Settling for More
Reynolds, Alan
SETTLING FOR MORE BY ALAN REYNOLDS A ntitrust works like any other regulatory bureaucracy. Business interests lobby to thwart their rivals. Key members of congressional committees shake down...
...Besides, there is no crime called "leveraging...
...The only conceivable purpose of expanding the "remedies" to cover software in which Microsoft is not even the leading provider--instant messaging and media players is simply to appease Microsoft's most rabid critics (in those cases, AOL and RealPlayer respectively...
...But the EU has also leaked threats of fat fines, perhaps because fines mean you don't have to actually identify any specifically illicit behavior in need of being fixed...
...Predictably, there have been gripes from half of the 18 state attorneys general who had been party to the original suit--particularly Democrats with higher political ambitions and generally those from states that are home to major Microsoft competitors...
...Such "threats" are not "nascent" they're fanciful...
...at Microsoft's modest share o,f~i~ s e ~ ~ ware market is somehow ~~!t~i[i~!i~~ inant UNIX produ~ersi T~ have [~i~ i ware, though here the Technical Committee offers an obvious way out...
...The deal is described as creating"opportunity for independent software vendors" and "giving computer manufacturers the flexibility to contract with [such] software developers...
...The word "bundle" appears as often as "leveraging," as though it were inherently anti-competitive to sell word processors with spread sheets, radios with cars, or knife blades with handles...
...and onci~~ ~h 3 8 01...
...The key provisions of the deal, however, have to do with allowing computer makers to promote "non-Microsoft middleware" even a whole new "non-Microsoft operating system" while preventing Microsoft from, say, retaliating against those companies by charging them a punitive price...
...The issue is not entirely settled, of course, because there is still the possibility of antitrust action by state attorneys general, private companies and the European Union...
...BROAD BOUND A lthough critics claim the agreement is "too narrow,' it is actually much broader than the trial itself...
...In addition, a threeman Technical Committee in Redmond will ensure that outside producers of such software have access to as much Windows code as they need to make their products fully competitive-and compatible--with Microsoft's...
...And Microsoft was never accused of monopolizing office applications--high market share only proves popularity, not monopoly...
...But the government's post-appeal complaints are not about tying, and cannot be applied to every Windows feature that some competitor prefers to see excluded...
...In late September, for example, the Consumer Federation of America released a report accusing Microsoft of"leveraging its illegally preserved monopolies in operating systems, the browser and office applications'Wet Microsoft was explicitly absolved by the Appeals Court of even attempting to monopolize browsers...
...European authorities managed to scuttle the GE~ Honeywell merger, and claim t0...
...Regardless of whether the new mandates and regulations are good or bad, they are clearly profitable for some key players...
...From this perspective, it was only natural that the Department of Justice press release about October's Microsoft settlement began by touting the benefits bestowed on other politically influential high-tech companies...
...Key members of congressional committees shake down predators and prey for campaign contributions...
...Others claim to see loopholes in a provision preserving secrecy for code the Technical Committee believes could compromise security and anti-privacy measures...
...Computer makers, for example, are invited to solicit fees for turning the Windows start-up screen into a billboard for software and Web site icons...
...In fact, the software business nat~ urally gravitates toward marketing better bundles, for two costs of research are ~ ~~ cost of addin~ ~ i~ Microsoft ~e er---scarcely an imminent non~olize mesa players would r theei 0 lth version of Media Player accomplish what:t~teprevlous se,v inamely, vanquisl~i~[:ilthe dot Plaver...
...And ambitious bureaucratic mandarins have an incentive to fabricate highprofile cases, because publicity opens the revolving door to high-paying positions in the affected industries...
...As the App~~~ observed, the govern ' ~~ ---~~ "almost exclusive!y Oi ~ ~ efforts to unse{r the case was does R.ealPlayer or QuickTime have to replace Windows, or to render us indifferent between Windows, Mac, Palm or Solaris systems...
...USA 7bday reported that some fear one provision "could make it tough for Justice or the states to sue Microsoft for tying separate products to Windows" But Justice has already dropped the "tying" charge as a sure loser.What little remains of the issue is legally complex, technologically challenged, and not expandable from Netscape's browser--the original focus of the suit--to all "midd]eware...
...Some want all required changes to occur almost instantly, which would be a good way to paralyze what is left of the computer industry...
...But this case was never abo~~ software market...
...The DOJ has gone overboard, claiming the deal would "restore competition in the software market...
Vol. 34 • November 2001 • No. 8
