[Congressional Record Volume 146, Number 8 (Thursday, February 3, 2000)]
[Senate]
[Pages S325-S326]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     MICROSOFT AND THE AMICUS BRIEF

  Mr. GORTON. Mr. President, this is an appropriate time to bring my 
colleagues up to speed on the continuing saga that is the Microsoft 
anti-trust trial. Since I last came to the floor to discuss this issue, 
the industry, of which Microsoft is a part, has once again changed 
dramatically. For instance, American Online recently triggered the 
largest corporate merger in history with the acquisition of Time-
Warner. This media giant is now poised to compete vigorously in every 
aspect of the Internet, from the wires that connect you, to the content 
you watch. To meet this challenge, Microsoft and a legion of its 
competitors must be allowed to compete vigorously in the ever-changing 
landscape of the information technology industry.
  My fellow Senators will soon receive a ``dear colleague'' letter 
endorsing an amicus brief filed on behalf of Microsoft by the 
Association for Competitive Technology (ACT). ACT is a nonprofit 
association representing more than 9,000 companies in the information 
technology industry. ACT's membership is made up mostly of small and 
medium sized businesses but includes household names such as CompUSA, 
Excite at Home, Intel, Microsoft and Symantec. These members come from 
all walks of the industry, unified by the cause of protecting 
competition and innovation in the industry.
  This brief was prepared by a bi-partisan group of legal heavyweights 
including former White House Counsels Lloyd Cutler and C. Boyden Gray 
as well as former Attorneys General Griffin Bell and Nicholas 
Katzenbach. It eloquently reinforces many of the points that I have 
made on the Senate floor for over a year now. In the end, I think you 
will agree that this document reveals the glaring weaknesses in the 
DoJ's case against Microsoft.
  The amicus brief reinforces the point that current antitrust laws 
expressly allow, and even encourage, the kind of competitive activity 
that the government seeks to stop; the kind of competition that 
continues to benefit not only consumers, but the hundreds of thousands 
of high-tech workers and entrepreneurs in the software and hardware 
industries as well. It also sounds the familiar refrain that the 
government needs to take a highly pragmatic and cautious approach to 
antitrust enforcement in this dynamic industry.
  Unfortunately, Judge Jackson found last year that Microsoft's Windows 
holds a lawfully acquired monopoly of the market for ``operating 
systems'' for Intel-compatible personal computers. Although Microsoft 
may later challenge this finding, the brief assumes for purposes of 
argument that the finding is correct.
  The plaintiffs (the federal government and several states) charge 
that Microsoft, in adding the Internet Explorer browser to Windows and 
marketing the package, violated antitrust laws. The amicus brief--and 
the Supreme Court cases on which it relies--demonstrates that the 
purpose of the antitrust laws is to protect consumers and competition--
not competitors--and that Microsoft, far from violating the antitrust 
laws, competed vigorously to the immense benefit of consumers.
  Vigorous competition, which antitrust laws are designed to protect, 
produces innovation, better products, more efficient distribution, and 
lower prices. All of these results of competition are to the benefit of 
consumers. The antitrust laws do not require competing firms to be nice 
to one another, or protect firms against their more powerful rivals. It 
is not wrong for any company to want to take business away from its 
rivals.
  The antitrust laws encourage a firm that holds a lawfully acquired 
monopoly to compete hard to keep that monopoly. They also encourage 
such a firm to enter other fields where, by competing with better and 
cheaper products, it can benefit consumers.
  Judge Jackson found that the widespread use of the Windows operating 
system has made it is a platform for a vast range of computer 
applications that consumers now enjoy.
  Judge Jackson also found that when Microsoft added a superior 
Internet browser (Internet Explorer) and offered it to consumers at no 
extra charge, these actions gave consumers better access to the 
Internet and spurred its rival Netscape to improve the quality of its 
``Navigator'' browser and to distribute it at no charge.
  Microsoft did not drive Netscape's Navigator out of the browser 
market. On the contrary, even Judge Jackson found that Netscape's 
``installed base'' has more than doubled since 1995 and will continue 
to grow in the future. Browser competition remains vigorous.
  Microsoft did successfully break into the browser market and did 
obtain a share of that market for itself. The single most important 
reason, as even Judge Jackson found, is that Microsoft rival AOL itself 
chose and re-chose Internet Explorer over Navigator, even though AOL 
now owns Netscape. AOL made that choice because Microsoft offered a 
better product, better service, and better marketing support than did 
Netscape.

  Microsoft's agreements with PC manufacturers and Internet access 
providers to distribute Internet Explorer were lawful agreements 
designed to help Microsoft break into a browser market in which 
Netscape was the overwhelmingly dominant firm. It was good for 
competition and consumers, for Microsoft to introduce competition into 
that market.
  The plaintiff's theory is essentially that Microsoft, once it had a 
lawful monopoly in the operating systems market, should not have 
aggressively entered the browser market, because Netscape's dominance 
of that market might have led to more competition in operating systems. 
That theory is bad law. Again, the law protects consumers, not 
competitors. Consumers benefit when any firm, including one holding a 
lawful monopoly, competes aggressively to challenge another firm's 
incipient monopoly in a related field.
  This competition helped usher in the most important change occurring 
on earth today. The power of information has been taken from a few 
large centralized institutions and put directly into the hands of 
people in every town and village across our globe via the Internet.
  Not only is the number of users increasing exponentially, but the 
amount of information available to them is also growing at an 
unprecedented rate. The International Data Corporation estimated the 
number of web pages on the World Wide Web at 829 million at the end of 
1998, and projects that the number will be 7.7 billion by 2002.
  The explosive growth of the Internet will eventually have a 
fundamental impact on every aspect of American life, and will introduce 
a vastly different landscape in high-technology than exists today. 
Users will not necessarily

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use stationary personal computers to access information, but instead 
rely on Web phones, palmtop computers and similar technology that is 
developing at an exponential rate. Microsoft must be allowed to compete 
in order to survive this transition.
  Although Microsoft is a large and powerful company, it faces 
aggressive present and future competition in every field it enters, and 
if it wants to maintain its present position it must compete vigorously 
on every front, with innovations, improved quality and lower prices. 
That is exactly what antitrust policy seeks to promote.
  For a court to enter into this vitally important and rapidly changing 
field and seek to dictate what products shall be made and sold by which 
firms would be a tragic mistake. For example, if a few years ago a 
court had ordered Microsoft not to add Internet Explorer to Windows, 
there would today be fewer hardware manufacturers, fewer software 
developers, fewer applications, and a far less developed Internet, and 
the world would be a poorer place.
  The best solution for both the administration and the courts is to 
retire from the field and to allow the most dynamic company in the 
history of technology to continue its growth in a competitive market, 
free from government interference.

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