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Is Microsoft A Monopoly?
In year 1999, Microsoft has been accused by Justice Department of United States as the corporation was suspected for using anticompetitive contracts with personal computer(PC) manufacturers to maintain unlawful monopoly.
During that time, there were about 95 percent of PC with Intel processors running a Microsoft operating system(OS). On April 3,2000, Judge Thomas Penfield Jackson had came out with his conclusions of law. He stated that Microsoft had committed and attempted monopolization.
Monopoly is defined as existence of a single seller in the market who produces goods that have no substitutes. A single firm has control over the resources and market by selling a unique goods.
In my personal opinion, Microsoft is monopoly not because of their market share in the PC software market. Actually it is Microsoft production line rests upon state enforcement of legal monopolies of duplication known as copyright.
For instance, imagine that there are two farmer known as Edward and Jacob. Edward want to start his business with papaya. Initially Edward buy a papaya from Jacob and utilizes the seeds within the papaya to plant papaya trees. Edward spends his own energy and time on the whole papaya plantation. After harvesting, Edward can actually sell them in direct competition with Jacob.
However, if it is a Windows OS , Edward cannot simply duplicate and sell it for many times even he may invest money and time. It is a crime where involves copyright violation.
It is distinctive between coercive monopoly and private dominant corporation like Microsoft. A coercive monopoly is created by government act and it achieves market share by legal protection against competition. On the other hand, Microsoft achieves...
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...devices. Now Google's Android and Apple's iOS is in the ascendency. Basically Windows' global share has been cut down to about 30 percent. Not forget to mention , Android is currently a bigger platform compared to Windows.
Lastly, and most recently, this chart from analyst Horace Dediu of Asymco illustrates that the PC business is no longer just getting dwarfed by the explosion of smartphone and tablet sales . PC no longer became the center of the personal computing world. Instead, it becomes a specialized office-productivity device. Multiple choice of devices made the full-blown PC is always not the most convenient, effective or simplest alternative to perform what a user wants to do.
In a nut shell, a current market share in computer industry does not guarantee of future success. Innovative competitors frequently break down what might appear to be monopolies.
Inventing Microsoft Windows, a software used by more than 50% of the world population in desktops/laptops, Gates practically owns the field of computer software technology. In the United States v. Microsoft Corp. Supreme Court case of 2001, Gates’ company was accused of becoming a monopoly, engaging in practices forbidden by the Sherman Antitrust Act of 1890. Another lawsuit was filed against Gates accusing him of monopolizing. Both of these cases were ultimately settled, allowing Microsoft to continue as it was. One could debate long and hard over whether Gates’ is the modern-age Rockefeller, controlling an entire industry. Many have tried, and failed, as seen in previous cases. Just as the other “captains of industry/robber barons” did, Gates’ saw an opportunity, took it, and completely exploited it. Whether doing so would be moral or immoral, is an entirely different argument.
A monopoly exists when a specific individual or an enterprise has sufficient control over a particular product or service to determine significantly the terms on which other individuals shall have access to it. A monopoly sells a good for which there is no close substitute. The absence of substitutes makes the demand for the good relatively inelastic thereby enabling monopolies to extract positive profits. It is this monopolizing of drug and process patents that has consumer advocates up in arms. The granting of exclusive rights to pharmacuetical companies over clinical a...
Microsoft is an American company that was founded by William Henry Gates III, as known as Bill Gates, and his his high school friend Paul Gardner Allen in 1975 April 4. But unluckily, Paul Allen resigned from Microsoft in 1983 after developing Hodgkin’s disease. In 1985 October 20, Microsoft released Microsoft window. It is the first original operating system. It is a graphical extension for MS-DOS. Even though, it’s not handy like nowadays Microsoft window. Then in 1990, Microsoft introduced Microsoft office, which is a bundle office productivity application with Microsoft Word and Microsoft excel. The Microsoft Word was the first application that could display italics. And the Microsoft Office would be available for free for all the PC World’s computer that is produce on that same year in November. In the 2000 February 17, Microsoft released Window 2000 operating system, and according to Microsoft it is the most safe operating system in the world at that time. But still, there are so many problems and glitches need to be fixed. Besides there are mutable computer viruses are made specially to attack Window 2000. Rush to gain back the sales. In the 2001 October 25 Window xp is available. The new operating system fix most of the problem. Although some of the user were still complaining the system that it will take your information, but in the 2007 January, there are 76% of people in the entire world are using the operating system.
Rivalry among established firms is fierce. There are several factors that illustrate this: established market players (6.1). The product is highly standardized and the switching costs of the customers are low. Players are aggressive (6.2)
By law a monopoly is not allowed to exist in the US. It has been long debated whether Microsoft is a monopoly or not? Among other charges Microsoft was charged with "monopolizing the computer operating system market, integrating the Internet Explorer web browser into the operating system in an attempt to eliminate competition from Netscape, and using its market power to form anticompetitive agreements with producers of related goods" (SWLearning).
Monopolies are when there is only one provider of a specific good, which has no alternatives. Monopolies can be either natural or artificial. Some of the natural monopolies a town will see are business such as utilities or for cities like Clarksville with only one, hospitals. With only one hospital and there not being another one for a two hour drive, Clarksville’s hospital has a monopoly on emergency care, because there is not another option for this type of service in the area. Artificial monopolies are created using a variety of means from allowing others to enter the market. Artificial monopolies are generally rare or absent because of anti-trust laws that were designed to prevent this in legitimate businesses. However, while these two are the ends of the spectrum, the majority of businesses wil...
Microsoft’s mission of placing a “PC running Microsoft software on every desk and in every home” drove their overall strategy early on. Depending on the business segment within Microsoft, one would see in place very different business models as the strategy for each line of business could vary. In the operating system (OS) segment, Microsoft initially brought in an existing product and modified this (MS-DOS) to work with the Intel microprocessor, which were the “brains” of the IBM PC. Microsoft partnered with IBM to provide the operating system for the IBM PC. In addition to developing Windows, Microsoft during this period was working to write applications for the Apple OS.
And then there's Microsoft themselves. After Bill Gates handed over CEO to Steve Ballmer, all hell broke loose as humans raged about him. During the first twenty years of Microsoft, they were considered an evil monopolistic empire, destroying all competitors that came their way. Back then, if you wanted word processing software, you used Office. Want a computer o...
There are two different yet similar ethical issues surrounding Microsoft’s product pricing. Within the United States there has been growing concern that because Microsoft controls such a large portion of the market that they are using this to their advantage and to drive prices up. A number of cases have been brought to court and found Microsoft guilty of price fixing, causing them to refund money to consumers in states like California and Iowa. The ethical issue clearly surrounds Microsoft’s motives. Are they driving up prices and simply trying to make more money with no thought to the impact on the community, or are they trying to run a legitimate profit-based business that strives to keep make everyone happier and ...
“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.
A Monopoly is a market structure characterised by one firm and many buyers, a lack of substitute products and barriers to entry (Pass et al. 2000). An oligopoly is a market structure characterised by few firms and many buyers, homogenous or differentiated products and also difficult market entry (Pass et al. 2000) an example of an oligopoly would be the fast food industry where there is a few firms such as McDonalds, Burger King and KFC that all compete for a greater market share.
Microsoft is currently the largest company in the computer industry. With a market capitalization of $291 billion, Microsoft has built an empire by dominating software sales for personal computers. Stock growth over the past 25 years has increased by more than 30,000%. However, Microsoft’s growth has substantially decreased since the market collapse of 2001(Niemond 25 April 2007).
A monopoly is “a single firm in control of both industry output and price” (Review of Market Structure, n.d.). It has a high entry and exit barrier and a perceived heterogeneous product. The firm is the sole provider of the product, substitutes for the product are limited, and high barriers are used to dissuade competitors and leads to a single firm being able to ...
From 1980 to 1996, Apple’s competitive range in the PC industry was rocky. Although Apples products were unique and well built, they were overpriced compared to competing products from IBM and others. As competitor prices dropped, Apple prices stayed the same and the company saw a decline in sales as customers opted to purchase from its competitors. John Sculley, former CEO of Apple, took many steps to improve the company’s competitive advantage. One of those steps was to compete with price by producing a low-cost computers that appealed to a mass-market. The second step was to form an alliance with rivals IBM and Novel in order to create new operating systems and applications...
•Monopoly: This is when a company that has no competition in its industry. It decreases output to drive prices up and therefore rise to its own profits. By doing so, it produces less than the socially optimal output level and manufactures at a substantial high cost than some other competitive firms. For example companies that are perceived as monopoly companies are the rail way and postal companies e.g. Scot rail and fed-ex. Companies like Scot rail use this to its advantage because a lot of the train go to the Glasgow and ...