Since the early 1990’s, the United States government and the Microsoft Corporation have ensued upon a battle in the United States courts. The main issue at hand is ultimately money, but one more importantly, the supposed "Microsoft Monopoly." The federal government maintains that Microsoft's monopolistic practices are detrimental to United States citizens, creating higher prices and potentially downgrading software quality, and should therefore be stopped. Microsoft and its supporter’s claim that they are not breaking any laws and they are just doing what they do; making money and providing a service. The only thing Microsoft is guilty of is taking advantage of free enterprise. There have been many arguments and issues that have been raised with the controversy over Microsoft and the U.S. Department of Justice’s claim against Microsoft of monopolistic practices in bundling its internet browser “Internet Explorer” into its popular Windows computer operating system. By doing this, Microsoft would effectively crush its competitors and acquire a monopoly over the software that people use to access the Internet.
Sherman Anti-trust Act was passed in 1890. The Sherman Act says “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal. The Sherman Act also provided for "Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony. The Sherman Act put the responsibility in the hands of the government to investigate and prosecute those suspected to be guilty of this crime.
In 1914, the Clayton Act was passed in conjunction with the Sherman Anti-trust Act to assist with anti-trust cases. The Clayton Act prohibited price discrimination between different purchasers if such discrimination substantially lessens competition or tends to create a monopoly ion any line of commerce. The Act also prohibits sales on the condition that the buyer or leaser not deal with the competitors of the seller or lesser “exclusive dealings”, or that the buyer also purchases another different product, but only when these acts substantially lessen competition. Mergers and acquisitions where the effect may substantially lessen competition are prohibited also by the act. The last prohibition of the act is that no person can be the director of two or more competing corporations.
Clayton Anti-Trust Law and how they all impacted the United States entrance into World War I.
Unfortunately, these monopolies allowed companies to raise prices without consequence, as there was no other source of product for consumers to buy for cheaper. The more competition, the more a company is forced to appeal to the consumer, but monopolies allowed corporations to treat consumers awfully and still receive their business. Trusts were bad for both the consumers and the workers, but without proper representation, they could do nothing. However, with petitions, citizens got the first anti-trust law passed by the not entirely corrupt Congress, called the Sherman Act of 1890. It prevented companies from trade cooperation of any kind, whether good or bad. Most corporate lawyers were able to find loopholes in the law, and it was largely ineffective. Over time, the Sherman Anti-Trust Act of 1890, and the previously passed Interstate Commerce Act of 1887, which regulated railroad rates, grew more slightly effective, but it would take more to cripple powerful
Before a series of antitrust acts and laws were instituted by the federal government, it was not illegal for businesses to use any means to eliminate competition in late nineteenth-century America. Production technology was now advanced to the point that supply would surpass product demand. As competition in any given market increased, more and more companies joined together in either trusts or holding companies to bring market dominance under their control (Cengage 2). As President Theodore Roosevelt was sworn into office in 1901, he led America into action with forceful government solutions (“Online” 1). Roosevelt effectively regulated offending business giants by the formation of the Department of Commerce and Labor, the Bureau of Corporations, and antitrust lawsuits.
The Sherman Act outlaws every contract, combination or conspiracy in restraint of trade. It also prohibits any attempt to monopolize. The Sherman Act enforcement can be civil or criminal. The criminal penalty can be up to $1 million for an individual and $100 million for a corporation. The Federal Trade Commission Act bans unfair methods of competition and deceptive acts or practices. Violation of Sherman Act also violates Federal Trade Commission Act. The Sherman Act and Federal Trade Commission Act are very effective, but they do not address certain specific practices. The Clayton Act addresses some specific practices such as mergers and interlocking directorates. For example, Section 7 of Clayton Act prohibits mergers and acquisitions that lessen competition or tend to create monopoly. Apart from these three core antitrust acts, most states also have antitrust laws. (FTC, 2014)
The Supreme Court ruled that the fixed commission rates were not subject to antitrust laws because of the SEC's power to regulate the financial markets. The Court affirmed that the implied exemption of the antitrust laws was necessary with respect to the fixed commission rates, avoiding the possibility of the conflict between the instruction from SEC to exchange and the antitrust law. The court decided that the repeal of the antitrust laws pertaining to the areas covered by the Securities Exchange and enforced by the SEC are necessary for the SEC to adequately enforce the laws.
The Clayton Act that was passed just 34 years later in 1914 does not have criminal penalties such as the Sherman Act. This act will not allow for a merger to happen that will diminish the competition of a produ...
middle of paper ... ... Also, some railroads gave special rates to some shippers in exchange that the shippers continued doing business with the railroad company. In the Clayton Antitrust Act, it said no one in commerce could regulate rates of price between different buyers (Document E). It said that otherwise, this would create a monopoly in any line of commerce. However, the Elkins Act of 1903 pushed heavy fines on the companies that did that.
Such as the case of two major players in the entertainment community of Sirius and XM who both have a majority of the marketplace in the satellite radio business and their talks of consolidating both businesses into one. This article on Ars Technica (Lasar, 2008) expands on the idea that these corporate entities should not be allowed to merge into one corporation, but above that should also be fined for even considering the idea in back rooms and locked boardrooms. Using the model case of the Sherman Anti-Trust act in Standard Oil, the corporation floated around having anywhere between eighty five percent and ninety five percent. With those numbers, XM and Sirius would fall into the numerical category of filling that condition of a monopoly.
The Clayton Antitrust Act was introduced in 1914 to clarify the principles the Sherman Antitrust Act set out to do. While the Sherman Antitrust Act said that monopolies were illegal, the Clayton Antitrust Act “defined as illegal certain business practices that are conducive to the formation of monopolies or that result from them. For example, specific forms of holding companies and interlocking directorates were forbidden.” (Britanica) This legislation was influential and was used to dissolve many monopolies in years to come.
"Microsoft Corporation, is a multinational computer technology corporation with global annual revenue of US$44.28 billion and 71,553 employees in 102 countries as of July 2006. It develops, manufactures, licenses, and supports a wide range of software products for computing devices. Headquartered in Redmond, Washington, USA, its best selling products are the Microsoft Windows operating system and the Microsoft Office suite of productivity software, each of which has achieved near-ubiquity in the desktop computer market. Microsoft possesses footholds in other markets, with assets such as the MSNBC cable television network, the MSN Internet portal, and the Microsoft Encarta multimedia encyclopedia. The company also markets both computer hardware products such as the Microsoft mouse as well as home entertainment products such as the Xbox, Xbox 360 and MSN TV" ("Microsoft").
In this paper, team B will discuss the internal and external factors of the Microsoft Corporation. We will explain how these factors affect the four functions of management, planning, organizing, leading, and controlling. Also, we will explain how globalization, technology, innovation, diversity and ethics will be delegated to manage the different factors. Microsoft Corporation was established in 1975 in Albuquerque, New Mexico producing software for developing, manufacturing, licensing, and support for range of software products and service for different type of computing devices. Microsoft grew from six employees to the largest personal computer software company in the world. By 1978, Microsoft earned $500,000 in the first quarter, and by the end of the year they earned revenue of $1,000,000. In the early 1980s Microsoft, in collaboration with IBM they released MS-DOS as their first 16-bit operating system. However after the late 1980s, Microsoft started to build its reputation by creating the Microsoft windows operating system and Microsoft office product, which includes internet explorer, excel, PowerPoint, and word programs. Then in the late 1990s, Microsoft teamed with Sega to incorporated their windows software package into the game developer’s Dreamcast hardware. Also they developed their own gaming system called the Xbox and that eventually was replaced by the xbox360. Microsoft has come a long way and is no longer just a worldwide leader in computer programming but also a major part of the technology world. Microsoft windows have been the flagship and accounts for most of its revenue for Microsoft: but the company has also branched ...
The best position on the Microsoft monopoly problem is one best for the general public, those who are and will be using Intel-PC products. This position is in opposition to Microsoft and to support the State and the public. This will consequently give the public better choice, thereby keeping the price of the product down and benefiting the general public. To understand why this position is the best choice two simple questions must be answered. The first is, is Microsoft a monopoly? And the second is, whether Microsoft is a monopoly or not, does that have a negative effect on the consumer? The answer to the first question is found by examining Microsoft and the second question is found by considering the company’s practices. After these two questions have been answered, a summary of why this position is better than others will be presented. Finally a conclusion of this argument will be given with some suggestions that go beyond the issue at hand.
“His agreements with hardware manufacturers have often served to prevent the success of rival products even when they are already on the market and Microsoft versions have yet to be completed. In 1995, the development of Windows 95, a revolutionary operating system, drove hardware manufacturers to produce computers with more memory and more hard disk space. Microsoft thus effectively compelled the entire computer industry to follow its lead. Such practices involved Gates and Microsoft in legal struggles over alleged anticompetitive practices and copyright infringement throughout the 1990s”(McGuire 1). With their more advanced operating systems they had to have more advanced computers that can run them but the other companies couldn't update their operating system as fast.
The standardized quality of MS Windows98 has really made the PC market as a whole take a rocket boost from the past. Most people who oppose this stance would say that standardizing a product wouldn’t cause anything but a monopoly. This is fiction because people choose products that are simply reliable and of good quality. The success of Microsoft’s operating system hasn’t been used to cause a monopoly in the browser marker, but to increase the quality of their software. A statement from Bill Gates on the 7th of December stating “ I am proud of the work our people have done to bring the benefits of the Internet to consumers, and I am confident that the courts ultimately will uphold the importance of the freedom to innovate.” The intensity of the Internet lies in it openness, freedom and incredible reach. It is physically impossible for any individual or company to be its controlling switch, as the number of Internet users continue to grow by easy access due to Internet technologies being added to quality operating systems such as Windows. Internet user will constantly demand high quality and maximum choice, and will travel to wherever they receive the best value for the money and time. As consumer interest in the Internet continues to grow, Microsoft’s role will be what it always has been. Aimed to provide the software building blocks for a rich computing experience and to build into that software all of the open Internet standards, protocols and platforms services which enable developers to write great applications. Even though Microsoft has included Internet capabilities in its Windows operating system since the launch of Windows 95, the Windows platform also provides excellent support for other leading browsers besides Microsoft’s own Internet Explorer.
Microsoft has always been known as a software company, and not well known for its hardware. In fact, the only hardware that Microsoft sells to the retail market is branded peripherals. In its heyday, Microsoft was a market leader, bring an operating system to the masses, and leading in internet search. In recent years, however, most of the moves that Microsoft has made have not been in a market leader position, but have been in response to competitors threatening Microsoft’s positions.