The Flawed Fragmentation Critique of Structural Remedies in the Microsoft Case

31 Pages Posted: 31 Jan 2000  

Robert J. Levinson

Charles River Associates

R. Craig Romaine

Charles River Associates

Steven C. Salop

Georgetown University Law Center

Date Written: January 2000

Abstract

Among the proposed remedies in the Microsoft case are structural remedies that would create competition in operating systems for personal computers. One criticism that has been raised against such remedies is that they would lead to "fragmentation" of the Windows standard. According to this critique, the remedy would lead to a number of radically different and incompatible operating systems. As a result, these remedies would impose expensive porting costs on applications developers, leading to higher costs and less product variety for consumers. This paper examines the "fragmentation" hypothesis and concludes that fears of fragmentation and high porting costs resulting from Windows competition are unwarranted. The competing operating systems created by an effective structural remedy will start from the same code base and run on the same hardware platform, thereby reducing porting costs. In addition, the operating systems competitors will have the incentive to maintain backward compatibility and compatibility with each other, which will serve to reduce porting costs. Finally, porting costs can be reduced further by cooperation among the operating systems competitors. The cost of porting from one operating system to another will be far smaller than from the Windows operating system running on an Intel microprocessor to a new operating system running on a different microprocessor.


Other papers related to the Microsoft Case:

"Creating Competition in the Market for Operating Systems: A Structural Remedy for Microsoft"
by Thomas M. Lenard.

"A Fool's Paradise: The Windows World After a Forced Breakup of Microsoft"
by Stan J. Liebowitz.

"Breaking Windows: Estimating Some Costs of Breaking up Microsoft Windows"
by Stan J. Liebowitz.

Our database includes more than 20 other papers about the Microsoft case. To find them, please use an "abstract body" search,. and enter "Microsoft" as the search term.

JEL Classification: K21, L4, L5, O3

Suggested Citation

Levinson, Robert J. and Romaine, R. Craig and Salop, Steven C., The Flawed Fragmentation Critique of Structural Remedies in the Microsoft Case (January 2000). Georgetown University Law Center, Business, Economics, Regulatory Law Working Paper No. 204874. Available at SSRN: https://ssrn.com/abstract=204874 or http://dx.doi.org/10.2139/ssrn.204874

Robert J. Levinson

Charles River Associates ( email )

1201 F. St. NW
Ste. 700
Washington, DC 20004
United States

Robert Craig Romaine

Charles River Associates ( email )

1201 F Street, N.W.
Suite 700
Washington, DC 20004
United States
202-662-3814 (Phone)
202-662-3910 (Fax)

Steven C. Salop (Contact Author)

Georgetown University Law Center ( email )

600 New Jersey Avenue, NW
Washington, DC 20001
United States
202-662-9095 (Phone)
202-662-9497 (Fax)

Paper statistics

Downloads
622
Rank
33,197
Abstract Views
3,855