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Free «Antitrust Claims» Essay Sample

Since the beginning of the new millennium, the Microsoft Corporation has become the major target of antitrust claims and court proceedings. Over the past decade, Microsoft has gone thick and thin in its attempt to revitalize its market power and preserve its public image. The case of the United States v. Microsoft can be considered as landmark in the evolution of the American antitrust law. According to Economides (2001), Microsoft was sued for (1) having monopolized the operating systems market; (2) trying to monopolize the Internet browsers market; (3) having bundled its Internet Explorer browser with Windows; and (4) having developed exclusionary and anti-competitive agreements with service providers and computer manufacturers. Definitely, a company that violates the basic standards of free market competition must be ready to face the legal and social consequences of its illegal actions. In case of Microsoft, the company will have to take a sequence of steps to avoid further monopolization of the operations systems market. Unfortunately, these actions have little corrective value and will hardly reduce future anti-competitive threats. The best way to withstand the pressure of monopolization and unfair competition is to pursue the line of antitrust ethics proposed by Hemphill (2004).

The facts of the United States v. Microsoft case suggest that the Microsoft Corporation had been extremely bold in its striving to outperform real and potential competitors. The history of the case against Microsoft dates back to the end of the 1990s, when the company launched its Windows’98 operating system that was bundled with the browser, Internet Explorer (First & Gavil, 2006). As a result, the company used its strong market position to create a monopoly in the internet browsers market. Simultaneously, the company was found to have developed anti-competitive agreements with computer manufacturers and Internet service providers, which would not allow other manufacturers and providers to achieve any considerable profits or expand their presence in the market (Economides, 2001).

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Despite its relevance and importance, the case of the United States v. Microsoft raises too many questions. On the other hand, the case has become a culmination in a series of violations initiated by Microsoft in its striving to secure a monopolistic position in the software market; those violations eventually resulted in harm to equality, competition and antitrust injury to other renowned software and hardware companies (Weil & McMillan, 2003). On the other hand, and this is also my opinion, the case has proved the overall weakness of the antitrust law and its failure to prevent the development of large monopolies of any kind. The mere presence of the Microsoft monopoly in the U.S. and international market suggests that the current state of antitrust law cannot stop companies from becoming monopolists. More importantly, the penalties imposed on Microsoft imply that (a) the Microsoft case is more political than economic; and (b) the case will have little corrective value for other existing and future organizations (First & Gavil, 2006). The case has become a good lesson for Microsoft, but whether it is a good lesson for other companies is still a big question. The Microsoft case is just another example of the “long tradition of viewing antitrust as an act of political economy, intended to promote the public interest by opposing – and attempting to disperse – concentrated private economic power” (First & Gavil, 2006, p.683). The case explicitly shows that the state is becoming much weaker in its striving to dissolve the growing concentration of the economic power in the hands of monopolists.

What I think is that the entire case has much more to do with ethics than the economics and politics of monopolistic competition. As mentioned previously, laws can do little to minimize the risks of economic power concentration in the hands of a few giants, such as Microsoft. The nature of economic behaviors stems from the ethical values and principles pursued by large and small corporations. Only ethical behaviors in business, not antitrust law, do have the potential to guide today’s corporations towards equality, openness, fairness, and integrity in their relations with rivals (Hemphill, 2004).

   

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