Legal and Economic Analysis of a Transatlantic Antitrust Case
New Horizons in Competition Law and Economics series
Edited by Luca Rubini
Chapter 6: The Microsoft Chronicles
Rudolph J.R. Peritz INTRODUCTION If there is a twentieth century icon, if there is a symbol for the information economy in the United States, it is Bill Gates and his Microsoft Corporation – a symbol for the best and worst of that century’s economic transformation into a networked domain of knowledge bases and communication protocols. At best Bill Gates symbolized the possibility of success beyond the wildest dreams of a software geek, a college drop-out who left Harvard and went home to the buzz culture of Seattle with its coffee bars, its software garages, and its grunge rock cellars. Everyone, it seemed, wanted to be like Bill. Again, in its best light, Microsoft developed a software platform that helped lift personal computing into a worldwide technology for the information economy. But there was the dark side: At its worst, Microsoft abused the power of its Windows monopoly in a succession of predatory excesses not seen since the heyday of John D. Rockefeller and his Standard Oil Company. Both Rockefeller and Gates created networks for national distribution, one the first physical network for nationwide petroleum transport and the other the first virtual network of worldwide software standards for PCs. And, according to the Justice Departments and federal courts of their eras, both violated the antitrust laws to gain and maintain the dominance of those networks. But similar means did not lead to similar ends. Standard Oil was broken up into 33 companies; Microsoft remains intact. Why was Microsoft not broken up into...
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