A History of Microsoft's AntiCompetitive Behavior

[Cueil]

alephnull said:

Squilliam said:

alephnull said:

Squilliam said:

I think that generally where a company has market power they will act against the best interests of the consumer and attempt to derive a much higher producer surplus than they could get otherwise.

Under orthodox models, monopolists will price above the point where MC=MR as you say. However, you have to be the first I've encountered to say this is in the interest of consumers. Usually the argument from classical liberals is that monopolies are impossible to maintain for a significant period without state interference.

Its not as simple as classical liberals like to think. Some markets by their very nature are more efficiently organised in a monopolistic kind of way. Consider situations like Cable companies, power line companies, Cell phone providers where each for a variety of reasons find a natural equilibrium in a monopolistic state. In these situations the market is better provided for by a monopoly as long as the excessive economic rents taken by these companies are held in check.

 

I agree completely. Sorry, I am slightly taken aback by someone thinking for themselves instead of parroting someone else's ideas on a non-econ blog.

To make this argument (and I'm not saying it can't be made) you first need show why multiple producers would be less efficient. This is obvious with cable companies (you don't want 12 different companies constantly digging up your back yard laying cable) but less so with OS's. I will grant you that an OS is a natural monopoly, but in the particular case of this market there are obvious alternatives such as agreed upon, well documented standards (such as POSIX) which imho negate the usefulness of a monopoly OS.

If you think those alternatives sub-optimal, then you need to present the case for not heavily regulating/establishing a national trust for windows much like is the case for utility companies.

 

Microsoft didn't always have this magical monopoly... they created it by putting out a superior product... at least in the view of the mainstream user... Windows 95 blew open the PC market to a degree that I seriously doubt you would be on these forums... much less that these forums would exist as they do now.  Microsoft accelerated things to the next level.  They  had a very totalitarian look on things for a long time after that, but if you really think about it that was really a very short span of time from 95's release till they started turning things around in 2001 and 2002.  I think what really showed Microsoft how to win over customer loyalty was the Xbox side of the house... despite loosing tons of money they build up a very rabid fan base that they knew they could grow upon.  As for natural monopolies there are very few in the US... but Utility companies and Hospital(for the most part) are generally natural monopolies.  Eventually I think that Microsoft will make their IE browser open source... it's not like the hackers are slowing down trying to hack the damn thing as it is and I believe that eventually Windows will have open source... though I don't think it will be complete... I don't think they'll release the kernel, but it would be interesting to see what the Open Source community could do with free access to the UI and other functions.