I think the result that Microsoft's operating systems continue to be very popular with OEMs (computer makers) and their customers has to do with the technology that was offered in those operating systems. The government's role was to make sure that the marketplace environment provided adequate opportunity for competition.īut Microsoft still dominates the OS market. Neukom: I think the government thought its job was to try to ensure there was a market for the licensing of desktop operating systems going forward. : What was the thinking at the time the 1994 accord was reached? These are advantages that come directly from misuse of its market power versus superior products-something addressed directly by U.S. Product tying, technological tying, predatory pricing, are all practices it continues to use around the world to gain unfair advantages in new markets. Many of the issues raised in the original DOJ lawsuit are the exact same issues that have been antitrust problems in recent years for Microsoft, both in this country and abroad-the same issues, but involving different products and different markets. How many of the current complaints against Microsoft can be traced back to either the wording of that consent decree, its limits or the issues raised by it? Even after paying fines for noncompliance, it has made more profit over time by not complying with antitrust laws than by complying. It in fact is quite shrewd in this regard. Microsoft keeps moving faster than government regulators. Has Microsoft, to this point, complied with the order? The agreement also limited Microsoft from engaging PC makers in contracts that lasted more than a year, and it demanded that the company not make contracts or pricing contingent upon acquiring any other product. Specifically, Microsoft agreed to do away with a number of practices, including a system in which manufacturers got a discount on copies of Microsoft's operating systems by paying for a license for every computer they shipped-whether or not it included a Microsoft OS. The 1994 accord, signed 10 years ago this month, focused on the way Microsoft worded contracts with computer makers. Though much less well-known than the broader Sherman Act case later brought by the Department of Justice, this initial action established a legacy of treating Microsoft as a company whose monopoly power needed to be kept in check. In the summer of 1994, with the threat of an antitrust charge looming, Microsoft agreed to settle charges that it was engaged in predatory business practices in its dealings with computer makers.
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