Is Microsoft XP All It Should Be

By: Aaron Schwartz
Submitted: 2007-01-17 16:08:15
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The financial world at the end of 1990s – beginning of 2000s was shaken by scandals concerning the leading company on the software market – Microsoft that was accused in the monopolization of the market. Such accusations are not surprising and as for me I think it was just a question of time to declare them publicly. It is a well-known fact that Microsoft occupies a dominant position in their sector of the market. Naturally, the owners of the company did their best to sustain such a beneficial situation in order to increase their profits but their attempts finally resulted in antitrust investigations and court processes all over the world (the USA, Europe, some Asian countries). So, it is evident that here we have to opposing sides: on the one hand, Microsoft and on the other hand, their rivals and consumers who suffered from a monopoly of Microsoft though on the surface consumers seem to be untouched by the conflict but in reality it is not so.

To understand the influence of monopoly of Microsoft in the operating systems market and all accompanying sectors we need to analyze the situation on the market in details. Firstly, I want to start with the causes that led to accusations against Microsoft. Their roots lie in the nature or structure of the business scheme used by the company. Its main principles are based on the idea of struggle for domination and penetration in all spheres of the market making alliances which may be helpful, even if they are imposed to the partners. Windows operating systems produced by Microsoft are not compatible with the products of other companies that make it practically impossible to use drivers or any peripheral equipment of any other company but Microsoft or, at any rate it will be very uncomfortable for consumers for it will engender unstable work of their PCs. It is a very significant fact, especially, if we will take into consideration the fact that different modifications of Windows are installed on about 90% of all PCs that creates competitive conditions absolutely unbearable for Microsoft’s rivals.

Especially, it concerns Windows XP which had a lot of arguments from the part of the rivals before its launch. The rivals estimated that this operating system included some elements of software which were previously separate pieces. For example, multimedia software is installed a priori and it deteriorates greatly the position of multimedia software producers. Moreover, opponents of Microsoft say that Windows XP threatens to consumers’ privacy because it demands a great amount of personal information during the process of installation of this operating system. For Microsoft’s operating systems are the principle part of their software production that provides its domination the company tends to prevent any interference in this sector of the market. In addition, Microsoft conceals real prices of its products that allow to the company to control prices and make them higher. Such situation would be impossible if there were normal competitive relations on the market.

Unfortunately, it is not all the facts that harm consumers. Among other negative factors I can name such as the lack of real choice of operating systems’ elements as well as operating systems themselves because Microsoft occupying a dominant position can easily manipulate the market and provide for consumers only that elements that the company produces or agrees to admit in their software. Moreover, consumers can’t be sure that they receive products of the highest quality, i.e. the lack of competition and the desire of Microsoft to prevent products of other companies to appear on the market do not permit to chose between the best products but, basically, clients had to or it’s better to say they are forced to buy Microsoft’s operating systems and other software which are very often preinstalled on PCs.

Finally, one of the most important and dangerous demerits of Microsoft’s monopoly is to my mind the prevention (unconsciously or not) of innovation growth. The company, in its struggle with rivals, tries to retard an introduction of any new innovative product of its opponents. Microsoft does it in different ways and retarding of innovation is caused not by the lack of ideas or people who generate these new ideas but the main cause is the lack of information for public does not have access to it that could help to develop new trends and elements of software. In general, Microsoft and its partners thoroughly conceal that sort of information from the public eye.

As a result, conclusions of court cases against Microsoft’s monopoly underline the violence of antitrust law in its structure. For example Judge Thomas Penfield Jackson came to the following conclusion: “Microsoft enjoys so much power in the market for Intel-compatible PC operating systems that if it wished to exercise this power solely in terms of price, it could charge a price for Windows substantially above that which could be charged in a competitive market… First, Microsoft’s share of the market for Intel-compatible PC operating systems is extremely large and stable. Second, Microsoft’s dominant market share is protected by a high barrier to entry. Third, and largely as a result of that barrier, Microsoft’s customers lack of commercially viable alternative to Windows.” (Finding of fact, 33-34). Then he also emphasizes how harmful such a system is for consumers: “Many of these actions have harmed consumers in ways that are immediate and easily discernible. They have also caused less direct, but nevertheless serious and far-reaching, consumer harm by distorting competition… Microsoft’s past success in hurting such companies and stifling innovation deters investment in technologies and businesses that exhibit the potential to threaten Microsoft. The ultimate result is that some innovations that would truly benefit consumers never occur for the sole reason that they do not coincide with Microsoft’s self-interest.” (Finding of fact, 409-412).

Thus, the facts mentioned above prove that Microsoft operating systems and accompanying software cannot occupy the dominant position on the market any longer. Rivals and growing demand of progress and changes force governments of different countries to eliminate the monopoly of Microsoft in this domain. The development of new technologies and a growing role of Internet which tend to open standards make it highly important to make operating systems universal or, at least, more flexible and adoptable with different, non-Microsoft software. It becomes evident that the development of mobile phones industry as well as wireless applications made a great step forward and the methods to which Microsoft gets used to are nowadays unacceptable and had to be changed. That means that the market of operating systems in first turn should be more liberal and tolerant in order not to interfere into the process of development and also any innovative initiative should be stimulated and implemented as soon as possible regardless to the company working on it.

Finally, the Microsoft’s and its partners’ attitude to the access to information must be reevaluated in terms of making it less difficult and practically possible because nowadays the main problem is not the lack of ideas but mainly the lack of information which could help to implement them in life. That is why Microsoft, being probably the most powerful company in the domain of high technologies, should not only invade new markets but let other companies to share their own part of the market. Only this can reduce that harm caused by Microsoft’s monopoly to consumers and its rivals and alternatives to its products will stimulate the development of new technologies and innovations in operating systems and other software production.

Article source: Expert Articles