Antitrust Act

Anti-trust Acts in the Information Age As many people have noticed, recently there has been a huge focus in the media on Bill Gates, and his huge Microsoft Corporation. This past Friday, May 22, 1998, a federal judge combined two lawsuits and set a trial date for September 8, 1998. This trial date will address a government request for a preliminary injunction concerning Windows 98 as well as broader issues. The Sherman Anti-trust Act was passed in 1890. Then in 1914 the Clayton Act was passed to help with Anti-trust Cases. Anti-trust Lawsuits are few and far between, but recently cases against Microsoft are stacking up all around the world. In 1890 the Sherman Anti-trust Act was passed, but it was not until much later that it was enforced. The Act stated "every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations." The Sherman Anti-trust act was too vague and too difficult to enforce. The Clayton Act of 1914 helped this problem by making a more specific attack on monopolies. Things like predatory price-cutting, price discrimination, and acquisition of stock in a competing company with intent to destroy competition all became illegal. John D. Rockefeller is a prime example of monopolies in US History. By buying out competitors, or driving them out of business he obtained nearly 100 percent of the market in oil refining. The Standard Oil Company was eventually forced to dissolve into smaller companies after the case Standard Oil Company vs. United States, 221 U.S. 1 (1911). Before this case the Anti-trust Laws had not been put to much use, which was not to the benefit of consumers. Now the spotlight is on Microsoft Corporation, and their apparent attempt to take over the Internet browser market. Concerns aroused recently because of the expected release of Windows 98, which uses Microsoft Internet Explorer in almost every application it runs. The US government has seemingly acknowledged Microsoft's monopoly of operating systems and let it go by because of lack of competition in the market. But now new issues are at stake, should Microsoft be allowed to expand its already almost monopoly into yet another field in the computer industry? With the incorporation of Microsoft Internet Explorer into the Microsoft operating system Windows 98, Netscape Communications Corporation felt vulnerable, and filed complaints with the Justice Department. Once the investigations were initiated, it seemed flocks of people jumped the bandwagon to attack the alleged Microsoft Corporation Monopoly. 20 State Attorney Generals and the District of Columbia, along with the Justice Department have filed against Microsoft Corporation. Japan has also filed an Antitrust Lawsuit against Microsoft. It seems that everywhere Microsoft is, there looms a bit of concern for the consumers and their futures. Currently 90 percent of the world's personal computers run on Microsoft operating systems. The remaining ten percent of the industry is divided between Apple's Macintosh, IBM's OS/2, and Unix. The federal and state antitrust regulators are arguing that Microsoft has illegally used the popularity of its operating systems to eliminate its competition in the software industry. Many economists feel that these lawsuits against Microsoft Corporation could be as revolutionary as those against Bell Telephone in 1984 and John D. Rockefeller's Standard Oil Company in 1911. Microsoft Corporation however, disagrees, arguing that the changes being demanded by federal and state government will take months to perform and would cause the software to be useless. Microsoft clings strongly to their beliefs that Windows 98 cannot succeed without Internet Explorer. "Such an operating system - which would take many months (if not years) to develop and test - would bear little, if any, resemblance to Windows 98 because Internet Explorer technologies are such a critical element of that product," Microsoft wrote. Although it may be true that Windows 98 is based around Internet Explorer, should the government allow Microsoft to sell its product and gain more market share? One option that federal and state governments gave Microsoft was to have the Windows 98 package be sold with the Netscape Navigator Browser, Microsoft's main competitor. This request was seen as ridiculous by Mark Murray, a spokesman at Microsoft headquarters, who has been quoted as saying, "that's like the government forcing Coke to put two cans of Pepsi in every six-pack." The only choices being offered to Microsoft at this point are to "unbundle" Windows 98 and Internet Explorer, or to add in the Netscape Navigator Browser. The unbundling process is what Microsoft Corporation says will take seven months to handle, and therefore had asked for a delay for the court dates. The federal and state governments were demanding immediate court dates to assure that Microsoft would not be able to market Windows 98 as it is now. A compromise was made between the two differing requests, and the court date was set for September 8, 1998. Some foresee this as an advantage for Microsoft who will be able to sell their products through September. But the federal and state governments are happy that the court is not allowing them to go through the immense Christmas buying frenzy as well. It is most likely to the advantage of Microsoft more so than the government that the date was set for September, but only time will show what happens. These lawsuits allege that Microsoft Corporation is using its power with Windows