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Interoperability and market foreclosure in the European Microsoft case

Kuhn, Kai Uwe and Van Reenen, John (2008) Interoperability and market foreclosure in the European Microsoft case. Centre for Economic Performance special papers, CEPSP20. Centre for Economic Performance, London School of Economics and Political Science, London, UK.

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Abstract

In this paper we discuss some of the most important economic issues raised in European Commission vs. Microsoft (2004) concerning the market for work group servers. In our view, the most important economic issues relate to (a) foreclosure incentives and (b) innovation effects of the proposed remedy. We discuss the economic basis for the Commission’s claims that Microsoft had incentives to exclude rivals in the work group server market through degrading the interoperability of their server operating systems with Windows. We also examine the impact of compulsory disclosure of information on interoperability and argue that the effects on innovation are not unambiguously negative as Microsoft claim. We conclude with some general implications of the case for anti-trust enforcement in high innovation sectors.

Item Type: Monograph (Other)
Official URL: http://cep.lse.ac.uk
Additional Information: © 2008 the authors
Library of Congress subject classification: T Technology > T Technology (General)
H Social Sciences > HD Industries. Land use. Labor
Journal of Economic Literature Classification System: L - Industrial Organization > L4 - Antitrust Issues and Policies
O - Economic Development, Technological Change, and Growth > O3 - Technological Change; Research and Development
L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance
Sets: Collections > Economists Online
Research centres and groups > Centre for Economic Performance (CEP)
Departments > Economics
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Identification Number: CEPSP20
Date Deposited: 06 May 2008 16:20
URL: http://eprints.lse.ac.uk/4664/

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