An antitrust line in the sand

Microsoft has threatened to withdraw Windows from South Korea if forced by antitrust authorities to redesign it. If necessary, I hope they do, as it's a principle worth defending.

Microsoft has suggested that they would withdraw or delay future releases of Windows if Korean antitrust authorities order them to redesign their products.

Now, many of you know that I take a dim view of antitrust. I would have as much a chance of overturning conventional wisdom in this area, however, as a 1970s Ford Pinto would have of winning the Indy 500. So, I offer "alternatives" to fans of antitrust, and offer Kollar-Kotelly's ruling as Exhibit A in a case for the right way to approach antitrust. Don't think markets can sufficiently tame the power of large, dominant companies? Fine. Limit their ability to use market power by, say, preventing them from writing exclusive distribution deals with vendors of portable music players (Microsoft was duly spanked for that). Don't, however, step over the line and start making design decisions for software companies. Know your limits, and a safe path through the valley of the shadow of antitrust can be navigated.

I hope that the Koreans will follow that model. Given that Microsoft felt it necessary to threaten the nuclear option, though, it sounds like they might not. Should Korean authorities step over that line in the sand, I HOPE Microsoft has the courage to stick to their guns and follow through on their threat. This is a principle worth defending, in my opinion, because government shouldn't be in the business of designing software - period. Giving consumers extra options in Windows is very different than making it so that those consumers can't use any other option. The former merely provides another choice (albeit an ubiquitous one, at least for a particular version of Windows), while the latter prevents it.

Some of Microsoft's opponents hope so, too, thinking that withdrawing Windows will boost alternatives such as the Mac or Linux. I wouldn't be so sure, though. There is demand for Windows in South Korea, whether it's consumers who run the operating system on their computers, consulting companies that cater to it, or software vendors that write product for it. That demand isn't going to evaporate should Windows be pulled suddenly from the market.

Consumers will find ways to feed their demand when forced to do so. Consumer ability to work around governments trying to prevent them from doing things they want to do is well documented (and in some cases, the thrill of working around obstructions seems to boost usage), and serves to demonstrate that governments have less power than they like to think they have. Of course, a black market for Microsoft software is likely to be of the pirated variety, so the nuclear option will cost Microsoft money. On the other hand, it's not likely to make Linux a very appealing option if the cost differential gets erased because of a tug-of-war between Microsoft and antitrust bureaucrats.

It could also backfire on Microsoft, assuming they lose a public relations battle and are depicted as the evil American company trying to destroy the Korean marketplace. Should Microsoft choose the nuclear option, they would have to spend money making the case that they are defending the principle that any citizen or group of citizens has the right to control the design of their own products.  Koreans wouldn't want American antitrust authorities dictating design decisions to Samsung.

The principle is worth defending. Whether or not Microsoft has the resolve to defend it is another question.

...and by the way, this is MY opinion, not Microsoft's. I WORK for Microsoft.  I am NOT Microsoft.