From: sjb5@ns1.cc.lehigh.edu (STACY JOHN BEHRENS)
Newsgroups: comp.os.os2.advocacy
Subject: Re: Is Microsoft the next Standard Oil?
Date: 23 Dec 92 03:01:33 GMT
Organization: Lehigh University

In article <1992Dec22.113330.22921@noose.ecn.purdue.edu>, helz@ecn.purdue.edu (R
andall A Helzerman) writes:
>In article <Bzn0EI.D2w@csulb.edu>, sichermn@csulb.edu (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.

A monopoly doesn't need to be 100% in real life.  True that would be a
technical definition, but the effect is that a company with such overwhelming
market share gets to call the shots.

>
>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.

1911 isn't 21 years after 1907.  I assume this is a typo.
>
>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".

Again, 100% is not required to achieve what amounts to a monopoly in real life.

>
>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.

And they should be squashed out of existance.  I don't see how the government
limiting the growth of a big company is worse moraly or economically than the
big company squashing a little company.  Standard Oil *did* engange in
practices that not only tended to promote their becomming a monopoly, but
practices which hurt competition and were in no way, shape or form moral.

>
>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.
>

You seem to neglect the point that Standard Oil had to straiten out their act
in order to keep the government off their back as much.  A change in tactics,
can often reduce market share and this was apperently no exception.  We always
need to worry about one company potentially hurting our economy.  In some
cases a monopoly isn't the worst thing to have.  In other cases it is.
Software is one of the cases where something even approaching a monopoly is
usually a bad thing.  Software isn't like a car or salt or other commodities.
If you don't like a car, you aren't tied to a particular type.  If you wan't
software though, you are usually limited to some degree, by what you already
have.  A monpoly would be the worst thing that could even happen to the
computer industry and we most certainly need to worry about it happening.

-- 
Stacy John Behrens
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The only justification for our concepts and systems of concepts is that they
serve to represent the complex of our experiences; beyond this they have not
legitimacy.                                  [Albert Einstein]
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