For years, Bill Gates’s company had been making things for a dollar and selling them for ten dollars, thereby demonstrating the vast potential for any company that could combine digital technology with market power. Both Microsoft Windows and Microsoft Office benefited from economies of scale and monopoly positions. Once they had been developed, the cost of replicating them and putting them on CDs was negligible. Yet Microsoft was able to charge hundreds of dollars for some versions of Microsoft Office, having seen off most of its competitors.
