I see that it was necessary to break up Bell into smaller companies,
Bell was a government-created and government-protected monopoly.
which are now re-combining like mad, because that way they can squeeze suppliers and the work-force and negotiate from a much stronger position than small independent contractors.
Be that as it may, they are also scrambling over each other to introduce new features and new products. Prices in the long-distance market have plummeted, and at least around here our Baby Bell has been introducing DSL at dirt cheap prices.
I remember the good old days of Big Blue. I remember that before the Asian cloners got going Intel were over-priced.
Be that as it may, the PC market has a number of big players, yet it is one of the most productive in the economy.
I note that once companies get to be large enough that it is a fraction of their income to lobby aggresively at Congress, contribute to the PACs, fund "think-tanks" etc., then they get to influence the legislation passed.
Exactly, which demonstrates that the threat is not Big Business, but Big Government. If the government were not in the habit of passing out subsidies and regulating everything in sight, it wouldn't be as much of an issue.
There were large numbers of other oil companies before the Standard Oil Trust, but they were subsumed.
Do you have evidence for this?
Re:Katz is onto something...
on
AOL Nation
·
· Score: 2
OK, someone has his head in the sand. First of all, TW does not own all the cable companies, or anywhere close to it. AT & T owns at least as many, and there are others as well. Secondly, the cable company monopoly is a government-imposed one anyway, and if the government got out of the way, there would likely be competition. Thirdly, there are other connection technologies, including DSL, ISDN, and various wireless alternatives, that compete with cable. And finally, 56k is not going to be banned, only superceded by better technology. In the event that AOL cornered the market we could continue using our 56k modems.
Just last month they were suing for "open access" to AT & T's lines. Those lines are still there, and odds are AOL will shut up about open access now that they have lines of their own. Get a grip: AOL is not Big Brother.
Re:Katz is onto something...
on
AOL Nation
·
· Score: 2
That's the joy of controlling the market, the consumer CAN'T go someplace else. Don't like CNN, try Headline News, oops same company, how about MSNBC,
Ummmm... MSNBC is a collaboration between Microsoft and NBC, which I believe is owned by GE.
doh!, how about FoxNews,
FoxNews is owned by Fox, I presume, which is owned by Rupert Murdoch. That's not TW. ABCNews is owned by Disney, which is also a different source. And you also have Reuters, AP, BBC, NPR, Drudge, Gannet, dozens of hometown papers, dozens of magazines, etc. TW is hardly in a position to control the news. Yes, TW owns a lot of media, but other companies own a much larger portion.
I think you also underestimate the awareness of the American people. The media loves a scandal, and they are particularly happy to report on the screw-ups of their competitors. There have been several instances of bad reporting and/or corporate pressure killing stories, and they have been thouroughly aired in competing media. In several cases, it forced the resignation of the people responsible.
So anyone who thinks that this merger is a threat to the free press is smoking crack. Perhaps it's a threat to the few people who are so stupid and lazy as to get all their news from a single source, but those people don't matter too much anyway.
These two things (Big business and competitive enterprise) are antithetical...
How do you figure? There are many markets dominated almost entirely by big businesses, and competitive enterprise is alive and well. Look at the telecom, computer, automotive, and fast food industries. All of them are dominated by Big Business, and all of them are highly competitive.
It is arguable (although I would disagree) that *some* Big Businesses are detrimental to free enterprise, but that doesn't make them always antithetical. The pertinent question is: is AOL damaging to the free enterprise system? I don't see how it is. There are a large number of competing ISP's, with various levels of service and of various sizes. I can't see AOL doing the free-market system any harm.
Re:One reason AOL is so hated - OK. two
on
AOL Nation
·
· Score: 2
I had a friend (an attorney with two children) who was a damn smart person, but knew diddly about technology and the Internet. He was paying $50-$70 per month so his kids could research school work on the Internet and he still had to regulate their usage of the net due to the cost. He had no idea he could get unlimited access for about $20 per month until I gave him a list of ISP's in his area.
I would be inclined to chalk this up more to AOL's general lack of foresight than to any malice on their part. The per-hour usage was the way this sort of thing was done back then, and very few people realized the potential of the internet to transform things. AOL provided a valuable service in those days, and the simple fact was that no one was ready to set newbies up to use a raw internet connection in those days. TCP/IP stacks were not built into consumer OS's, PPP required seperate packages, and the computers were a lot slower than they are now. Very few people knew people with the expertise to set up a real 'net connection.
AOL tried to compete with the internet and lost. What forced them to cut their rates was competition from more nimble competitors. It looks to me like this is a classic case of an extablished player seeing its business model destroyed by more nimble competitors. Capitalism at work, and not the fault of AOL or anyone else.
From the safety of the AOL citadel, they can do practically anything, (spam, insult, abuse) and it is up to the court of AOL to prosecute them or not, usually not.?
I'm not sure what you're referring to here. AOL customers have a very important option: they can go to a different ISP. The fact that so many of them choose to stay with AOL tells you they can't be abusing their customers too much.
The rest of us won't be affected much at all. I can't get information about AOL users, but the same is true of other ISP's. What do you want?
Katz is right, the spectre of a stock with more power than any world government, or even all world governments, is solidifying, and those friendly happy AOL users ("all my friends are on AOL") do not realize it, but facilitate it.
Money is not equivalent to political power. AOL cannot pass new laws about you. They can't impose taxes. In fact, as long as you're not a customer, there's not a thing they can do to you. And there are still gobs of ISP's out there, so it's not like they are a monopoly.
Re:Just say no to anti-trust
on
AOL Nation
·
· Score: 1
And this is relevant why? Any AOL user is free to switch to another ISP at any time. There are several that offer the kind of no-brainer service that AOL provides, and most people know at least one geek who can help set up a real internet connection. If people are so stupid or helpless that they can't figure out how to switch ISP's, that's their fault.
Re:Just say no to anti-trust
on
AOL Nation
·
· Score: 2
They dumped hordes of clueless newbies onto the net, sucking up countless hours of time from admins and moderators all over the place
So you're saying, what, that newbies shouldn't be on the net? How would they have done it any differently?
Besides, those "clueless newbies" are the folks that every e-commerce site on the net is trying to attract. There are a hell of a lot more of them than there are of us. The net would be a much smaller and less interesting place if those "clueless newbies" were not able to get online.
and not paying a penny for all that trouble.
AOL doesn't pay for its bandwidth?
Re:Just say no to anti-trust
on
AOL Nation
·
· Score: 2
Because, it's the gut feeling of geeks everywhere that traditional broadcast media (time warner) should not be able to purchase one of their largest competitors, simply because it will narrow consumer choice.
Well, here's one geek who thinks no such thing. There are a lot of broadcast companies out there, and even more ISP's and online news sources. I don't see consumers being hurt by this, and there's a good think that the new company will come up with new ways of integrating various media for a better user experience. This probably won't excite hard-core geeks, but there are a lot of people out there who won't touch a computer until it's as easy to use as a toaster. AOL/TW could help make that happen.
Even if nothing else comes of this, this may be a big win for AOL's customers, as AOL will suddenly have a vast news-gathering and entertainment organization at their disposal.
And in any event, since when is "the gut feeling of geeks" the determining factor in corporate mergers?
Re:Just say no to anti-trust
on
AOL Nation
·
· Score: 2
mergers will stop when enough people have been fired after mergers to create real pressure groups to stop the madness. Imagine a situation where twenty percent of the working population become jobless as a result of mergers and start calling their congressmen
You are ignoring supply and demand. If 20% of the population were unemployed, wages would drop and other companies would hire them. The fact is that most companies are hiring, and for every merger that eliminates jobs, there are other companies hiring everyone in sight. Don't expect any riots any time soon.
Re:Furthermore, here is exactly WHY you are wrong:
on
AOL Nation
·
· Score: 1
If the American people are so stupid as to get all their news from one source, and not even think about it critically, I'd say we have much bigger problems on our hands than the AOL merger. And I don't see what this has to do with the merger anyway. TW already has ownership of CNN and several cable companies. AOL doesn't own any cable companies. If people are already getting their news exclusively from CNN, what is adding AOL to the picture going to accomplish?
Simple, once the competitor is removed, you can charge what you like and do what you like. It wouldn't be illegal if it wasn't a well-established monopoly practise.
There were a couple of threads about this in an Intel-vs-AMD story a while ago, and there were several reasons that this is not possible. The question is: could Megacorp destroy Tinycorp by selling its chips at a loss until Tinycorp went out of business? There are several reasons the answer is no:
Market share. Megacorp has a lot more of it, which means that they will lose money faster than Tinycorp.
Supply and demand. If you lower the price of something, the quantity demanded goes up. That means that not only are you selling chips at a loss, but you are selling a lot *more* chips at a loss than you otherwise would.
Other production: Meanwhile, Tinycorp can keep its prices at its break-even point, and lie low while Megacorp runs out of money. In many cases, they can even shift their resources to other markets. They know that Megacorp needs to recoup those losses through higher prices, and all they have to do is wait for prices to increase again.
Speculators. Megacorp also has to worry about people buying up their product and saving it in a warehouse for prices to go back up. This not only means that they are going to have to sell more than ever, but they will then be unable to raise prices much when it's over.
Capital markets. Even if Megacorp does everything else right, Tinycorp can probably still go to the capital market and raise the money to keep fighting. After all, if Megacorp fails to knock Tinycorp out of the market, that will give it a strong position after Megacorp gives up. This is particularly true if Megacorp is trying to destroy several companies at once. Some of them might drop out, but others will stay in business and will be able to pick up the customers that the losers lost. Thus their position is valuable.
I believe Standard oil actually tried this tactic on its competitors and failed. The antitrust action against them happened after they had already lost their total grip on the oil industry to upstart competitors. This is how antitrust law generally works: it protects mediocre companies from their more able competitors.
But if Windows was not a monopoly, then how is this a violation of antitrust? If Windows didn't have a monopoly, then how is it illegal for them to use that product to promote another one, even if they have a monopoly in the other product? That doesn't make any sense.
In order to destroy the market for DR-DOS, microsoft inserted an extra piece of code to detect DR-DOS and tell users that Windows was not compatible. In fact, Windows was compatible, microsoft's software lied to the enduser.
No, this code never made it to the end user. It was in the beta version, and even there it didn't specifically say that it was incompatible, but only gave a vague, and non-fatal error.
Caldera dropped it because they had no case and they knew it. The alleged incompatibility was only in beta versions of the software, and in any event, I don't see that Microsoft has an obligation not to make Windows and DOS incompatible.
Microsoft's Windows monopoly status isn't at issue here.
If they didn't have monopoly status, then how is what they did illegal? Simply making a product that is incompatible with a competitor (even deliberately so) is not illegal under any law I know of.
However, they did have a monopoly on the DOS market of the time, and it was DR-DOS that Microsoft was trying to kill (a competitor) using their monopoly power.
But the allegation is not that they used their DOS monopoly to promote Windows, sine that would have been nonsensical. The allegation is that they used their Windows monopoly to promote DOS. And it is far from clear they had a Windows monopoly at the time.
All large companies that have a product that no one else makes, does the same thing. And they are also sued under anti-trust law, just like Microsoft was.
That's my point. In 1991, there were at least two companies that produced competing products, probably more. Apple and OS/2 were both viable competitors, and probably NeXT as well. And there are lots of companies that do this sort of thing and don't get sued. Pepsi and Pizza Hut are both owned by the same company, and the only drinks you can buy at Pizza Hut are made by Pepsi.
Second, it is wrong to do something just because it destroys competition.
I think you are drawing a meaningless distiction. All companies try to destroy their compeition. That's how competition works. Coke and Pepsi try to drive each other out of the market constantly. Same with BK and McDonalds. What is the difference between "destroying the competition" and "competing?"
Normally, companies will do this by selling their product at a loss until the competitor is forced out of business.
This is indeed illegal, but I've yet to hear a compelling economic justification for it. It is all but impossible to profit using this method.
However, I soon decide that you are not needed. I can the size of my widget, and tell the company that they either modify their product, or loss the contract. Well, volume of widgets that you produce is not enough to keep them in business, while I can produce enough widgets to meet their need.
Trouble is, there isn't just one customer that has to choose between us. There are hundreds of thousands of customers, and what will happen is that some of them will choose DOS, and some will choose DR-DOS. Your analogy doesn't fit.
If I remember correctly, the definition of ex post facto has to do with the enforcement of newly written laws, not with enforcing existing laws.
You're right. If Caldera is arguing that MS was a monopoly in '91, knew it, and did this anyway, then that would not be ex post facto law and would not be unconstituional. But if they are simply using the fact that Microsoft is now a monopoly to punish actions that occured before the monopoly status existed, then that is ex post facto, since there is no way Microsoft could have known whether their market share would continue to increase.
The question, then, is was Microsoft a monopoly in 1991? If you went back to 1991 and asked 10 antitrust lawyers if Microsoft is a monopoly under the Sherman Act, I'd bet you'd get at least 8 "no"'s. The simple fact that they have a larger market share than anyone else certainly doesn't make them a monopoly, since every industry has a market leader. As I said elsewhere, I'd be curious to see some numbers. Apple and OS/2 were both viable competition back then. I have a feeling, though, that the Windows market share was substantially less than it is today, and given how controversial Microsoft's monopoly ruling is today, it's even harder to make that case 10 years ago.
Yeah. Right. I'll believe that when pigs fly. They had desktop OS dominance, they had Win-based office suite dominance, and FUD down ta an art form. Once M$ got the market in anything it never let go.
I'd be interested to see some market share numbers. From what I've read, Windows wasn't a particularly useful product until version 3, and the OS/2 versus Windows war was still going on or just finishing when Windows 3 was released. They may have had a majority of the market, but their market share was not as large as it is now. If they were a monopoly in '91, why did it take the DOJ until '98 to do anything about it, and concerning a case that occured in '96?
I hate to go karma whoring here, but how is my post flamebait? With the possible exception of calling Caldera "vultures," I don't see anything in my post that's the least bit inflamatory.
Everything in the post is level-headed and backed up with arguments. Moderators, please try to keep straight the difference between expressing an unpopular opinion and expressing an opinion in an inflamatory manner. The fact that you disagree with my post doesn't make it flamebait.
I think this points to a general bias in the/. community. I've seen posts several times as inflamatory as this one marked up to 3 for being "insightful." Yet I post a relatively tame defense of Microsoft, and I'm guilty of flamebaiting. Believing that Microsoft is innocent is not such a shocking opinion to justify censorship.
Second, Microsoft is a monopoly. Since they own the market for Windows, excluding a competitor would do serious damage to that competior.
That was one of my points: Microsoft may be the clear market leader today, but in 1991 or whenever this actually occurred, that status was still very much in dispute. To retroactively assign Microsoft the status of a monopoly 10 years after the fact is ex post facto law, which is prohibited by the Constitution.
If they were to do the same thing now, you'd at least have antitrust laws on your side. But 10 years ago, I don't see antitrust laws as applicable, since they had not yet consolidated their "monopoly" position.
Both OS2 and Apple were viable competition, and as I said either of them could have beaten Microsoft if they hadn't screwed up so badly. Apple at that time had the undisputed best GUI, and a kick-ass line of machines. If they hadn't charged so much for them, gone after business more forcefully, and not gone off on all kinds of tangents like the Newton project, they would be in a much better position today. Similarly if IBM hadn't been so smug and arrogant about their control of the direction of the PC market, they probably would have done better with OS/2, and it might still be viable today.
So to expect Microsoft to say "Gee, we might be a monopoly 5 years from now, we'd better not engage in anti-competitive practices" is simply not reasonable."
Note that Apple has done things that are at least as bad. Look at the way they killed the clones. They took a thriving market for Mac compatible computers and killed it simply because it was eating into their market share. Apple has a monopoly on Mac-compatible computers. Should Motorolla and Power Computing sue them?
...that Microsoft didn't have the guts to stand up for itself. I don't blame them, given how unfairly they've been treated in other cases, but I see no reason Microsoft should pay a cent to these vultures.
Consider the implications of this lawsuit. It alleges that Microsoft is guilty of producing a product that is compatible with one of its other products, and incompatible with a competing product. How is that a crime? It happens all the time, and when anyone other than Microsoft does it, no one even notices. But apperantly, now that Microsoft has been declared a "monopoly," it has to play by an entirely different set of rules.
At the very least, this strikes me as retroactive law, something I thought was outlawed by the Constitution. Microsoft in the early 90's was not aware it was a "monopoly," and in fact it was far from clear that they would be able to maintain their dominance in the market, much less expand it. They were still going at it with both Apple and OS/2, and either of them could easily have beaten MS if they had played their cards right. To punish MS for being a monopoly at a time when it was not generally agreed that it was a monopoly is ludicrous.
Even if they are a monopoly, I don't see how the above can be considered a crime. If I write a piece of software and I've only tested it in Windows, it might be perfectly reasonable for me to only allow it to run under Windows, to ensure that the users get a consistent experience. If someone comes out with a Windows variant, I don't see any obligation on my part to support that variant, and in fact, if I haven't tested it on that variant, it might be reasonable for me to refuse to allow it to run on that variant to make sure there are no unnecessary bugs. This logic doesn't change when the company concerned is Microsoft.
I'm not familiar with the details of the case, but I don't see any way Microsoft's actions could be considered illegal. I'm not even sure there's anything unethical about refusing to make one's product compatible with that of a competitor, whether one has a "monopoly" or not.
Slashdot Mirror
I see that it was necessary to break up Bell into smaller companies,
Bell was a government-created and government-protected monopoly.
which are now re-combining like mad, because that way they can squeeze suppliers and the work-force and negotiate from a much stronger position than small independent contractors.
Be that as it may, they are also scrambling over each other to introduce new features and new products. Prices in the long-distance market have plummeted, and at least around here our Baby Bell has been introducing DSL at dirt cheap prices.
I remember the good old days of Big Blue. I remember that before the Asian cloners got going Intel were over-priced.
Be that as it may, the PC market has a number of big players, yet it is one of the most productive in the economy.
I note that once companies get to be large enough that it is a fraction of their income to lobby aggresively at Congress, contribute to the PACs, fund "think-tanks" etc., then they get to influence the legislation passed.
Exactly, which demonstrates that the threat is not Big Business, but Big Government. If the government were not in the habit of passing out subsidies and regulating everything in sight, it wouldn't be as much of an issue.
There were large numbers of other oil companies before the Standard Oil Trust, but they were subsumed.
Do you have evidence for this?
OK, someone has his head in the sand. First of all, TW does not own all the cable companies, or anywhere close to it. AT & T owns at least as many, and there are others as well. Secondly, the cable company monopoly is a government-imposed one anyway, and if the government got out of the way, there would likely be competition. Thirdly, there are other connection technologies, including DSL, ISDN, and various wireless alternatives, that compete with cable. And finally, 56k is not going to be banned, only superceded by better technology. In the event that AOL cornered the market we could continue using our 56k modems.
Just last month they were suing for "open access" to AT & T's lines. Those lines are still there, and odds are AOL will shut up about open access now that they have lines of their own. Get a grip: AOL is not Big Brother.
That's the joy of controlling the market, the consumer CAN'T go someplace else. Don't like CNN, try Headline News, oops same company, how about MSNBC,
Ummmm... MSNBC is a collaboration between Microsoft and NBC, which I believe is owned by GE.
doh!, how about FoxNews,
FoxNews is owned by Fox, I presume, which is owned by Rupert Murdoch. That's not TW. ABCNews is owned by Disney, which is also a different source. And you also have Reuters, AP, BBC, NPR, Drudge, Gannet, dozens of hometown papers, dozens of magazines, etc. TW is hardly in a position to control the news. Yes, TW owns a lot of media, but other companies own a much larger portion.
I think you also underestimate the awareness of the American people. The media loves a scandal, and they are particularly happy to report on the screw-ups of their competitors. There have been several instances of bad reporting and/or corporate pressure killing stories, and they have been thouroughly aired in competing media. In several cases, it forced the resignation of the people responsible.
So anyone who thinks that this merger is a threat to the free press is smoking crack. Perhaps it's a threat to the few people who are so stupid and lazy as to get all their news from a single source, but those people don't matter too much anyway.
These two things (Big business and competitive enterprise) are antithetical...
How do you figure? There are many markets dominated almost entirely by big businesses, and competitive enterprise is alive and well. Look at the telecom, computer, automotive, and fast food industries. All of them are dominated by Big Business, and all of them are highly competitive.
It is arguable (although I would disagree) that *some* Big Businesses are detrimental to free enterprise, but that doesn't make them always antithetical. The pertinent question is: is AOL damaging to the free enterprise system? I don't see how it is. There are a large number of competing ISP's, with various levels of service and of various sizes. I can't see AOL doing the free-market system any harm.
I had a friend (an attorney with two children) who was a damn smart person, but knew diddly about technology and the Internet. He was paying $50-$70 per month so his kids could research school work on the Internet and he still had to regulate their usage of the net due to the cost. He had no idea he could get unlimited access for about $20 per month until I gave him a list of ISP's in his area.
I would be inclined to chalk this up more to AOL's general lack of foresight than to any malice on their part. The per-hour usage was the way this sort of thing was done back then, and very few people realized the potential of the internet to transform things. AOL provided a valuable service in those days, and the simple fact was that no one was ready to set newbies up to use a raw internet connection in those days. TCP/IP stacks were not built into consumer OS's, PPP required seperate packages, and the computers were a lot slower than they are now. Very few people knew people with the expertise to set up a real 'net connection.
AOL tried to compete with the internet and lost. What forced them to cut their rates was competition from more nimble competitors. It looks to me like this is a classic case of an extablished player seeing its business model destroyed by more nimble competitors. Capitalism at work, and not the fault of AOL or anyone else.
From the safety of the AOL citadel, they can do practically anything, (spam, insult, abuse) and it is up to the court of AOL to prosecute them or not, usually not.?
I'm not sure what you're referring to here. AOL customers have a very important option: they can go to a different ISP. The fact that so many of them choose to stay with AOL tells you they can't be abusing their customers too much.
The rest of us won't be affected much at all. I can't get information about AOL users, but the same is true of other ISP's. What do you want?
Katz is right, the spectre of a stock with more power than any world government, or even all world governments, is solidifying, and those friendly happy AOL users ("all my friends are on AOL") do not realize it, but facilitate it.
Money is not equivalent to political power. AOL cannot pass new laws about you. They can't impose taxes. In fact, as long as you're not a customer, there's not a thing they can do to you. And there are still gobs of ISP's out there, so it's not like they are a monopoly.
And this is relevant why? Any AOL user is free to switch to another ISP at any time. There are several that offer the kind of no-brainer service that AOL provides, and most people know at least one geek who can help set up a real internet connection. If people are so stupid or helpless that they can't figure out how to switch ISP's, that's their fault.
They dumped hordes of clueless newbies onto the net, sucking up countless hours of time from admins and moderators all over the place
So you're saying, what, that newbies shouldn't be on the net? How would they have done it any differently?
Besides, those "clueless newbies" are the folks that every e-commerce site on the net is trying to attract. There are a hell of a lot more of them than there are of us. The net would be a much smaller and less interesting place if those "clueless newbies" were not able to get online.
and not paying a penny for all that trouble.
AOL doesn't pay for its bandwidth?
Because, it's the gut feeling of geeks everywhere that traditional broadcast media (time warner) should not be able to purchase one of their largest competitors, simply because it will narrow consumer choice.
Well, here's one geek who thinks no such thing. There are a lot of broadcast companies out there, and even more ISP's and online news sources. I don't see consumers being hurt by this, and there's a good think that the new company will come up with new ways of integrating various media for a better user experience. This probably won't excite hard-core geeks, but there are a lot of people out there who won't touch a computer until it's as easy to use as a toaster. AOL/TW could help make that happen.
Even if nothing else comes of this, this may be a big win for AOL's customers, as AOL will suddenly have a vast news-gathering and entertainment organization at their disposal.
And in any event, since when is "the gut feeling of geeks" the determining factor in corporate mergers?
mergers will stop when enough people have been fired after mergers to create real pressure groups to stop the madness. Imagine a situation where twenty percent of the working population become jobless as a result of mergers and start calling their congressmen
You are ignoring supply and demand. If 20% of the population were unemployed, wages would drop and other companies would hire them. The fact is that most companies are hiring, and for every merger that eliminates jobs, there are other companies hiring everyone in sight. Don't expect any riots any time soon.
If the American people are so stupid as to get all their news from one source, and not even think about it critically, I'd say we have much bigger problems on our hands than the AOL merger. And I don't see what this has to do with the merger anyway. TW already has ownership of CNN and several cable companies. AOL doesn't own any cable companies. If people are already getting their news exclusively from CNN, what is adding AOL to the picture going to accomplish?
There were a couple of threads about this in an Intel-vs-AMD story a while ago, and there were several reasons that this is not possible. The question is: could Megacorp destroy Tinycorp by selling its chips at a loss until Tinycorp went out of business? There are several reasons the answer is no:
Market share. Megacorp has a lot more of it, which means that they will lose money faster than Tinycorp.
Supply and demand. If you lower the price of something, the quantity demanded goes up. That means that not only are you selling chips at a loss, but you are selling a lot *more* chips at a loss than you otherwise would.
Other production: Meanwhile, Tinycorp can keep its prices at its break-even point, and lie low while Megacorp runs out of money. In many cases, they can even shift their resources to other markets. They know that Megacorp needs to recoup those losses through higher prices, and all they have to do is wait for prices to increase again.
Speculators. Megacorp also has to worry about people buying up their product and saving it in a warehouse for prices to go back up. This not only means that they are going to have to sell more than ever, but they will then be unable to raise prices much when it's over.
Capital markets. Even if Megacorp does everything else right, Tinycorp can probably still go to the capital market and raise the money to keep fighting. After all, if Megacorp fails to knock Tinycorp out of the market, that will give it a strong position after Megacorp gives up. This is particularly true if Megacorp is trying to destroy several companies at once. Some of them might drop out, but others will stay in business and will be able to pick up the customers that the losers lost. Thus their position is valuable.
I believe Standard oil actually tried this tactic on its competitors and failed. The antitrust action against them happened after they had already lost their total grip on the oil industry to upstart competitors. This is how antitrust law generally works: it protects mediocre companies from their more able competitors.
But if Windows was not a monopoly, then how is this a violation of antitrust? If Windows didn't have a monopoly, then how is it illegal for them to use that product to promote another one, even if they have a monopoly in the other product? That doesn't make any sense.
If DR-DOS was so weak that pre-release bad publicity can kill it that easily, was it really that great of a program to start with?
In order to destroy the market for DR-DOS, microsoft inserted an extra piece of code to detect DR-DOS and tell users that Windows was not compatible. In fact, Windows was compatible, microsoft's software lied to the enduser.
No, this code never made it to the end user. It was in the beta version, and even there it didn't specifically say that it was incompatible, but only gave a vague, and non-fatal error.
Caldera dropped it because they had no case and they knew it. The alleged incompatibility was only in beta versions of the software, and in any event, I don't see that Microsoft has an obligation not to make Windows and DOS incompatible.
And you should have read the fact that this alleged code was never in the release version of Windows, buddy.
Microsoft's Windows monopoly status isn't at issue here.
If they didn't have monopoly status, then how is what they did illegal? Simply making a product that is incompatible with a competitor (even deliberately so) is not illegal under any law I know of.
However, they did have a monopoly on the DOS market of the time, and it was DR-DOS that Microsoft was trying to kill (a competitor) using their monopoly power.
But the allegation is not that they used their DOS monopoly to promote Windows, sine that would have been nonsensical. The allegation is that they used their Windows monopoly to promote DOS. And it is far from clear they had a Windows monopoly at the time.
All large companies that have a product that no one else makes, does the same thing. And they are also sued under anti-trust law, just like Microsoft was.
That's my point. In 1991, there were at least two companies that produced competing products, probably more. Apple and OS/2 were both viable competitors, and probably NeXT as well. And there are lots of companies that do this sort of thing and don't get sued. Pepsi and Pizza Hut are both owned by the same company, and the only drinks you can buy at Pizza Hut are made by Pepsi.
Second, it is wrong to do something just because it destroys competition.
I think you are drawing a meaningless distiction. All companies try to destroy their compeition. That's how competition works. Coke and Pepsi try to drive each other out of the market constantly. Same with BK and McDonalds. What is the difference between "destroying the competition" and "competing?"
Normally, companies will do this by selling their product at a loss until the competitor is forced out of business.
This is indeed illegal, but I've yet to hear a compelling economic justification for it. It is all but impossible to profit using this method.
However, I soon decide that you are not needed. I can the size of my widget, and tell the company that they either modify their product, or loss the contract. Well, volume of widgets that you produce is not enough to keep them in business, while I can produce enough widgets to meet their need.
Trouble is, there isn't just one customer that has to choose between us. There are hundreds of thousands of customers, and what will happen is that some of them will choose DOS, and some will choose DR-DOS. Your analogy doesn't fit.
Moderation is really getting out of hand. Where would that post be more on topic?
If I remember correctly, the definition of ex post facto has to do with the enforcement of newly written laws, not with enforcing existing laws.
You're right. If Caldera is arguing that MS was a monopoly in '91, knew it, and did this anyway, then that would not be ex post facto law and would not be unconstituional. But if they are simply using the fact that Microsoft is now a monopoly to punish actions that occured before the monopoly status existed, then that is ex post facto, since there is no way Microsoft could have known whether their market share would continue to increase.
The question, then, is was Microsoft a monopoly in 1991? If you went back to 1991 and asked 10 antitrust lawyers if Microsoft is a monopoly under the Sherman Act, I'd bet you'd get at least 8 "no"'s. The simple fact that they have a larger market share than anyone else certainly doesn't make them a monopoly, since every industry has a market leader. As I said elsewhere, I'd be curious to see some numbers. Apple and OS/2 were both viable competition back then. I have a feeling, though, that the Windows market share was substantially less than it is today, and given how controversial Microsoft's monopoly ruling is today, it's even harder to make that case 10 years ago.
Yeah. Right. I'll believe that when pigs fly. They had desktop OS dominance, they had Win-based office suite dominance, and FUD down ta an art form. Once M$ got the market in anything it never let go.
I'd be interested to see some market share numbers. From what I've read, Windows wasn't a particularly useful product until version 3, and the OS/2 versus Windows war was still going on or just finishing when Windows 3 was released. They may have had a majority of the market, but their market share was not as large as it is now. If they were a monopoly in '91, why did it take the DOJ until '98 to do anything about it, and concerning a case that occured in '96?
I hate to go karma whoring here, but how is my post flamebait? With the possible exception of calling Caldera "vultures," I don't see anything in my post that's the least bit inflamatory.
/. community. I've seen posts several times as inflamatory as this one marked up to 3 for being "insightful." Yet I post a relatively tame defense of Microsoft, and I'm guilty of flamebaiting. Believing that Microsoft is innocent is not such a shocking opinion to justify censorship.
Everything in the post is level-headed and backed up with arguments. Moderators, please try to keep straight the difference between expressing an unpopular opinion and expressing an opinion in an inflamatory manner. The fact that you disagree with my post doesn't make it flamebait.
I think this points to a general bias in the
Second, Microsoft is a monopoly. Since they own the market for Windows, excluding a competitor would do serious damage to that competior.
That was one of my points: Microsoft may be the clear market leader today, but in 1991 or whenever this actually occurred, that status was still very much in dispute. To retroactively assign Microsoft the status of a monopoly 10 years after the fact is ex post facto law, which is prohibited by the Constitution.
If they were to do the same thing now, you'd at least have antitrust laws on your side. But 10 years ago, I don't see antitrust laws as applicable, since they had not yet consolidated their "monopoly" position.
Both OS2 and Apple were viable competition, and as I said either of them could have beaten Microsoft if they hadn't screwed up so badly. Apple at that time had the undisputed best GUI, and a kick-ass line of machines. If they hadn't charged so much for them, gone after business more forcefully, and not gone off on all kinds of tangents like the Newton project, they would be in a much better position today. Similarly if IBM hadn't been so smug and arrogant about their control of the direction of the PC market, they probably would have done better with OS/2, and it might still be viable today.
So to expect Microsoft to say "Gee, we might be a monopoly 5 years from now, we'd better not engage in anti-competitive practices" is simply not reasonable."
Note that Apple has done things that are at least as bad. Look at the way they killed the clones. They took a thriving market for Mac compatible computers and killed it simply because it was eating into their market share. Apple has a monopoly on Mac-compatible computers. Should Motorolla and Power Computing sue them?
...that Microsoft didn't have the guts to stand up for itself. I don't blame them, given how unfairly they've been treated in other cases, but I see no reason Microsoft should pay a cent to these vultures.
Consider the implications of this lawsuit. It alleges that Microsoft is guilty of producing a product that is compatible with one of its other products, and incompatible with a competing product. How is that a crime? It happens all the time, and when anyone other than Microsoft does it, no one even notices. But apperantly, now that Microsoft has been declared a "monopoly," it has to play by an entirely different set of rules.
At the very least, this strikes me as retroactive law, something I thought was outlawed by the Constitution. Microsoft in the early 90's was not aware it was a "monopoly," and in fact it was far from clear that they would be able to maintain their dominance in the market, much less expand it. They were still going at it with both Apple and OS/2, and either of them could easily have beaten MS if they had played their cards right. To punish MS for being a monopoly at a time when it was not generally agreed that it was a monopoly is ludicrous.
Even if they are a monopoly, I don't see how the above can be considered a crime. If I write a piece of software and I've only tested it in Windows, it might be perfectly reasonable for me to only allow it to run under Windows, to ensure that the users get a consistent experience. If someone comes out with a Windows variant, I don't see any obligation on my part to support that variant, and in fact, if I haven't tested it on that variant, it might be reasonable for me to refuse to allow it to run on that variant to make sure there are no unnecessary bugs. This logic doesn't change when the company concerned is Microsoft.
I'm not familiar with the details of the case, but I don't see any way Microsoft's actions could be considered illegal. I'm not even sure there's anything unethical about refusing to make one's product compatible with that of a competitor, whether one has a "monopoly" or not.