(4 of 5)
Are lawsuits like this good for the country? To Microsoft's defenders, the answer could hardly be more self-evident. Bill Gates drops out of college to found a little start-up that, by his 44th birthday, has grown into the most valuable company in the world. His success ensures that the U.S. is in the forefront of a global technological revolution, and he produces a product admired and used by millions. His reward for living the American Dream? Some smart Washington lawyers try to brand him a lawbreaker.
The Freedom to Innovate crowd argues that by bringing lawsuits like this one, the government is meddling dangerously with private industry and, consequently, the health of the entire U.S. economy. The most extreme remedies, they say, are a clear intrusion--a judge's breaking up a company, or forcing it to share trade secrets with its competitors. But the milder ones--such as stopping a corporation from engaging in certain anticompetitive actions--may even be worse. "You'd have a judge in effect as CEO, micromanaging every decision," warns Jeff Eisenach, president of the conservative Progress & Freedom Foundation. "It's the first step down the slippery slope to government regulation of the computer industry."
Supporters of antitrust law argue that decisions like Judge Jackson's actually strengthen the free market. The new economy--and America's unprecedented run of growth and prosperity--has been fueled to a significant degree by small start-ups founded by entrepreneurs with big dreams. These are precisely the sort of companies that can be crushed most easily by a brutal monopolist. When antitrust law works right, it can give these enterprising small firms room to grow. "There are a lot of companies that have for years operated in absolute terror of Microsoft," says Sun's Morris. The ruling, he predicts, will prevent "the dead hand of Microsoft from stifling competition."
Well-executed antitrust lawsuits can energize broad areas of the economy. That's the lesson of the AT&T case. The Justice Department's suit against Ma Bell concluded in 1982 with a consent decree forcing it to spin off the seven regional Baby Bells. It wasn't a panacea, but it kicked off a process that dramatically increased competition and improved service. And the Baby Bells have carried their competition into new areas like cellular telephones and Internet access.
If high-tech needs smart antitrust enforcement, that raises an even trickier question: Is the American legal system up to it? The wheels of justice have always ground slowly--and even today the courts have more in common with Dickens' Bleak House than with the World Wide Web. By the lightning-paced standards of the computer industry, the law is positively glacial. After Jackson is done with the case, the appeals could drag on for two more years. That's a lifetime in Silicon Valley.