I'll make the broad assumption those posting in this thread don't mind a good read, especially when it is on point.
Herewith please find two columns having to do with the Microsoft/Anti-trust issue here in the U.S., written by one of the smartest fellows on the planet, a certain Dr. Thomas Sowell.
I do not intend that these counter the situation with the E.U., merely to enlighten as to what went on in the U.S. at the time the case was meandering through our court system; a careful read might lend some clarity.
Enjoy!
Microsoft and Anti-"Trust"
The biggest question about anti-trust law is whether there really is any such thing. There are anti-trust theories and anti-trust rhetoric, as well as judicial pronouncements on anti-trust. But there is very little that could be called law in the full sense of rules known in advance and applied consistently.
Federal judge John Penfield Jackson's November 1999 ruling in the anti-trust case against Microsoft is a classic example of lawless "law." Just what specific law did Microsoft violate and how did they violate it?
While Judge Jackson's long pronouncement opens with a brief reference to sections 1 and 2 of the Sherman anti-trust act, this is little more than a passing formality. What follows is a lengthy exposition of theoretical conclusions about the economic meaning of Microsoft's actions. Is Microsoft supposed to have violated a theory or to have violated a law? What was it that they should have known in advance not to do?
Courts have declared laws against vagrancy to be void because of their vagueness, which gives the individual no clear understanding of just what they are supposed to do or not do. But vagrancy laws are a model of clarity compared to Sections 1 and 2 of the Sherman Act, which forbid conspiracies "in restraint of trade" or any "attempt to monopolize."
Just what does that mean? It means whatever Judge Thomas Penfield Jackson or any other federal judge says it means -- at least until they are reversed on appeal.
But what does it mean to a company that is supposed to obey this law? It means that there is no law, just a cloud of legal uncertainties, from which lightning can strike at any time.
In economics, "monopoly" means simply one seller. If you could invoke this provision of the Sherman Act only when there was just one seller, lots of Justice Department lawyers would be out of work, because there are very few products sold by only one company.
The ploy that prevents unemployment among anti-trust lawyers is to claim that some company sells a high percentage of some product -- or, in the rhetoric of anti-trust, "controls" a large share of the market. And the way to produce statistics showing large shares is to define the market as narrowly as possible.
Judge Jackson does this by defining the market for operating systems like Microsoft's Windows as being only those operating systems using Intel's processors and their clones. That means we don't count Apple computers or computer systems relying on the Linux computer language.
These kinds of definitional games have been played throughout the history of anti-trust "law." The net result is that there are statistics showing many more "dominant" companies with "market power" in these narrowly defined industries than there would be if industries were defined in some economically meaningful way. Judge Jackson's pronouncements are larded with such ominous rhetoric.
What also runs through Judge Jackson's statements -- and through the whole anti-trust tradition -- is a confusion between competitors and competition. Harm to Microsoft's competitors is equated with harm to competition in the software industry. But nothing harms particular competitors like competition.
When Microsoft spent $100 million to develop its Internet browser and included it in Windows free of charge, to Judge Jackson that showed monopoly power and hurt competition. But why would a monopoly have to blow $100 million to improve its product?
It was precisely because Microsoft was not as optimistic as Judge Jackson about a lack of competition that they spent the money to keep their customers. Is it a violation of law to operate on a different economic theory than the one a judge believes in?
But suppose, for the sake of argument, that Microsoft was guilty of every terrible thing the Judge came up with. All the contract provisions he doesn't like can be forbidden and all the competitors who were supposed to have been harmed can be compensated to the tune of millions of dollars.
Why then is the Justice Department involved? Because they want the power to oversee and second-guess the computer software industry. Microsoft's competitors in Silicon Valley may rejoice at its legal misfortunes, but once Washington bureaucrats start calling the shots in the computer industry, their joy may be very short-lived. Silicon Valley rivals of Microsoft could turn out to be like those Democrats of a few years ago, who voted for special prosecutors as if they were only going to prosecute Republicans.
Here is column 2.
Fast computers and slow antitrust
FEW THINGS DEVELOP AS FAST as technological change in the computer industry. And few things are as slow as antitrust cases. So an antitrust case against a computer software company like Microsoft is about as big a combination of opposites as you can find.
Five years is breakneck speed for completion of a major antitrust case and it is not unknown for a decade or more to elapse before the appellate courts say the last word on one of these cases. Five years is at least two generations when it comes to computers. A decade ago, laptops were a novelty of the rich.
The idea of slowing down innovation in the computer industry to the glacial pace of the legal system is grotesque. Yet that is what the Justice Department's Antitrust Division tried to do when it asked the courts to stop the recent introduction of Microsoft's new Windows 98 operating system until the legal fine points could be argued out.
Antitrust law is so full of ambiguous phrases, mushy concepts and elusive definitions that it cannot really be considered law. Laws are supposed to tell you in advance what you can and cannot do, not just allow government officials to nail you when they don't like what you are doing or want you to do it their way.
Antitrust cases can involve years of wrangling in the courts and many millions of dollars in legal fees, even when the plain facts of the case are not in serious dispute. That is because the terms used have no clear and consistent meaning. Microsoft is accused of being a "monopoly" that uses its "power" to prevent rival software producers from being able to compete. The Justice Department claims to be trying to protect "competition" by reining in Microsoft's ability to exclude other companies' software from its Windows operating system.
Let's begin at square one: Is Microsoft a "monopoly"? By the plain dictionary definition -- one seller -- it is not. Apple computers have a different operating system, for example. By an economic concept of monopoly -- a firm able to prevent other firms from engaging in the same activity -- it is likewise not a monopoly.
In antitrust law, however, numbers and percentages can be used to claim that a particular company "controls" a certain share of the existing market. If that share is very high, then the firm may be considered to be a rough equivalent of a monopoly.
Slippery words like "controls" insinuate what can seldom be plainly stated and proved. If a high percentage of the customers buy your product, that statistic after the fact does not prove that you controlled anything before the fact.
Those same customers can change their minds tomorrow and you will be history. That is why Microsoft keeps updating its operating system and adding new features. If it really controlled its market, it could relax and let the good times roll, instead of constantly scrambling to stay ahead of its rivals and potential rivals.
While the Justice Department's Antitrust Division claims to be trying to protect "competition," it is in fact trying to protect competitors. Competition, like monopoly, is a set of conditions in the market. It cannot be reduced to an outcome like percentages of sales.
There is competition in boxing when the champion agrees to fight the leading challenger -- even if the champ knocks him out in the first round. Competition is about a set of initial conditions, not about outcomes.
The Antitrust Division wants to prescribe outcomes by asking the courts to force Microsoft to include rival Netscape's Internet software in its own Windows system. Some in the media have spread the disinformation that Microsoft makes it impossible to put non-Microsoft software in its system or on the Windows screen.
My own computer came with non-Microsoft software, including Netscape, on the Windows 95 screen -- and I didn't even order Netscape. The computer manufacturer put it there. Moreover, Windows is set up so that the consumer can easily install all sorts of other software. Why some media people don't bother to check out the simplest facts is beyond me.
Some media pundits have been calling Microsoft founder Bill Gates "arrogant" for dismissing the Justice Department's arguments as nonsense. But Gates' real problem may be that he is not a lawyer, and so does not realize that much nonsense is already an established part of antitrust law and precedents.
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What kind of response did you expect? 
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