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    GurmeharCheema
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    The document discusses two landmark anti-trust cases in the US - U.S. vs Alcoa and U.S. vs Microsoft. It summarizes that forcing Alcoa to sell its aluminum plants created a more competitive aluminum industry in the US. However, the effects of penalizing Microsoft are less clear, as technology has changed in ways not predicted and Microsoft has become less innovative since the case. While some argue competition increased, others believe Microsoft became less aggressive to the detriment of consumers. The document concludes that while the Alcoa case clearly increased competition, the decision to penalize Microsoft remains controversial.

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    Alcoa and Microsoft case

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    The document discusses two landmark anti-trust cases in the US - U.S. vs Alcoa and U.S. vs Microsoft. It summarizes that forcing Alcoa to sell its aluminum plants created a more competitive aluminum industry in the US. However, the effects of penalizing Microsoft are less clear, as technology has changed in ways not predicted and Microsoft has become less innovative since the case. While some argue competition increased, others believe Microsoft became less aggressive to the detriment of consumers. The document concludes that while the Alcoa case clearly increased competition, the decision to penalize Microsoft remains controversial.

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    © All Rights Reserved
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    171 views1 page

    Alcoa, Microsoft Effects

    Uploaded by

    GurmeharCheema
    The document discusses two landmark anti-trust cases in the US - U.S. vs Alcoa and U.S. vs Microsoft. It summarizes that forcing Alcoa to sell its aluminum plants created a more competitive aluminum industry in the US. However, the effects of penalizing Microsoft are less clear, as technology has changed in ways not predicted and Microsoft has become less innovative since the case. While some argue competition increased, others believe Microsoft became less aggressive to the detriment of consumers. The document concludes that while the Alcoa case clearly increased competition, the decision to penalize Microsoft remains controversial.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    of 1

    The U.S.

    governments decision to penalize Alcoa has definitely served to make


    Americas aluminum industry more competitive. The positive effects of punishing
    Microsoft for violating the governments anti-trust laws, on the other hand, are less clear.
    After Alcoa was forced to sell most of its aluminum plants to Kaiser and Reynolds, the
    U.S. was left with four major aluminum manufacturers- Alcoa, Alcan, Reynolds and
    Kaiser. To ensure that Alcoa did not re-monopolize the markets, the U.S. Department of
    Justice retained jurisdiction over the company until 1957 (Alcoa). By guaranteeing that
    Reynolds and Kaiser were allotted a larger share of market, the United States created a
    more competitive environment for aluminum companies to function. The increased
    competition ultimately allowed for easier entry into the industry. By 1958, three more
    companies, Anaconda, Orment and Harvey, had entered the American aluminum market
    (Alcoa). Thanks to government intervention, Alcoas monopoly had been dismantled,
    allowing for greater competition and efficiency. In fact, even Alcoa benefitted from the
    new state of affairs. As the American aluminum business flourished, Alcoas loss of
    market share was more than offset by increased demand for products. (Alcoa)
    Since U.S. vs. Alcoa happened half a century ago, the effects of that ruling are
    very clear. In the case of U.S. vs. Microsoft, however, it is more difficult to determine
    whether the governments decision made the American technology industry more
    competitive. On one hand, the Department of Justice has determined that the judgment
    protected the development and distribution of middleware including web browsers,
    media players and instant messaging software thereby increasing choices available to
    consumers. (Department of Justice) In much the same way that U.S. vs. Alcoa produced
    greater competition in the American aluminum industry, the Department of Justice claims
    that its actions prevented Microsoft from continuing its monopolistic behavior, increased
    competition and allowed for easier entry into the technology market. The government
    even goes as far as to claim that its decision helped create competitive conditions that
    enabled new kinds of products, such as cloud computing services and mobile devices, to
    develop. (Department of Justice)
    Although it is certainly true that companies like Apple and Google have thrived
    since the ruling, it is unclear whether their rise can be attributed to the governments
    decision to penalize Microsoft. Technology has developed in ways that could not have
    been predicted and the center of the governments argument against Microsoft- that its
    domination of the PC market stifled competition from other internet browser
    manufacturers- is largely irrelevant today. Some argue that the penalties imposed on
    Microsoft did not actually increase competition, but rather forced a once-innovative
    company to become a shell of its former self, to the detriment of consumers. Michael
    Cusumano, a professor at the MIT School of Management states that Since the antitrust
    suit, (Microsoft) has become much more cautious and much less aggressive. They're
    afraid, it seems. Whether it's antitrust in U.S. or in Europe, they seem to be slowly
    reacting to the world around them, rather than trying to get in there fast." (Seattle Times)
    Both U.S. vs. Alcoa and U.S. vs. Microsoft were landmark cases that had far-
    reaching consequences. Although hindsight allows us to look back and see that breaking
    up Alcoa ultimately increased competition and benefitted consumers, the decision to
    penalize Microsoft remains controversial.

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