United States vs. Microsoft Based

United States vs. Microsoft Based on Internet research, write an analysis of 750-1,000 words on the merits of the DOJ's antitrust case against Microsoft and the company's defense. The merits of the DOJs antitrust case against Microsoft includes: a near monopoly of the different operating systems, the bundling of their operating system with Internet Explorer and protecting Windows against possible threats from competitors.

The first strength of the government's case against Microsoft (a near monopoly of the different operating systems) highlights the 80% to 90% market penetration that gave the company an unfair advantage. As computer manufacturers and distributors were enticed to use Microsoft's operating system, because they were preinstalled. This is significant, because it highlights how the government had evidence of the near monopoly practices of the company, which would give them an unfair advantage.

("In United States District Court") The second strength of the government's case against Microsoft was: the bundling of their operating systems with Internet Explorer. What happened was Netscape had built a web browser that could work with any kind of operating system. Realizing that this was a possible application that could undermine demand for Windows; Microsoft began to produce their own web browser called Internet Explorer. At which point, they begun to ship this browser with their operating system, as the only choice consumers would have.

Where, this would undermine the need for Netscape's web browser. This is important, because it shows how the company would use its operating system, as a way to prevent anyone from being able to create applications that could benefit competitors. ("In United States District Court") The third strength of the government's case was that Microsoft would protect Windows against any kind of possible competitors. In this case, Microsoft would often engage in various exclusionary agreements. These were contracts that the company would sign with software developers and manufacturers.

Where, they would agree to only allow their applications to be used with a Windows-based operating systems. This would help Microsoft be able to maintain their dominance in the market, while making it very difficult for new competitors to distribute their products. This is important, because it shows how these agreements would make the potential entry of new competitors more challenging. At which point, they would have a near monopoly on the personal computer market.

("In United States District Court") The merit of Microsoft's defense was: the ability of the company to innovate. This is important, because they would use this as a way to highlight, how the government was overreaching and the impact of any kind of adverse rulings on the technology sector as whole. A good example of this can seen with an ad; that the company would support that was taken out in the New York Times (on their behalf by MasterCard).

Where, it would say, "Consumers of high technology have enjoyed falling prices, expanding outputs, and a breathtaking array of new products and innovations. High technology markets are among the most dynamic and competitive in the world, and it is a tribute to open markets and entrepreneurial genius that American firms lead in so many of these industries. But, these same developments place heavy pressures on rival businesses, which must keep pace or lose their competitive races. Rivals can legitimately respond by improving their own products or by lowering prices.

Increasingly, however, some firms have sought to handicap their rivals' races by turning to the government for protection." (Theroux) This is significant, because it shows that Microsoft's greatest strength was their ability to innovate, as the article highlights what the perceived government actions could do. As a result, this argument would be effective in helping to have their cases against them, overturned in the U.S. Court of Appeals. Delineate which market participants benefited from the final court decision and whose interests were harmed.

The company that benefited the most from this decision was obviously Microsoft. As they could use the final ruling to be able to maintain their market share and not have to worry about the possibility of being broken up. This is important, because the decision would mean that future actions taken against the company would be more watered down. The different losers in the case would include a host companies such as: Sun Microsystems, Oracle, Apple and Red Hat.

Where, they would feel that Microsoft was not complying with any kind of decision and maintaining their dominance. Commenting about what was taking place Sun Microsystems would release the following statement, "The weak steps that Microsoft has taken to comply with the requirements already show that the settlement will be ineffective in curbing Microsoft's monopolistic and anti-competitive practices. We will continue to pursue our civil case and to cooperate with the European Commission's case against Microsoft.