Antitrust law as highlighted in section 2 of the Sherman Act seeks to safeguard small companies from any company that has monopoly power and can use its position to fix prices and exclude competition (Jones, 2000). Microsoft Corporation, a computer software manufacturing giant based in the United States has been accused severally for the violation of the antitrust law. One such civil suit was initiated in the year 2002 where Microsoft faced a civil suit by the United States for monopolization, which is against the antitrust law.
In this civil case, Microsoft was found guilty of monopolization where it was found to use its financial power to fix prices in the market so as to exclude competition. In this civil suit against Microsoft, the company was found to occupy more than 80% of the total market share as many computers in the market use Intel chips which in turn use operating systems that are Intel compatible. This has made Microsoft Company to dominate the market as it is the main distributor of Windows Operating Systems that are Intel compatible.
Another civil case against Microsoft was initiated by 19 states in the year 2007 where it was accused of violating the antitrust law. In this case, the software giant was accused of using anti-competitive means to lock out its competitors out of the market by using application barriers. The company was accused of blocking the use of middle-ware products that act as platforms to facilitate users to use any operating system of their choice.
Microsoft was also accused of threatening other software developers to terminate the manufacture of middle-ware products. Microsoft Company was also under another investigation by the U.S. Department of Justice for violation of the antitrust laws. In this investigation, Microsoft was found to be unlawfully integrating windows and its browser program Internet explorer. The company was also found to be in an attempt to monopole the internet (Hepburn & Lopatka, 2007).
The charges levied against Microsoft in all the above cases were valid. According to Hepburn and Lopatka (2007), Microsoft Company is not the leader in software manufacturing because of its innovative capability, but due to its prowess in taming competitors by use of unethical means. The company’s ability to block middle-ware products is a clear indication that the company fears competition especially in operating systems which is the company’s area of dominance.
The company has also entered into agreements with other companies especially the ones that manufacture computer hardware such as Intel and IBM to make sure that most of the hardware produced in the market is customized to only use Microsoft products at the expense of its competitors.
Another clear indication that Microsoft is going against the Sherman Act in the name of innovation is the integration of various products to its windows operating systems. For instance, Microsoft tied its internet browser, Internet Explorer only to use its operating systems with the aim of dominating the internet. The company inclusion of Java run time environment on its windows and writing programs that are windows-specific java version made the java programs not to function across other platforms.
All this was done by the software giant with the aim of countering java software that was available across other platforms. The introduction of internet browser program Netscape navigator is another area of interest that brands Microsoft as a violator of Sherman Act. The introduction of Netscape navigator in 1994 made Microsoft to respond by introducing its own browser Internet explorer and distributing it free of charge which made Netscape navigator to give up its browser program.
In conclusion, it is apparent that Microsoft Corporation has continued to violate antitrust laws commonly referred to as Sherman Act thus denying other businesses in the same market an opportunity to establish their products. It will be beneficial for the consumer and the general economy if the antitrust laws are enforced to enhance competition in the software manufacturing industry.
References
Hepburn, W. & Lopatka, E., J (2007). The Microsoft Case: Antitrust, High Technology, and Consumer Welfare. New York: University of Chicago Press.
Jones, K. (2000). Microsoft Anti-Trust Case. Time Line. Web.