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Microsoft: Did Judge Jackson Get It Right?

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from: Jonathan Zittrain
to: George L. Priest

Posted Monday, Nov. 29, 1999, at 9:00 PM ET

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In early November, Judge Thomas Penfield Jackson released his findings of fact in the Microsoft antitrust trail. Did he get the facts right? How did he apply the classic tests and definitions of antitrust doctrine to the case? This week, Jonathan Zittrain and George Priest discuss these questions, as well as recent twists in the case.

Microsoft succeeded "most generally through merit," you say, and I don't mean to deny that this might be the case. It's not easy to sum a set of complex causes and say which one mattered most, particularly when more than one might have been necessary to success.

You seem to suggest that the question for Judge Jackson is "On balance, did Microsoft succeed primarily as a result of its high-quality products or due to its allegedly illegal tactics?" I worry that means the law should be ready to back off if it concludes that Microsoft tilted the playing field but probably would have won the game anyway. Particularly where winning and losing aren't really a single act (although I do believe the browser wars are over), a little tilt of the field can mean a lot even to the better team.

Might a better question simply be "Did any of Microsoft's tactics cross the line from 'hardball' into anti-competitive?"

The penalties may turn out to be rightfully narrow if, as you argue, any particular illegal behaviors Microsoft used were in fact of little consequence to the ultimate outcome. But, in the immediate task at hand of "findings of law," I see little need to consider the effects of the behaviors established in the findings of fact; the question of which particular behaviors had or didn't have a material effect on the outcome is properly considered, I suggest, only in the course of determining an appropriate remedy.

I suppose I'm concerned about this point ultimately for its implications in how, if at all, Microsoft might ultimately lose its position of dominance. Consider the effect of Microsoft's contracts with OEMs and others: To the "regular" lock-in effects that result from the sheer collective difficulty of moving to a new OS--training, reinstallation, application and driver development, these licensing contracts entrench Microsoft that much more. That's not to say that Microsoft is "completely" safe forever--indeed, if a competitor came along that was much better than Windows, there's every reason to think the market would ultimately move to the competitor's product. But Judge Jackson says that Microsoft has taken deliberate steps to make that eventuality that much more unlikely--to raise the bar for competitors that much farther above where it would otherwise be.

On your question of whether Web browsers are in fact competitors to operating systems: There's a sense in which you're right to argue that they're not, for nearly every Web browser I know of, and certainly every mainstream Web browser, runs only on top of another underlying system. But that seems to me an unreasonably narrow understanding of what it means to be a competitor. For, if most software that most people used day in and day out really did operate inside a Web browser--rather than interacting directly with the operating system--then browsers would compete with operating systems for the minds of developers, and ultimately users, as platforms in which to run software applications. You'd only need to get a computer that runs, say, Navigator, rather than a computer that runs Windows.

Ultimately, I tend to think of Web browsers, as Netscape and Sun envisioned them years ago, as "substitutes in training" for operating systems. They weren't there yet--browsers still needed to run on top of operating systems--when Microsoft cut them off at the proverbial pass. But that, I believe, is exactly the point. Users and developers never had a fair chance to evaluate the potential of the model Netscape and Sun envisioned, not simply because they couldn't pull it off fast enough or effectively enough but because, it seems, Microsoft was doing everything in its power not just to improve its own offerings but to hinder and complicate theirs.

I'm also curious to know: What do you make of Judge Posner's addition to the mix?

dialogues
entries
123456
from: Jonathan Zittrain
to: George L. Priest

Posted Monday, Nov. 29, 1999, at 9:00 PM ET
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