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Anti Trust case on Microsoft Company

Anti Trust case on Microsoft Company

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Introduction

Microsoft Company was founded in the year 1975 by Bill gates and Paul Allen, when

they entered into a joint venture. The company started by creation of many prototypes, which

enabled it to simulate its systems quickly. Bavasso (38) asserts that Microsoft Company has

advanced in the supplying and development of many types of software. It was investigated for

antitrust behavior because of its tendency to abuse its market leadership in the software industry.

In fact, the legal system investigated it with the major goal being to establish with solid

evidence whether the Microsoft company had developed the monopolistic framework in its

operations. This was aimed at protecting the other software companies like Apple from

extinction. The monopolistic effect usually culminates in unfair competition and subsequent

destabilizing of the market whereby the monopoly leads in supply and decision making in a

particular market niche. The company managed to develop sophisticated computer systems,

which suited the professionals of all categories and careers. Furthermore, these tailored products

could only be compatible with the windows operating system. This dealt a blow to the other rival

companies like Linux Product Company because the Microsoft products were preferred and

could only be used in the windows operating system (First, 27). Microsoft used this move as a

scheme to phase out theory competitors in the computer industry. In addition, the company

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provided it clients with a free internet explorer for browsing while the other rival companies

charged its customers for using its browsers.

This gave Microsoft Company a competitive edge over the rest of the companies in the

computer industry. According to Hovenkamp (25), people used to pay hefty fees for using AOL

and Netscape. All these customers shift to Microsoft Company given that the company did not

charge for its internet explorer browser. However, the company was subject to exclusive dealing,

which offers any company the sole right to advertise or use a particular item in a particular

market niche. This aspect dealt a blow to the Microsoft rival companies because they could not

make use of any invention belonging to the company. This immensely contributes to the

expansion of the market leadership of the giant company over a long time. Moreover, Microsoft

made use of a pricing method, which only benefitted the users of the windows system. This

attracted many techno savvy people to the Microsoft Company. This large-scale operation led to

the monopolistic operation of the company, an aspect which resulted to the investigation of the

operations of the company. Hovenkamp (46) asserts that the monopolistic effect was legally

prohibited given that it resulted to artificial manipulation of the market due to the artificial

pricing. This effect also resulted in high demand of items, which are not in high supply due to the

seasonal production of some commodities. The monopolistic effect also limited the customer’s

choices due to the fact that they could only buy the commodities available at the monopoly.

The United States v. Microsoft Corporation case in which this company was implicated

of monopolistic practice was prosecuted by Justice Thomas Penfield Jackson (Reynolds, 35).

The plaintiff alleged that Microsoft Company applied monopolistic power in the Intel-based

PC’S especially with regard to the operating systems. The plaintiff complained that the defendant

bundled Internet explorer browser with its own operating system, which compromised browser

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Name: Course: Professor: Date: Introduction Microsoft Company was founded in the year 1975 by Bill gates and Paul Allen, when they entered into a joint venture. The company started by creation of many prototypes, which enabled it to simulate its systems quickly. Bavasso (38) asserts that Microsoft Company has advanced in the supplying and development of many types of software. It was investigated for antitrust behavior because of its tendency to abuse its market leadership in the software industry. In fact, the legal system investigated it with the major goal being to establish with solid evidence whether the Microsoft company had developed the monopolistic framework in its operations. This was aimed at protecting the other software companies like Apple from extinction. The monopolistic effect usually culminates in unfair competition and subsequent destabilizing of the market whereby the monopoly leads in supply and decision making in a particular market niche. The company managed to develop sophisticated computer systems, which suited the professionals of all categories and careers. Furthermore, these tailored products could only be compatible with the windows operating system. ...
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