Author(s)
Robert W. Hahn
Source
AEI-Brookings Joint Center for Regulatory Studies Related Publication 02-3, March, 2002
Summary
This paper looks at a proposal of 9 states and the District of Columbia to settle the antitrust suit against Microsoft.
Policy Relevance
States that are home to a firm's main competitors will be urged to propose policies that benefit those competitors, even if they hurt consmers.
Main Points
- In 2002, nine states and the District of Columbia argued against the settlement in the antitrust suit United States v. Microsoft by the United States Department of Justice.
- The states proposed an alternative that would regulate Microsoft’s prices and limit Microsoft’s ability to add features to Windows.
- Microsoft would be made to license its intellectual property practically for free, discouraging innovation.
- The many software developers and consumers who depend on Windows as a platform would be harmed by restrictions on the platform’s evolution.
- Many of the states supporting the alternative settlement were home to Microsoft’s most powerful rivals, and the states’ ideas would benefit those rivals more than consumers.
