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Microsoft Defies EU Commission
otahkgeek writes "Wired News is reporting that Microsoft claims that by removing Windows Media Player from Windows, it would be forced to ship a substandard version to European consumers. This is on the heels of a three-day hearing by a European commission to determine the validity of charges that Microsoft illegally abused its power over the home computer market."
First of all, a monopoly is "the only supplier of a product for which there is no close substitute." (according to my Modern Industrial Organization textbook, by Carlton and Perloff.) This definition, and most others, have nothing to do with "market rights from the government". Those are simply government-established monopolies.
Now, from a practical standpoint, a company is a monopoly if it exerts too much influence in one market (basically a company that is close to a textbook monopoly). They have the ability to manipulate price to increase profits for themselves and by doing so create a deadweight loss to market (consumers lose a lot, monopoly gains some, some "welfare" just goes away).
Monopolies can be "natural" in some markets, usually those where fixed costs are high (think electrical companies with massive grids and expensive power plants). Many monopolies are left alone as long as they don't (overly) abuse their market power, usually by using that market influence to gain influence in a new market. This brings about anti-trust actions. With Microsoft, they leveraged their operating system "monopoly" to make their Internet Explorer the dominant browser in the market (by giving it away and tying it to the OS). They have been found guilty of this, but it's easy to see them using their market power in other areas as well.
Even if you were to define a "monopoly" as a company given that power by the government, one can make an argument for that with Microsoft as well. Copyrights and patents are what allows Microsoft to produce products that others could not simply resell at a lower price, decompile/disassemble and release the modified code, etc. (legally). However, most people see a need for copyrights and patents to encourage people to produce "intellectual property" and be able to make some money off of it.
In general, the function of government is to try to improve the welfare of its citizens, and reducing a monopoly's power has that effect.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
A monopoly is a company that gets exclusive market rights from the government.
No, that is a definition of a utility, such as a power company, or cable service. The price that the entity pays for having exclusive rights is that it is HEAVILY regulated by the local, state, and federal government. Are you suggesting that Microsoft is a not a monopoly, but a utility that should be subject to heavy government regulation?
The US Postal Service is a monopoly
Technically, no. The US Postal Service was considered an organ of government. Do you call the Federal Judicial system a monopoly? The federal government has offloaded that function to a non-governmental entity, in order to improve its efficiency.
Standard Oil was a company that did not get exclusive market rights from the federal government, but was able to use its market position to extort profits from its consumers. It was also able to crush competitors by either lowering its prices to prevent either of them from making a profit, or prevent them from gaining access to materials to produce their product. This is the generally accepted definition of a monopoly. It does not require a coercion from the government.
While I do respect your libertarian point of view, I question whether you genuinely understand what constitutes a monopoly.
There is no America. There is no democracy. There is only IBM and AT&T and DuPont, Dow, General Electric, and Exxon
I wonder if the EU has thought of just including MS products in the 100% tariffs category (along with things like sunglasses and motorbikes) that they are allowed (by the WTO) to impose on imports from the US as a retalitory measure to the illegal US steel tariffs. Come to think of it, weren't countries like Japan, China, Korea, Australia as well as a host of others also part of the WTO judgement (on the side of the EU) as well?
So Dubya, keep those illegal steel tariffs! Remember you need to win votes in steel producing states in the next election!
No. Microsoft is a convicted monopolist. A US court actually found them guilty, although the punishment was a slap on the wrist. This means that Microsoft has been found to use illegal activities to lock-in customers, so that they cannot switch without substantial (possibly insurmountable) burden. You cannot let them do "whatever," because they will exploit illegal methods to prevent people from "building upon non-MS operating systems."
My Greasemonkey scripts for Digg &
Last time I checked Apple did not have exclusive deals with OEMs so as to have QuickTime preinstalled on each and every PC sold.
Monopolies have additional limits to what they do, so that they don't abuse their position on the market. MS falls in this category, Apple does not.
Maybe we deserve this world ?
They are not a legal monopoly.
Correct. They are an illegal monopoly.
The nature of legal monopolies is that they are extremely regulated by government bodies. This is required because there are not the market forces in play to ensure fair play by the monopolies.
Those interested in a nicely-hacked, small-footprint version of WMP should take a look at Media Player Classic.
The nice thing about WMP is that it's a self-contained executable, it allows you to add any DirectShow filters you may have installed, supports Quicktime and RealMedia (that's right! get rid of those ugly, bloated pieces of dogshit), as well as DVD support and built-in support for TV cards.
Basically, it does everything, weighs in at under a meg, and looks and feels just like Media Player 6.4. Get it. Now.
Correct,
however the President of the EU changes every 6 months and has very little power (at present, this might change). He's just a figurehead. The real power is held by the Comission and the minister council (which consists of the leaders of every member state (Blair, Scroeder, etc..))