This story is a few days old but I’d like to point it out nonetheless. This court decision represents a victory for Microsoft and for capitalism, something we have been seeing too few of these days.
For those of you who do not know much about the antitrust case made against Microsoft, a simple look into the charges placed against the company reveals how ridiculous and arbitrary they are.
On May 18, 1998, the U.S. Department of Justice filed an antitrust suit against Microsoft. It was alleged that Microsoft violated the antitrust laws in the following four ways:
1. “Microsoft had forced other computer companies that used its Windows operating system to sign agreements that they would not license, distribute, or promote software products that competed with Microsoft’s own software products.”
2. “Microsoft ‘tied’ its own browser, ‘Internet Explorer’ to its Windows opearing system…”
3. “Microsoft had attempted to gain a monopoly in the Internet browser market by forcing computer companies that used its Windows operating system to agree to leave Internet Explorer as the default browser and to not preinstall or promote the browser of any other company.”
4. “Microsoft had a monopoly in the market for PC operating systems and had used anticompetitive and predatory tactics to maintain its monopoly power.”
Before I comment on this absurdity, I’d like to add one more unoffical charge leveled against Microsoft. The creation of what is called “a virtuous circle.” “In this virtuous circle, the more people that use an operating system, the more that software companies are willing to write programs for that operating system. The more software programs they write for the operating system, the more people want to buy that operating system.” (Quote provided by Business Ethics: Concepts and Cases by Manuel G. Velasquez)
Allegations 1 and 3 are easily wiped away by a definition of the word force. Force, in the context of human relations, is an attack on the human mind by using physical compulsion or threatening the use of physical compulsion in order to make an individual act against his own independent judgment. Did Microsoft make the decision to act on the part of the companies that it dealt with? No. The companies themselves decided to do business with Microsoft, which entailed, not supporting other businesses besides Microsoft in that given exchange. The companies involved always had the option to choose another alternative besides dealing with Microsoft, and at no point was any force or threat of force used against them.
If you were trying to sell a product, and you were in competition with others, do you think those other people have a right to share in the success that you alone create? Or do you think that in order for other businesses to enjoy success, they need to compete with you and take the proper course of action required for business success? The U.S. Government claimed that Microsoft’s competitors, namely, Netscape and Sun, had the right to be included in Microsoft’s business success. This is clearly absurd and a profound violation of individual rights. But this is the thrusting argument behind allegations 2 and 4.
Microsoft did not force anyone to do anything. Microsoft created a product which it then marketed to others. These others could either accept the product and mutually trade to each other’s benefit, they could reject the product and look elsewhere, or they could venture to create the product themselves. At no point in time did Microsoft force (act against their own will) any company to do anything.
So what was the attack on Microsoft based on? Using Ayn Rand’s words, it was caused by “the hatred of the good for being the good.” In modern politics, those who are unable to compete with the thrivingly successful companies such as Microsoft, use the government to put a gun to its head and “level” the playing field. It would be the same as claiming that during his time as a basketball player, it was unfair that Michael Jordan was so good and made so much money, so let’s force him to not use all of his talent in order to make him “equal” with the rest of us. This ridiculous attack on the good and on success is evident in the unofficial allegation made against Microsoft that I spoke of earlier, the virtuous circle.
It was alleged that this virtuous circle was “unfair” to other companies because it gave Microsoft success and made it harder for other companies to do well. Well of course it did! When a company creates a superior product which is chosen by the majority of software companies, it gains an advantage in the business market, and deservedly so! The reason that Microsoft was so viciously attacked was because of the fact that they created a superior product. They were attacked, not for their vices or their evil, but for their virtues, their good. There is no worse inversion of morality and all that is required of man’s life than this blatant attack on the good for being the good.
Some would say the reason why antitrust action was taken was due to the fact that since Microsoft had a monopoly, they could then decrease the quality of its product drastically and jack up the price. Yes, Microsoft is free to engage in this action, but not free to escape its consequences. Doing so would allow competition to gain a foothold in that market, and Microsoft at that point could either do nothing, and face a continual threat of rising competition, or they could better their product (quality + cost). This is the nature of competition in a free society. A company can have a monopoly in a given market, such as Microsoft in this market, but it can not have a coercive monopoly, meaning, it can not forbid any new competitiors from entering that market. Only an act of government (see Capitalism The Unknown Ideal) can forbid any new competitiors from entering a given market.
This attack on Microsoft was an outright attack on capitalism, justice, and the good. I fully support Microsoft in its battle against the U.S. Department of Justice, and I fully support every other company attacked by the hatred of the good for being the good.
