Date: Tue, 19 May 1998 15:16:14 -0700 (PDT) From: Annelise Anderson <andrsn@andrsn.stanford.edu> To: freebsd-chat@FreeBSD.ORG Subject: Re: Why we should support Microsoft... NOT! Message-ID: <Pine.BSF.3.96.980519145457.29139A-100000@andrsn.stanford.edu> In-Reply-To: <199805190203.UAA24651@lariat.lariat.org>
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It's fine to debate alternative remedies, but from an economic point of view (not necessarily always followed in law) Microsoft's operating system is a natural monopoly. I'm actually not sure whether that constitutes much of a danger or whether the remedies are good in terms of improving the situation for consumers, which is this issue my colleague Bob Hall will be talking about in an op-ed in tomorrow's New York Times. There are other operating systems, but the defining characteristic of the os is that it runs a particular set of programs.[1] For that set of programs, the MS os is pretty close to a monopoly: there's no very good competition (wine, bochs, freedows, pcemu)? And other operating systems are not a very good substitute for the MS os, given the importance of the programs it runs. The economic definition of a monopoly is that it has declining marginal costs (the cost of producing another unit). The MS cost is zero. Thus, the difficulty of competing with them: of putting enough money into the alternative and being able to sell the resulting product. A venture capitalist with whom I talked at dinner a few nights ago claimed that his firm is a major player in financing startups in the Internet field; and they won't have anything to do with an firm that is threatened by Microsoft (they will finance potential MS targets, of course--e.g., Hotmail). It's possible that government intervention here would be worse for this rapidly changing area than whatever MS can manage to do; but its potential is to raise the price, eventually, of the os itself. Note that where there are few alternatives (e.g., WordPerfect for a unix platform) prices are much higher than where there's competition (word processors for Windows). --Annelise [1] I know this isn't an engineering definition, but it is the practical effect of the engineering definition. To Unsubscribe: send mail to majordomo@FreeBSD.org with "unsubscribe freebsd-chat" in the body of the message
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