Volume 27 (2004) / Issue 4
The recent decision issued by the European Commission against Microsoft raises legitimate concerns in many respects. Firstly, the way the Commission handled the proceeding highlighted the impasse that characterises antitrust authorities when dealing with complex cases from the high-tech world. Secondly, the Commission adopted an incorrect approach to interoperability, confusing it with perfect emulation of Microsoft’s copyrighted source code. Thirdly, the Commission showed little or no attention to the economics of technological leveraging in dealing with the media player market, and ended up awkwardly mimicking the rationale upheld by the US District Judge in the "browsers war". We conclude by calling for more sound economic analysis at the European Commission, and suggesting solutions which would significantly improve the level-playing-field in the server software and in the media player markets without hindering incentives to invest and consequently stifling innovation.
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