Antitrust Laws

Hermina Williams

Antitrust Claims

BUS670: Legal Environment

Professor Roger Little

August 5, 2011

Antitrust Claims

The anti-trust claims faced by Microsoft were that Microsoft abused its market power by bundling its operating system with its browser, and Internet Explorer with Microsoft Windows. The allegation was that this was an abuse of market power and skewed the competition in the internet browser market in favor of Microsoft. The point was that every user of Windows had a copy of Internet Explorer and so was urged to use it. Furthermore, it was alleged that Microsoft had manipulated the interface so that it would take longer to download other browsers like Netscape Navigator while using Microsoft Windows. The overall effect by Microsoft was to make Internet Explorer the most favored and used internet browser (Spinello R A 2003),

One purpose of anti-trust laws is to ensure that a firm does not compel a consumer to purchase another product bundled with another product. In other words, a seller should not be compelled by a monopolist to pay for and use another product also produced by the monopolist. This argument does not fully hold water, because in most cases Microsoft claimed that it did not charge extra for Internet Explorer. Giving a freebee and encouraging its use does not appear to be a misuse of monopoly power. Also in a capitalist economy a company cannot be compelled to provide facilities to use competitors' products! So, in my opinion if Microsoft Windows was slow in downloading and installing Netscape navigator or Opera, it was a legitimate action of competition and not an abuse of market power (Lawrence M.F, 1995). Furthermore, the contention of the prosecution was that Internet Explorer was not really free, and that the cost of Internet Explorer was embedded in the cost of purchasing Microsoft Windows. This claim had not been admitted by Microsoft and remains questionable. The allegations against Microsoft claim that...