Published December 2000

Break up Microsoft?
Rest of world pooh-poohs the notion

It’s strange how different some things appear from a distance.

Take, for instance, the U.S. government’s expensive, time-consuming efforts to break up Microsoft for monopolistic tendencies in the marketplace.

On a global perspective, attacks on the software giant seem puzzling, according to the Alexis de Tocqueville Institution — www.adti.net — a nonpartisan, nonprofit think-tank in Arlington, Va.

“Oddly, although the U.S. case against Microsoft resembles both current and previous cases against the software giant in other countries, the U.S. seems to be alone in its aggressive pursuit of breaking up Microsoft,” said Kenneth Brown, the institution’s president.

“We have insisted on divestiture in other competition matters,” says Willy Helin, Minister Counselor for the European Union in Washington, referring to the recent AOL-Time Warner case, “however, we are not recommending a break-up or divestiture of Microsoft.”

In January 1998, Japan launched an antitrust probe of Microsoft involving software bundling, which was resolved favorably in November 1998. Kouki Arai, First Secretary of the Economic Section for the government of Japan, commented, “We don’t believe that companies can be too big. ... We are proud of our success with resolving competition matters with companies like Microsoft without seeking divestiture or break-up.”

Last February, a Swiss competition body launched a probe to investigate Microsoft’s pricing of its products. But Rafael Corazza of the Price Surveillance Commission commented, “No governing body of Switzerland has the authority to order the break-up of a company which is already established.”

In his global study of the Microsoft issue, the ADTI’s Brown noted, “Our global partners value Microsoft. ... Isn’t it curious that certain American officials do not?”

Curious, indeed.

While Microsoft awaits an appellate court review of the earlier federal court ruling, the marketplace continues to solve its own competition issues, with many of the Microsoft case’s plaintiffs operating in even stronger market positions than when they complained about being forced out of business by Bill Gates’ “monopolistic” actions.

Maybe we need the perspective that distance offers.

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