Much has been written recently about the investigations into Microsoft's
attempt to dominate the browser market (eg
http://news.com/News/Item/0,4,15416,00.html). I found many of the comments
to be very confused.
There are two distinctly different anti-competitive practices (the seppo's
refer to this as anti-trust): One is price fixing (eg oil companies) and
the other is abuse of market power.
Price fixing is there all the banks get together at the pub and decide not
to pass on the interest rate cut, abuse of market power is where the only
manufacturer of (say) monitors says "I won't sell to you if you buy
processors from X"
Of the commentators that stuck up more micro$oft, most have said "but
prices have fallen..."
This is a very naive comment because:
1) As far as I can tell, the investigations relate to abuse of market
power rather than price fixing
2) The computing industry is one where we expect prices to fall. The fact
that they have fallen so slowly is notable in itself. We were promised
cheaper software when CDs came out because there would be less need for
expensive shipping and chunky manuals, but it never happened. This is
usually an indication that competition is not working properly.
3) Once a company such as Micro$oft succeeds in crushing all other
producers, I wonder if prices will stay low...
Quite simply, they are stifling innovation and consumer choice.
Did you know that Beta is a far better video system than VHS? In a market
domination style of marketing, the consumer gets left with the one that is
market best, not the one that works the best.
Anyway, food for further comment...
Chris Wood, Undergraduate Science/Law
Ph (02) 9560 3958 or (02) 9210 4284
GOVERNMENT HEALTH WARNING
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