systems
according to the
number of computers shipped with a Microsoft operating system installed,
and not for
computers that ran other operating systems. (Check 2)
Another practice that the Justice Department accused Microsoft of
was that
Microsoft would specify a minimum number of minimum number of operating
systems
that the retailer had to buy, thus eliminating any chance for another
operating system
vendor to get their system installed until the retailer had installed all
of the Microsoft
operating systems that it had installed.(Maldoom 2)
In addition to specifying a minimum number of operating systems
that a vendor
had to buy, Microsoft also would sign contracts with the vendors for long
periods of time
such as two or three years. In order for a new operating system to gain
popularity, it
would have to do so quickly, in order to show potential buyers that it was
worth
something. With Microsoft signing long term contracts, they eliminated the
chance for a
new operating system to gain the popularity needed, quickly.(Maldoom 2)
Probably the second most controversial issue, besides the per
processor agreement,
was Microsoft's practice of tying. Tying was a practice in which Microsoft
would use their
leverage in one market area, such as graphical user interfaces, to gain
leverage in another
market, such as operating systems, where they may have
competition.(Maldoom 2) In the
preceding example, Microsoft would use their graphical user interface,
Windows, to sell
their operating system, DOS, by offering discounts to manufacturers that
purchased both
MS-DOS and Windows, and threatening to not sell Windows to companies who
did not
also purchase DOS.
In the end, Microsoft decided to suck it up and sign the
settlement agreement. In
signing the agreement, Microsoft did not actually have to admit to any of
the alleged
charges, but were able to escape any type of formal punishment such as
fines and the like.
The settlement that Microsoft agreed to prohibits it, for the next six and
a half years from:
-Charging for its operating system on the basis of computer
shipped rather than on
copies of MS-DOS shipped;
-Imposing minimum quantity commitments on manufacturers;
-Signing contracts for greater than one year;
-Tying the sale of MS_DOS to the sale of other Microsoft
products;(Maldoom 1)
Although these penalties look to put an end to all of Microsoft's evil
practices, some
people think that they are not harsh enough and that Microsoft should have
been split up
to put a stop to any chance of them forming a true monopoly of the
operating system
market and of the entire software market.
On one side of the issue, there are the people who feel that
Microsoft should be
left alone, at least for the time being. I am one of these people, feeling
that Microsoft does
more good than bad, thus not necessitating their...

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