appealing to their needs. Seven years ago the Federal Trade Commission began its investigation of Microsoft's market power in the sale of operating systems for personal computers. That investigation was later joined by the DOJ and pursued vigorously by Anne Bingaman, then head of the Antitrust Division. The DOJ uncovered one practice it deemed worthy of challenge. Microsoft licensed its Windows software for multi-year periods on a "per processor" basis. Which means that, Microsoft, to help prevent software piracy, insisted that computer makers pay a royalty to Microsoft for each computer they shipped, whether or not Windows was installed as the operating system. DOJ was not persuaded by Microsoft's argument that physical machines can more easily be counted than intangible copies of computer software. Nor was DOJ convinced that customers might actually favor long-term contracts to guard against unpredictable price increases and other uncertainties. This raised the question; did Microsoft exploit its dominant market position by "insisting" on "unfair" licensing arrangements? Of course not. Consider that Windows became the industry standard because PC-makers thought it was a "superior" product. An assessment that surely took into account the entire set of product features, not only technical features but also ease of use, quality, price, service, and contract terms. Just like any other product in the competitive market. Consider that there were no barriers that would prevent another competitor from driving Windows out as being the market leader. These are simple conditions that exist in an economic market. Those considerations, apparently, did not impress the DOJ's Antitrust Division. After a five-year investigation costing millions of dollars, the Antitrust Division found little that could be characterized as anti-competitive. But that did not stop the government. Not only did DOJ file an antitrust suit that caused Microsoft to cancel it...
