Cyber Monopoly Solutions
The Microsoft trial is far from over. Though it looks like the software giant is struggling, it’s uncertain whether the presiding judge, Thomas Penfield Jackson, will find Microsoft guilty of violating the Sherman Antitrust Act. The vagueness of the 1890 law has led judges to a wide variety of interpretations. In the last decade and a half, for example, federal courts have ruled that the law applies only to companies laying siege to rivals for the sole purpose of harming them.
Nevertheless, after depositions this week in which executives from Netscape, America Online and even Microsoft itself testified that the company had tried to corner the Internet browser market, most observers agreed that Jackson will have to do something to ensure competition in cyberspace.
Earlier this year, Microsoft executive Bob Herbold admitted that programmers developing word processors, games and other software on their own stand little chance of succeeding unless they have a contractual agreement to develop programs with Microsoft as an official vendor. That seriously restricts opportunities for entrepreneurial innovation, because Microsoft’s Windows program now runs over 90% of the world’s computers and is poised to dominate a broad range of cyber-markets.
While the trial is expected to run through next month, Justice Department prosecutors and computer industry representatives are already discussing market-based solutions. Judge Jackson should consider the most promising proposals so far, which involve compelling Microsoft to make its computer coding or “application program interface” readily available to software developers or requiring Microsoft to license its operating system or “source code” to other software developers. The latter would essentially turn Windows into a public facility, much like a railroad track, to which other software developers could hitch their programs.
Judge Jackson should disregard envious competitors of the inarguably flourishing company and its vastly wealthy founder, Bill Gates. But he should also disregard those who say that the Sherman Act is no longer relevant in a high-tech world. Whether their business is silicon chips, railroads or telephones, monopolies that stifle innovation have the same unwelcome effect.
