Microsoft's Illegal Monopoly
Constantine Stellatos
Oral Communication
Professor Scalingi
March 18,2002
Microsoft's Illegal Monopoly
In today's day the software market is increasing extremely rapidly, in spite of the many arguments surrounding it. Most of the controversy is centered around Bill Gates and his company Microsoft. Some believe that Microsoft is running an illegal monopoly. They are ruling smaller companies by buying them out and taking over their products. I for one consider Microsoft to be running a illegal monopoly, especially in the software and computer desktop market. It appears to me as though these markets are owned and controlled entirely by this giant company. They are doing unfair things, like using their wealth to do as they please in the software market. I congratulate Microsoft for all that they have done to become a monopoly. The reason why they are getting in trouble is because they became a monopoly the wrong way. They were making some products and even losing money in order to make their competition become bankrupt. This was unfair and declared illegal.
Microsoft's monopoly appears to be misleading to many, but the word is getting out. Many claim they are using unlawful tactics to monopolize the software market. There has been many law suits taken out against the software powerhouse, thus one of these contain evidence that Microsoft has violated the rights of its rivals. Deseret News author Anne Gearan writes an article titled "Will Microsoft's own words condemn it?" Within this article, she explains how Microsoft's head executive Bill Gates has discouraged Intel Corporation to not distribute a product called NSP (Native signal Processing). This is a computer language that threatens Microsoft's. Gearan says, "Bill Gates had a three hour dinner with the head of Intel Corp. On July 7, 1995 Gates told a Microsoft executive 'the main problem between us (Microsoft & Intel) right now is NSP. We are Trying to convince them basically to not ship NSP." Bill Gates has unintentionally said too much. In his demand to stop Intel from distributing NSP, Gates causes Microsoft to lose the law-suit. In regard to the court case, Gearan claims, "The government found Microsoft guilty of using its money and influence to intimidate computer makers." It looks as though Microsoft did use its wealth to persuade another company in this situation.
As we use our computers in everyday life, we can notice that nearly everyone uses products by Microsoft. I still have yet to find a computer that does not contain some product produced by Microsoft on it. An aspect to consider in Microsoft's monopoly is how much of the market do they really own? In the Deseret News, Scott McNealy wrote an article titled, "US right to challenge Microsoft? Yes". In this article, he gives a considerable estimate of how much of the desktop computer market Microsoft owns. McNealy says,
"One thing we are learning every day ...
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As we use our computers in everyday life, we can notice that nearly everyone uses products by Microsoft. I still have yet to find a computer that does not contain some product produced by Microsoft on it. An aspect to consider in Microsoft's monopoly is how much of the market do they really own? In the Deseret News, Scott McNealy wrote an article titled, "US right to challenge Microsoft? Yes". In this article, he gives a considerable estimate of how much of the desktop computer market Microsoft owns. McNealy says,
"One thing we are learning every day from the events taking place in Washington D.C., is that Microsoft's monopoly in the desktop market is indisputable. The protestations of Bill Gates and his lawyers aside, Microsoft's operating systems control 90 to 95 percent of this class machines."
If Microsoft really does own this much of the market, it should speak for its self that they truly do monopolize this market. Although, McNealy is the chief Executive of a Microsoft competitor, Sun Corporation, his information seems to be faithful. Some say this much control over a market has a great effect upon all of us as the consumer. We should take into consideration the quality of the products and the price we pay for them. We should also take into consideration how this much control can effect the future development of the products. With this kind of a lack of competition, it could hold back future products from reaching their full potential. The value of the products we purchase should be questioned. Others say, if Microsoft really does control 90 to 95% of the market, it's because their products are the best available right now. Microsoft offers the best product for the best value. I think Microsoft can produce good products. They can dictate the price and quality of the products distributed with this much control over the market. We should question whether or not better products are being held back, by Microsoft paying them to hold the products.
We have just learned how widely used Microsoft's products are, but how have they distributed their products to be so widely used? Some say Microsoft has forced its products onto the consumer, thus causing its competitors to be pushed out of the picture. Others say that couldn't be true, because how could they force a consumer to purchase their products. It's a free market and the consumer always has the right to purchase as they pleases. For myself, I consider Microsoft to be pushing out the competition by forcing their products onto the consumer. When Microsoft sells one program, there is usually another program you buy with it. When we buy these package deals we eliminate the possibility of purchasing the other program from another Manufacturer. This appears to be a common practice in all free markets, but it is even more so in the software market. In Newsday, Susan Benkelman wrote an article titled "Microsoft Warned". In this article she discusses a law suit taken out against Microsoft. Implying that Microsoft is being accused for illegally distributing their Internet browser. Benkelman claims "the company made anti-competitive licensing agreements that require personal computer manufacturers to sell the browser." This claim has been made against Microsoft, because they were selling their Internet browser with Window 95. Since so many computer users have or will purchase Window 95 this made it widely available. Benkelman continued "In this case, the Justice Department was backed up by Netscape Explore who owns 70% of the market. Netscape claims, 'Microsoft is using the market dominance of Windows 95, to unfairly gain the upper hand in the browser market." By this article, it appears Microsoft is using its market control to reach out into other markets.
This giant company has done more than just stretched out its wings and tried to fly. They are reaching for greater heights when it comes to expanding their company. They are growing strongly and boldly. Some say they are trying to run a monopoly, and they are trying to do it unfairly. These people say this because, in Microsoft's demanding way they try to control the software market. To them it appears as though they don't want to compete fairly, but they do want to have full ownership of the market. Others might say Microsoft is only trying to produce the best product they can. Saying Microsoft is competing as fair as everyone else. I feel Microsoft is trying to monopolize the market the wrong way. They are using their massive bundles of money to buy as much of any market they can get a hold of. When it is necessary, they try to sneak things by the consumer and other companies. For example: In the Deseret News, author Eun-Kyung Kim wrote an article titled, "Microsoft says it tried to improve Java computer language". Eun-Kyung shows both sides of a dispute between Microsoft and Java. Java is a computer language that runs on a variety of computers. Sun Corporation offered Microsoft to work with them on a deal to improve Java. While in the process of improving Java, something went sour. Sun Corporation says "Microsoft tried to 'Pollute' Java and sell it," while Microsoft claims "we were only trying to improve it. In Kim's article she states, "the Justice Department contends that Microsoft illegally tried to alter Java because it considered it a threat to Windows." As such Microsoft denied the accusation. Although, Microsoft lost the case, which alluded to the lose of their Java sales. The Judge stated, "Microsoft is trying to portray itself as a competitive company aiming to produce better products." They do portray themselves like this to many, but they are becoming more noticed for other things.
Even though Bill Gates is leading Microsoft to be the most successful company, he is still hated by many. In the New Republic, writer David Shenk titles an article, "Slamming Gates". Shenk explains why Bill Gates has become an easy target for haters to pock fun of. There is website called "Boycott Microsoft." This website was created when Microsoft began giving Explorer 3.0 for free. This was Microsoft's effort to destroy a smaller competitor. Shenk states,
"In a properly functioning competitive environment, rivals who create better products could withstand such pressure. But when Gates is faced with a competitor he can't easily be beat, he either crushes or purchases it thus ELIMINATING the competition. The basic model in the industry today is to be bought by Microsoft or to go out of business." He also stated. "Marc Andreessen, Netscape's co-founder, has publicly compared Microsoft to the Mafia."
With this kind of intimidation the competitors are running for their lives. Some of these haters have compared Microsoft to the Mafia. Such accusations seem harsh , but true in some. We have discussed the many controversies surrounding Bill Gates', Microsoft. There have been many claims against this giant company. They have been found guilty of trying to monopolize the market illegally, but the law hasn't found them guilty of monopolizing the market. Although, many people believe they are, many think they aren't.
WORKS CITED
Gearan, Anne. "Will Microsoft's own words condemn it?" Deseret News 20 October 1998,1+.
McNealy, Scott. "US right to challenge Microsoft? Yes" Deseret News 16 Jan. 1999, 1+.
Kim, Eun-Kyung. "Microsoft says it tried to improve Java computer language" DeseretNews 11 Dec. 1998, 1+.
Shenk, David. "Slamming Gates" NEW REPUBLIC 26 Jan. 1998, 20-23.
Benkelman, Susan. "Microsoft Warned" Newsday Oct. 21, 1997, A3.
