U.S. vs. Microsoft: Did Consumers Win?
AbstractU.S. v. Microsoft and the related state suit filed in 1998 appear to have concluded. In a unanimous en banc decision issued in late June 2004, the D.C. Circuit Court of Appeals rejected challenges to the remedies specified in a settlement reached in late 2001 and approved by the District Court in November 2002. The wave of dozens of follow-on private antitrust suits filed against Microsoft also appears to be subsiding, following many settlements and some dismissals. Related issues, however, continue to be the focus of competition agencies outside the United States, including the European Union and Korea. In this paper we review the remedies imposed in the United States, in terms of both their relationship to the violations found and their impact on consumer welfare. We conclude that the remedies addressed the violations ultimately found by the Court of Appeals (which were a subset of those found by the original district court and an even smaller subset of the violations alleged, both in court and in public discourse) and went beyond them in important ways. Thus, for those who believe that the courts were right in finding that some of Microsoft's actions harmed competition, the constraints placed on its behavior and the active, ongoing oversight by the Court and the plaintiffs provide useful protection against a recurrence of such harm. For those who believe that Microsoft should not have been found liable, because of insufficient evidence of harm to consumers, the remedies may be unnecessary, but they avoided the serious potential damage to consumer welfare that was likely to accompany the structural remedy imposed by the original district court and the more extreme restrictions on conduct later proposed by some of the state plaintiffs. The remedies imposed appear to have struck a reasonable balance between protecting consumers against the types of actions found illegal, on the one hand, and, on the other hand, avoiding excessive restrictions that would harm consumers by restricting Microsoft's ability to compete in pro-competitive ways.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Regulation2point0 in its series Working paper with number 109.
Date of creation: Sep 2005
Date of revision:
Contact details of provider:
Web page: http://regulation2point0.org/
Other versions of this item:
- K21 - Law and Economics - - Regulation and Business Law - - - Antitrust Law
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
- L4 - Industrial Organization - - Antitrust Issues and Policies
- L6 - Industrial Organization - - Industry Studies: Manufacturing
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Takanori Adachi & Takeshi Ebina & Makoto Hanazono, 2011. "Option Package Bundling," KIER Working Papers 785, Kyoto University, Institute of Economic Research.
- Joshua Wright, 2011. "Does Antitrust Enforcement in High Tech Markets Benefit Consumers? Stock Price Evidence from FTC v. Intel," Review of Industrial Organization, Springer, vol. 38(4), pages 387-404, June.
- Oliver Budzinski & Isabel Ruhmer, 2008.
"Merger Simulation in Competition Policy: A Survey,"
MAGKS Papers on Economics
200807, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Oliver Budzinski & Arndt Christiansen, 2007.
"The Oracle/PeopleSoft Case: Unilateral Effects, Simulation Models and Econometrics in Contemporary Merger Control,"
Marburg Working Papers on Economics
200702, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Budzinski, Oliver & Christiansen, Arndt, 2007. "The Oracle/PeopleSoft case: unilateral effects, simulation models and econometrics in contemporary merger control," IBES DiskussionsbeitrÃ¤ge 157, University of Duisburg-Essen, Faculty for Economics and Business Administration.
- Cerquera Dussán, Daniel, 2006. "Dynamic R&D incentives with network externalities," ZEW Discussion Papers 06-94, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Oliver Budzinski, 2008. "A Note on Competing Merger Simulation Models in Antitrust Cases: Can the Best Be Identified?," MAGKS Papers on Economics 200803, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Oliver Budzinski, 2009. "Modern Industrial Economics and Competition Policy: Open Problems and Possible Limits," Working Papers 93/09, University of Southern Denmark, Department of Environmental and Business Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Archive Maintainer).
If references are entirely missing, you can add them using this form.