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Doing the Math in the Microsoft Anti-Trust Cases
coupland writes "Bob Cringely has posted this week's column and has made some interesting comments. He says that regardless of what happens in the EU, DOJ, and class-action proceedings, Microsoft can't lose. Why? Because they make more money by paying lip-service to the law and accepting the occasional fine than by complying. He even does some simple math to prove his point. Fascinating stuff."
Judges should act quicker and allow for much less delay is anti-trust cases, because time plays against the ones they're trying to defend.
After 3 days without programming, life becomes meaningless
- The Tao of Programming
What whould you do if the parking ticket cost less than the parking meter?
To err is human. To arr is pirate.
Previously, the FCC was limited to fining $27,500 per offense - and Clear Channel, pulling in many millions a year syndicating Howard Stern, would gladly pay the small fine knowing that the 'controversy' only increased his ratings, resulting in even higher profits for them. When the FCC recently changed their fine structure to $275,000 per station per offense, that could result in many millions in fines each time... which is what resulted in Clear Channel dropping Stern from most of their stations.
In both this and the EU/Microsoft cases, small fines don't work, and large fines will either be appealled and reduced or attacked as being unreasonable. The only solutions that will actually change behavior are the ones that will cause serious economic harm, without seeming unreasonable - suspending licenses of non-complying stations, or forcing Microsoft to open code/APIs and unbundle apps (or even splitting up the different sections of the company.)
-T
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Erick
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"The forced open-sourcing of Windows is the way to go!"
I hope to God you are kidding. Not only would this be completely unfair, but it would also be an admission that Open Source cannot compete with MS.
If you think forcing MS to open source is fair, maybe you wouldn't mind if the state turned your lawn into a public park? Property is property.
Be happy. Nothing else matters.
Step 3 is: Make so much money that the fines just become a cost of doing business.
I seem to remember[1] this being a problem with the EPA laws years ago. The cost of disposing of waste legally was more expensive than dumping it illegally and paying the fine. It's a no brainer from a business point of view. As long as non-compliance makes them more money than compliance, even with the fines, guess which they're going to choose.
[1] this might be an instance of "creative memory" rather than actual fact, but the analogy still holds.
People's desire to believe they are right is much stronger than their desire to be right.
In other news, I wouldn't care about traffic fines if they only cost a quarter.
This reminds me of the scene in the movie, where Ed Norton's character explains that if it is cheaper for a company to pay fines, than to recall a potentially-deadly product, then they will opt for the former.
This is one rather unfortunate downside of capitalism; it only works when government has enough regulatory power to compell companies not to harm its citizens. Once a government is in the pockets of business, the citizens are in big trouble.
Tubal-Cain smokes the white owl.
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There is nothing to stop the EU from retrying them and upping the fine if they keep it up. That's like saying you should get life for your first parking ticket.
Did you actually RTFA? Cringley points out that even that won't matter. The justice system moves so slowly that by the time the new trial winds down and MS has to pay the fine, they'll have earned billions more than the fine costs them, even adding in interest from the original fine date. The EU's max fine isn't enough to even dent MS.I hate to say it (because I don't care for Microsoft's actions) but I'm afraid Cringley is right, MS will win no matter what as far as the courts and anti-trust goes. Ironically the biggest threat to them is possibly Wal-mart's new PCs coming with Sun's Java Desktop on them. What's so ironic about it is that Wal-mart is another example of a company so huge that it can just ignore compliance because it'll cost it less to pay the fines.
Instead, go out and elect a President who will appoint an Attorney General who thinks that anti-trust laws need penalities that actually hurt.
These two are mutually exclusive. Anyone who can get elected will have had their campaign financed by someone that this hurts. Anyone who hasn't had their campaign financed by someone that this hurts can't get elected.
People's desire to believe they are right is much stronger than their desire to be right.
Not only would this be completely unfair
You mean, like Microsoft's anti-competitive practices?
but it would also be an admission that Open Source cannot compete with MS.
It would be no such thing. Whether the source code to Windows is open has no bearing on how other open source products perform, except how they interact with Windows components. But closed source products would benefit the same way.
Property is property.
Intellectual property is NOT property.
People's desire to believe they are right is much stronger than their desire to be right.
What they needed in this, and many other anti-trust cases, is to think outside the box: why not use the RICO statutes? What not have the Federal Trade Commission declare Microsoft OS defective and pull it from shelves? Why not go after Bill and Steve like they did with Enron's Skilling and Lay?
Actually, Cringley peripherally touches on that question, too, by noting that Microsoft has a lot of political allies. It is, of course, a matter of popular wisdom that money buys legislation, but that's not strictly true. You are, for example, not ever going to cough up enough dough to get Tom DeLay to advocate for same-sex marriage or to get Teddy Kennedy to sponsor a bill in favor of racial segregation. All but a few of these people really are ideologically driven, and all the money buys you is wiggle room, which is significant for most politicians, but not all-consuming.
The real problem is that there is an ideological faction in Congress -- which is primarily but hardly exclusively Republican -- which sees business and making money as a good thing, and which naively reasons, therefore, that bigger business and more money must be a better thing. These ideologues are not (especially) corrupt or stupid, but they are blinded by their own dogma. The libertarian wing of the faction is particularly blinded by their adherence to the doctrine of a self-correcting market because they refuse to recognize that, all other things being equal, wealth is itself a competitive advantage.
This will not change except at the ballot box, and it will not ever be the primary issue: the average person doesn't care enough about this to choose a candidate on the basis of their feelings about Microsoft or antitrust laws.
Now, mind you, I'm not arguing against being politically active by any means, but the best way to fight Microsoft (and Oracle, Adobe, Macromedia, etc., etc., ad nauseam) is to write excellent free end-user software. Sure, it's still necessary to fend off the more ridiculous legislative initiatives and vote wisely, but in the end, making the better product will win out.
(Now, by "better", I mean better in the eyes of the average consumer, not the average software engineer, but that's a rant for another occasion.)
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