Microsoft has seen nothing but red since Monday's United States district court ruling against them. Their stock value dropped significantly; as a result, the NASDAQ financial index took a huge hit, and Bill Gates' fortune dropped to a mere $97 billion US. That's got to be a huge blow.
The court case surrounds whether or not Microsoft violated US anti-trust laws. These same laws have existed since the monopolistic days of John D. Rockefeller's Standard Oil Co.--they essentially bar you from running a monopoly in the US marketplace. Microsoft ran into trouble mainly because of its insistence on attaching a Web browser to all the operating systems it sells. For all you non-techies out there, this means that Microsoft includes Internet Explorer with every copy of Windows it unloads.
At first, the idea of giving away one product when you buy another may seem fairly benign. The fear, however, is that because Microsoft dominates the operating platform arena, it won't be long before its Web browser subdues all competition and becomes the only product in the marketplace. And not long after that Microsoft could start selling it for a mint because there's nobody left to offer any alternative. Too far-fetched? Why then does Microsoft give away a free Web browser with every copy of Windows? It ain't out of the goodness of their hearts. Bill Gates didn't amass his fortune by being a technological philanthropist.
Fortunately, this dire future in which Internet Explorer dominates has yet to become a reality. In his decision, Judge Thomas Jackson admitted that Microsoft had, as of yet, been unsuccessful in dominating the Web browser market. His stern ruling was the result of Microsoft's attempt to dominate the market by monopolistic means, not its success in doing so.
What this means for the future of Microsoft is unclear. Assuming the expected court appeal is unsuccessful, Microsoft's punishment could range from a court order to stop all the way to being broken up and sold off as smaller, competing companies. What it will likely mean for consumers, however, is there will be more competition in the marketplace. Generally, this leads to better products at lower prices and that's not such a bad thing.
Judge Jackson's basic message is if you're going to play the game, you have to play by the rules--that even includes multi-billion dollar companies like Microsoft. Critics in favour of laissez-faire free market economics point out that Jackson leveled a strong anti-Microsoft ruling on a similar matter in 1997, only to see it overturned by a unanimous appeals court decision. They posit that Jackson's recent decision may just end in similar ignominy.
Well, put a notch in the belt of the bourgeois fat cats when it happens. In the mean time, I say long live the consumer and small businessman. It's always kind of nice when us small fry win against the big fish like Microsoft and Bill Gates. It just goes to show that even the economic sharks out there have to swim in formation with the rest of us.