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by richardwhiuk 3222 days ago
It's not against the law to have a monopoly - it's against the law to exploit having a monopoly to enter another market.

Microsoft was seen to be exploiting it's consumer OS market share to gain a monopoly in the browser market and the productivity software market, AIUI.

5 comments

And as Jim Clark, co-founder of Netscape, said in a recent interview on This Week In Startups the problem was Microsoft was not just bundling their browser (not a big deal), but pressuring OEMs that they'd be unable to sell Windows or lose access if they bundled Netscape too.

They used their monopoly position to force vendors to prevent Netscape from being bundled. Thats where they went too far.

Disclosure: IANAL

It's such a strange arbitrary law though. At the root, it's about preventing companies from using their position of power to gain an unfair advantage in other markets.

But huge corporations like Google, Facebook and Amazon are using their scale and their positions to take over markets. They can easily take control of any market they want, for them it's just a matter of doing so in a way that doesn't upset regulators. Regulators are already the bottleneck for them.

"It's not against the law to have a monopoly - it's against the law to exploit having a monopoly to enter another market."

What about the breakup of Ma Bell?

> What about the breakup of Ma Bell?

"AT&T was, at the time, the sole provider of telephone service throughout most of the United States. Furthermore, most telephonic equipment in the United States was produced by its subsidiary, Western Electric. This vertical integration led AT&T to have almost total control over communication technology in the country, which led to the antitrust case, United States v. AT&T. The plaintiff in the court complaint asked the court to order AT&T to divest ownership of Western Electric"

i.e. AT&T used its network monopoly to maintain control over hardware manufacture.

https://en.wikipedia.org/wiki/Breakup_of_the_Bell_System

The breakup was a settlement of an anti-trust lawsuit over them leveraging their handset hardware monopoly to subsidize network costs so as to protect their telephone service monopoly, IIRC.
No, it can be against the law merely to have (and keep) a monopoly.

It is against the law to acquire, or to perpetuate, a monopoly by any combination or conspiracy in restraint of trade.

Although you're quite right that the move into the browser market was a big part of the case against Microsoft, there were other pieces to that case. There was a whole bunch of work around APIs/ABIs and in particular, denying other parties access to secret or privileged APIs in order to cripple potential challengers to the existing OS market (e.g. Java/Sun).

(Notwithstanding that the Microsoft strategic work around the browser stuff was a very correct reading that the browser was destined to become the de facto OS.)

Yes, it's complicated and there's a whole century+ of interesting jurisprudence. But it's not sufficient to just declare it's OK to have a monopoly -- you can be at risk of antitrust suits even just 1. having a de facto monopoly and 2. doing the "normal" smart business things to hang onto it.

For further reading, start with https://www.justice.gov/atr/us-v-microsoft-courts-findings-f...

I disagree with this argument – it can be illegal to participate in uncompetitive business practices while holding a monopoly position (even when those practices would be competitive in another market) but that does not make it illegal to have a monopoly position. The parent is right - having a monopoly position in a market is not illegal.
This is a good point. And with all the big internet companies doing so much to "help" us by setting up complex AI filters to catch and filter hate speech, what they're effectively doing is shutting the door to competition. They're raising the bar to the point where there will be no new Facebook or Google. New companies won't be able to afford the CPU cycles or manual content reviewers.