A Double Standard of Justice Toward Microsoft

by | Jan 5, 1998

In 1988, Microsoft offered manufacturers of personal computers a considerable discount on the licensing fees they pay to install MS-DOS and Windows operating system on new PCs prior to their leaving the factory. In exchange it required manufacturers to pay for each computer they make, whether or not it included MS-DOS. Microsoft now requires PC […]

In 1988, Microsoft offered manufacturers of personal computers a considerable discount on the licensing fees they pay to install MS-DOS and Windows operating system on new PCs prior to their leaving the factory. In exchange it required manufacturers to pay for each computer they make, whether or not it included MS-DOS. Microsoft now requires PC manufacturers to either install their Internet Explorer (IE) Web browser icon as an integrated part of Windows or lose their licenses to sell these operating systems on their computers. According to the U.S . Department of Justice, executives from Compaq, Gateway 2000 and Micron, among others, testified on how Microsoft warned them it will revoke their licenses if they in any way modify Windows or remove their IE icon from the desktop start-up screen.

The latter allegedly leaves Microsoft in violation of its 1995 anti-trust “settlement,” a settlement based on a “consent decree” the Justice Department imposed on Bill Gates, which he signed to avoid the threat of government’s forcible dissolution of his company.

These testimonies prompted Attorney General Janet Reno to ask a Federal court to demand Bill Gates, Microsoft’s founder and Chairman, to either drop his requirements or pay a fine of $1 million daily. The suit depends primarily on whether IE remains an independent product of Windows or is already an integrated feature of it. The latter allegedly leaves Microsoft in violation of its 1995 anti-trust “settlement,” a settlement based on a “consent decree” the Justice Department imposed on Bill Gates, which he signed to avoid the threat of government’s forcible dissolution of his company. These demands threaten an antitrust suit against Microsoft’s planned integration of Internet Explorer and Windows 98. Since IE will be an integral part of that upcoming operating system, these suits contain grave implications for Microsoft’s future.

“Microsoft is unlawfully taking advantage of its Windows monopoly,” Janet Reno said on issuing her demands, “to protect and extend that monopoly and undermine consumer choice…. Today’s action shows that we won’t tolerate any coercion by dominant companies in any way that distorts competition.”1

When the offering of innovative, cheaper, popular products and honest, assertive, long-ranged business practices are analogous to “bullying” — that is, the initiation of physical force, it begets the actual bullying by government of dominant companies like Microsoft.

“Force,” “coercion,” “monopoly,” “unfair,” “competition,” “anti-competitive,” “consumer choice” are all terms used manipulatively by bureaucrats and many others, particularly in the media, to distort Microsoft’s abilities and practices. The common fears of a company’s dominance in a certain market are that it prevents others from competing against them on a “level playing field” or at all, thus harming or eliminating competition and “consumer choice” and discouraging innovations, thereby fostering lower quality products at higher prices

Joseph Kellard is a journalist living in New York. To read more of Mr. Kellard's commentary, visit his website The American Individualist at americanindividualist.blogspot.com.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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