NetNews Usenet Archive 1992 #31/NN_1992_31.iso/spool/comp/os/os2/advocacy/10982

Internet Message Format | 1992-12-22 | 3.7 KB

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Path: sparky!uunet!spool.mu.edu!yale.edu!yale!gumby!wmichgw!x90wardell
From: [e-mail]
Newsgroups: comp.os.os2.advocacy,comp.os.ms-windows.advocacy
Subject: Re: Is Microsoft the next Standard Oil?
Message-ID: <[e-mail]>
Date: 27 Dec 92 19:17:05 EST
References: <[e-mail]> <[e-mail]> <[e-mail]> <[e-mail]> <[e-mail]>
Organization: Western Michigan University
Lines: 60

In article <[e-mail]>, [e-mail] (Randall A Helzerman) writes:
> In article <[e-mail]>, [e-mail] (Jeff Sicherman) writes:
>
> |>   And supposedly Standard Oil (back in the late 1800's) found their oil
> |> fair and square. However, the marketing practices they followed and the
> |> restrictive covenants they imposed on their distributors and sellers
> |> were anti-competitive and the general vertical control they exercised
> |> over the whole system was deemed unhealthy for the consuming public.
>
> OK, I really didn't want to address the Standard Oil strawman, but I'll
> go into it anyways.  Here are some facts which your (probably goverment
> owned and operated) school didn't tell you about Standard Oil.
> Source: "Antitrust & Monopoly: Anatomy of a Policy Failure" by Dominic
> Armentano:
>
> Standard Oil never was a monopoly.  It reached its biggest market share in
> 1890 with 88% of the petroleum product market.  Not even the great John D.
> Rockafeller himself could turn Standard Oil into a monopoly.
>
> It wasn't until 1907 that suit was brought against it for its failure to
> comply with the Sherman antitrust act.
>
> And it wasn't until 1911, 21 years later, that it was finally convicted
> of being a monopoly.
>
> In the meantime its market share had fallen from 88% in 1890 to only
> 66% in 1911.  Standard Oil was never a monopoly, and in fact in the 21 years
> between 1890 and 1911 it had a steadily decreasing market share.  Why?
> Not because of antitrust laws--there were none.  Because of competition
> from small companies like "Gulf" and "Texico".
>
> The antitrust laws were passed under the guise of protecting consumers from
> big evil rapacious business, but the true motivation was jealously on the
> part of the companies who couldn't compete.
>
> We need fear Microsoft becomming a monopoly no more than we needed to
> fear Standard Oil.  History clearly shows that the free market was
> working to reduce Standard Oil's market share.  And if we don't use the
> FTC as a club to beat Microsoft into the ground, history will again show
> that the free market in computer software will work fine too.

    Let's go with your logic and say that Standard Oil was not
a monopoly.  Let's say it existed today and only controlled 60% of the
market.  60% of a multitrillion dollar market is frightening.
    Let's change the situation to be more like the Microsoft situation,
let's say that not only did Standard Oil control 60% of the market but
they also made all the drilling equipment that could be had.  While
standard oil did not have  a virtual lock, controlling more than half
of the largest industry on the planet (larger than the car industry, larger
than anything) is frightening.  Now, software is small time in comparision
but in the next century, software will probably grow to one of the
top 5 or so industries in the world, any company that controls the
operating systems as MS obviously does should not be allowed to have
such a huge applications market share.  I am not a competitor of MS by
any means it is just common sense.

                        -Brad