Microsoft Being Microsoft Yet Again: Or, THIS is the Reason Microsoft Should Have Been “Broken Up” in the 1990s

Source: http://answers.google.com/answers/threadview/id/766881.html

MONOPOLY. Definition = a company or group having exclusive control over a commodity or service.

I just want the definition of a “monopoly” established at the outset. Microsoft and its many American fans would have you to believe the Microsoft isn’t a “monopoly.” Their argument, tenuous as it is, is that there are always other players in whatever market they dominate/want to dominate. Apple in the computer market/operating system market, Sony in the video game market, Chrome/Firefox in the browser market, Google in the Search Engine market, etc. and etc., ad naseum. There is always supposed competition in that market (even when there really isn’t). Let’s be absolutely clear: Microsoft is a monopoly and it uses its monopoly advantage to destroy competition in a market that it decides it wants to dominate to detriment to consumers.

I wrote a blog entry that Microsoft has projected a different “corporate image,” but that underneath, it is the exact same corporate culture practicing the exact same anti-competitive practices as always, and the recent acquisitions of Bethesda and Activision simply prove my point, no matter what their vaunted “marketing department” says about the company. The old adage proves true once again: if you want to know about a person (or in this case a company), watch what they do, not what they say.

Windows (Where is the Competition?)

Go to your local Target, Walmart, or other retailer and try to buy a PC with a different operating system other than Windows and report back when you do. Notice, I said, a PC, not a Chromebook, which runs on a different (much lower spec system than a traditional PC), nor did I say an Apple computer, which like a Chromebook, is its own separate classification of machine (just on the higher end typically). No, I said a PC. I’ll wait . . .

Still waiting . . .

And I could keep this going, but the realistic fact is, you can’t. Oh, if you know someone (or know how), you can use speciality OSs like Ubuntu and Linux, but in day-to-day reality, if you’re buying a PC, then you’re buying a computer running Windows for which Microsoft has been paid a licensing fee by the PC manufacturer, which has probably been passed to you, the consumer, in the purchase price of the machine. Now, multiply that buy how ever many PCs (not Chromebooks/Macs) are sold each year all around the world and you have 1) a de facto monopoly and 2) a revenue stream that completely dwarfs the GDP of many 3rd World Nations (Source: https://www.visualcapitalist.com/the-tech-giants-worth-compared-economies-countries/). And Microsoft knows that Chromebooks and Macs aren’t equivalent products to Windows (they don’t compete for the same customer base usually), but it has lobbying power to convince many techno-illiterate lawmakers otherwise who only see a computer as something with a screen and keyboard and who don’t understand the nuance behind it all.

Thanks to this de facto monopoly status, Microsoft has far more money than it should because there’s no real competition in its marketplace. If there was a, I don’t know, call it a “Portal OS” for lack of a better example, that controlled 40% of the operating system market, then 1) Microsoft’s profits would be far less because 40% of it would be going to another company and 2) Microsoft would have spend more money on R&D to keep their lead and stay ahead of “Portal OS” and not let them gain even more marketshare. Returning to the same example with Sony, for a moment, we see that in the TV space where Sony competes, there’s LG, Samsung, and Song, not to mention the TCL and Hisenses of the world. Windows has no real competition and it lets Microsoft get away with things that it normally wouldn’t be able to due (Microsoft Cloud Services, Gamepass’s low price subsidies, purchasing Bethesda and Activision, for example).

Bethesda and Activision

Why are these bad for consumers? Microsoft has the (ill-gotten) money, after all. These are bad for consumers because it removes choice from the equation for the consumer. If you want these brands that were once available to both/multiple consoles, now you have only one choice. You remove competition (the very life-blood that Americans say makes our capitalist system the best choice). See, we Americans want competition as it makes companies compete for our dollars and makes products better, until we rally around 1 dominant team/company/thing that we see as a “winner.” Once we’ve identified a “winner,” then all pretext of fairness goes out the (pardon the pun) window, and we back that one, even if it HURTS us in the long run.

Here, there’s no competition happening with the purchase of Bethesda and Activision. We have 1 winner: Microsoft and 3 losers: 1) Sony 2) Nintendo and 3) Competition. The only way for Sony and Nintendo to fight this move is to 1) retaliate in kind with other consolidations, forcing fewer and fewer choices on the consumer or 2) ignore Microsoft and hope that their own moves will be sufficient. At no point is the consumer served with less choice.

Now, I can already see some of my Microsoft X-Box adherents warming up their keyboards about Sony’s exclusive first party games. The difference there is that Sony had expend time, resources, and talent to create those games, market them, all under the pressures of competition in Sony’s respective markets. Sony doesn’t have/didn’t have a monopoly to gather unlimited resources; per my point with Windows, Microsoft did. Sony is, to use an Americanism, “succeeding while playing by the rules” in a market economy. Great games people want to play while having to compete in its various industries. Microsoft, not so much. Thanks to all the money its been able to wrack up year after year without a robust competitor, it can simply “cherry pick” and buy what’s hot/best without having to do any work. Microsoft is essentially given a “free pass” in the American market system while Sony has to fight on ALL FRONTS and then create a compelling game; Microsoft only has to see someone else develop a compelling game and say, “right, thanks to our pot on (again, pardon the pun) “Monopoly money,” we’re going to acquire that.”

Internet Explorer . . . Oops, I Meant Internet “Edge”

Now, we’ve already seen what happens when Microsoft comes to dominate a product category. In the mid to late 90s, everyone thought that the browser would be the ticket to internet dominance, not the search engine. Netscape Navigator was the king of the browsers and ran just fine on Microsoft Windows. However, Windows decided they wanted to be king of the browser space and leveraged their position as, say it with me, a monopoly, to bundle Internet Explorer in with every copy of Windows, thereby killing off Navigator and other Window-based browsers for a time. However, when it became clear that 1) Microsoft was number 1 in the browser wars and 2) that internet dominance would be fought in the realms of the search engine, Microsoft let IE languish. It was completely moribund product for several years until Chrome and Firefox came back on the scene, pushing the browser forward from Microsoft’s uncaring snubbing of their own number 1 product. A few years ago, IE was “retired,” and Microsoft “Edge” took its place. However, since it is no longer interested in “the browser wars,” Microsoft has chosen not to expend capital (i.e., money) to purchase ANY major browser technologies to push past its rivals. It is content, again because there’s no interest in the company in being number 1 in the browser category, to let both Firefox and Chrome claim the lion’s share of the browser market. It doesn’t have to “compete” in that market (no money/prestige to be gained), so it chooses to sit on the sidelines while other companies innovate. Because it is a monopoly, it doesn’t HAVE to expend resources, where another company (like Sony) who is competing has to compete in every market category it is a part of (video games, TVs, VR, headphones) or risk being overwhelmed by its competition. For example, Sony did the first lower priced VR headset and while it did well, wasn’t as well regarded as its more expensive (& feature rich) PC competitors. Rather than give up on the category (a la Microsoft with Internet Explorer or Zune or any of a number of failed Microsoft products/initiatives that I could name), Sony has had to spend time, resources, and money to create a successor product that seems to be more in line with what consumers value. Microsoft either buys a company in order to compete or it leaves the category all together.

The Media and Congress Should Know Better

In closing, I fault much of this on the American media and the American congressional system. Yes, Microsoft’s lobbying efforts and marketing are legion, but neither the media nor congress has done their jobs.

The media, instead of investigating and talking about these issues, act very much like cheerleaders and marketing arms for Microsoft. I hate to call out news organizations, but the video game arm of Forbes in particular, is one such outlet that I have to call out. I’ve regularly read their coverage on the video game industry for the past 2 years or so via their inclusion with the “Playstation News feed” on Google. I’ve found that they regularly act as a “cheerleading” arm for Microsoft with coverage that tend to favor Microsoft and whenever Sony is deigned to be mentioned, it is usually backhanded a best and downright negative at worst–so much so, that I’ve stopped reading them and I no longer consider them a credible/unbiased resource (at least for video game coverage). There are several other major organizations who should be looking at with a more jaundiced eye at this deal, but only a few are: Digital Trends for example. Why, I wonder, is Digital Trends doing the work that Forbes should have done? Even The Motley Fool seems to be more interested in the money/company strategies than Forbes is with this story and about Microsoft in general. Now, Forbes isn’t the only guilty party in terms of cheerleading rather than actually presenting news about Microsoft in an unbiased way–there are quite a few publications and outlets who have been gulled by Microsoft’s money, influence, and power, the same company, by the way, who only a few short years ago ticked them all off with their disastrous and abortive Xbox One strategy. Now, however, a few years of Gamepass (which is STILL $14.99 a month = $179.88 a year, I might add, which is over $350 for 2 years, closing in on the price a console or a budget TV, by the way), a couple of high profile acquisitions, and all these outlets are ready to bow down at the alter of Microsoft.

In Closing

“Major” PC Operating System(s): Windows

Game Engines: Unity, Unreal, CryEngine 3, IDTech, Luminous, Frostbite, etc.

TV Manufacturers: Sony, LG, Hisense, TCL, Samsung, Vizio, Panasonic, etc.

Phone Manufacturers: Samsung, Apple, Xiaomi, Huawei, etc.

“Major” PC Operating System(s): Windows

Again, the criteria here isn’t that there aren’t other operating systems, but rather, are there viable alternatives that you can go to a store and buy? Can you get an OS on PC that you purchase in general circumstances, Walmart, Bestbuy, etc. that you can generally walk in and buy. Both Chrome OS/MacOs requires purchase of a particular type of hardware and, in general, Linux requires you to put it on your system after purchase or during a “build.” In reality, there’s only 1 operating system for PCs and as the definition above states: 1 = a monopoly.

While I have no illusions that Microsoft will ever be broken up (we Americans no longer have the stomach for such things now that “business people” have inculcated themselves in the American political landscape), but at least there are still people in America who aren’t Microsoft cheerleaders and are willing to at least “question” the legality of Microsoft’s moves, even if it will (most likely) come to nothing: https://www.washingtonpost.com/politics/2022/01/19/microsoft-has-avoided-hot-seat-years-its-new-mega-deal-may-change-that/.

Microsoft’s recent moves are nothing short of using its lack of competition to its advantage. Now, business is business, but I have to question this fact: if competition makes it better for the consumer, why is no one questioning the lack of competition that Microsoft has in its PC Operating System and why is no one questioning how the money/revenue/profit is being used. I’m going to end this post with the words of Jesse Lennox from Digital Trends:

“Games have already been feeling less risky and exciting with development taking more time and money than ever before. Bringing more studios under a single roof is only going to exacerbate this stagnation. I pray this is the last acquisition we see Microsoft make, but can’t realistically think it will be. Until it risks an actual monopoly, it’s going to keep pushing. It probably won’t be in the next couple of years, but the repercussions of this deal are coming — and I don’t think we’re going to like them.”

Jesse Lennox (https://www.digitaltrends.com/gaming/microsoft-activison-blizzard-monopoly/?utm_campaign=169212_Editorial_Decrypted_01192022&utm_medium=email&utm_source=dotdigital&dm_i=6MG2,3MKC,1335D0,H540,1)

Amazing what insights a real journalist can come up with when that person is actually not cheerleading for a particular “side.”

Sidney

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