May 17, 1998

Bill is Right

Why is it hypocritical? At the center of the anti-trust logic is the contention that MS uses its virtual monopoly on operating systems to take out competitors in other areas. But lets look at that argument more closely.

There are many examples of companies holding complete or near monopolies taking out competitors. The fact that my new Chrysler mini-van comes with a particular brand of stereo blocks other manufacturers from competing for my stereo business. After all, why buy a third-party add-on stereo when the one that came with my van is just fine and is included in the price of the van?

Now one could argue that many manufacturers bid on this business and therefore it is not analogous to the Microsoft situation (since MS puts its own products in its OS). But it's generally the case that the auto companies own a large share of the electronics companies they use as a source for their stereos.

Not only that, but the auto companies own rental companies. I can't rent brand X car at rental company A because brand Y auto company owns company A and therefore A buys only Y's cars. If you don't think this matters, consider that the Ford Taurus held its "best seller" status for several years primarily because of sales to Ford's own rental subsidiary. Not only did Ford keep that rental company from buying other cars, but the apparent popularity of the Taurus increased sales to the unaware.

The fact of the matter is that a web browser is a utility. It's a file viewer. It's no different than the "QuickView" utility that ships in Win95 that lets you view files of different types. Companies that manufacture utility software understand that utilities eventually get sucked into primary products and its time to move on. If Netscape realized that they would have been pursuing some other technology (streaming audio/video, commerce solutions, etc.) instead of putting all their emphasis on their browser utility.

The other difference between these two companies is that MS believes in market freedom while Netscape is depending on the government. Government intervention in a free market system  never results in anything but disaster. Just as we've raised several generations now of welfare-dependant Americans, Netscape would have us raise a generation of welfare-dependent companies - companies that can only compete with government support.

Ignorance is Bliss

At the heart of the problem with these suits is the sheer ignorance of the attorneys general who bring them. None of these guys or gals could code his or her way out of an 8-bit processor, yet they claim to know enough to determine that Microsoft's contention that the browser is an integral part of the operating system is not true.

Attorney General Janet Reno: "The Internet is an immensely popular medium for communication, commerce, and the information flow of the 21st century. No firm should be permitted to use its monopoly power to develop a chokehold on the browser software needed to access the Internet." This statement is so stupid that to attack it seems unkind - I mean, we all teach our kids not to taunt the mentally or physically handicapped. But in this case, she stepped into my world and claims to know the rules.

First, "browser software" is not needed to access the Internet. Accessing the Internet is done at the network level in the operating system. My Win95 machines speak TCP/IP over dial-up Internet connections. Microsoft provides that connectivity at no additional charge and with no restrictions to its competitors. Check out your copy of Netscape: Is it dialing into the Internet using Win95 Dial-Up Networking and your Microsoft-provided copy of winsock.dll? Yes? That doesn't sound like a "chokehold" to me.

Second, Microsoft provides a DOS-based FTP client as part of Win95. Anybody complaining about that? FTP is an essential function on the Internet. I don't hear any of the FTP client manufacturers complaining. Could it be that this really isn't an issue of monopoly giant vs. the little guy but rather liberal weenies at Netscape crying about their lack of marketing savvy and appealing to the government to bail them out?

Third, the most popular Internet application is email. Eudora is probably the most popular email client. Outlook and Outlook Express are right in there, but so are a dozen other products. That doesn't sound like a choke-hold.

Fourth, while many believe the Internet is "important" the reality is that very few people use it. Further, to declare what the future holds with respect to computing technology is to put yourself on pretty shaky ground. I've been asked by one of the Christian magazines to talk about Bible software in 2010. I'm planning to talk about next year and maybe the year after that. But I can't go much past that. It would be insane. Yet Janet Reno enters into her psychic trance and predicts that the Internet will be "immensely popular" in the 21st century.

Let's think about that some more. One hundred years ago, the railroad was an immensely popular mode of transportation for those who wanted to get from New York to San Francisco without sailing around the southern end of South America. One hundred years ago, writing letters and postcards was an immensely popular form of communication. One hundred years ago, sitting in the parlor looking at stereo photos was an immensely popular pastime.

If Janet Reno had lived at the turn of the last century, she would have shut down the big railroads, taxed the postcard companies, and broken up the big stereo photography monopolies, all in the interest of protecting what were sure to be immensely popular forms of transportation, communication, and recreation in the twentieth century.

Finally, Justice is incredibly hypocritical in their application of anti-trust law. They permitted the merger of Intuit and Parsons Technology, which brought the #1 and #2 makers of personal tax preparation software together under one roof. Certainly taxes aren't going away in the near future, and the software to prepare returns has probably more direct impact on people's lives than web surfing currently does. Yet Justice turned away on this merger. Intuit captured a huge percentage of that market, then shut down the competitor it bought. Predatory? I'll let you decide.

Gates has this right. It hasn't been until the last couple of years that anyone even knew what a browser was. To all of a sudden declare them essential to the US economy is nothing short of retarded thinking.

Was that "bridge to the future," Mr. President? Or "bridge to the führer?"

Bill Clinton is indeed blowing up the "bridge to the future" that he promised to build during the last campaign. This isn't about Microsoft and Netscape; it's about government control of free enterprise. And to be honest, I'd much rather trust Bill Gates to innovate and bring me the future than to be stuck with the kind of future that the other Bill is building for me.