I won’t pretend to be conversant with antitrust law or precedent, nor am I technically competent enough to ferret out the intricacies of Microsoft’s alleged competitive transgressions. It occurs to me, however, that this company is one of the great success stories of all time, not just for its management and shareholders, but also for American productivity and technological leadership, and that it is being judicially pursued primarily for this success. How were consumers damaged by the vastly lower prices and higher product and service quality spawned by Microsoft? Aren’t these the primary objectives of consumers? How was competition damaged and which competitors were damaged in what magnitude? One analyst reported that Microsoft’s primary competitive accuser had a total market capitalization of $10 billion at the time of the antitrust suit, the total destruction of which would pale in comparison with the actual destruction of over $200 billion in Microsoft’s market value since the suit was filed. This represents real destruction of wealth to thousands of shareholders, not to mention the ripple effect throughout the equity markets, which I believe has had as much to do with the recent severe market correction as Federal Reserve monetary policy and other factors. I believe this case will have long term negative repercussions in attitudes about innovation and risk-taking that will far exceed any possible perceived competitive benefits. If monopoly per se is what the Justice Department is after, I agree with Walter Williams when he asks why they don’t break up the postal service and the public school monopolies, where some real damage has been done to consumers for many years in terms of higher cost and lower quality.
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