Reactions to the Ruling

    Microsoft advocates say Judge Jackson failed to appreciate the dynamic and super-competitive nature of the software industry. This nature makes any dominant position inherently short lived. They say any firm that takes advantage of its position to harm consumers will surely see its market power eroded by new entrants. Entry is not only possible, but also likely, as entrepreneurs are encouraged by an industry where little or no startup costs are incurred, for no infrastructure is required.

    Furthermore, Microsoft advocates cite the AOL-Time Warner merger as proof that any monopoly is under constant threat. In a free capital market (one in which mergers are not impeded by government regulation), combination of several firms with little capital can result in overnight competition. The AOL juggernaut now has $350 billion in assets, to match Microsoft's $400 billion, creating more competition than was previously imagined possible.

Back    |    Next
    Index