Paul Spirito wrote:
Declan,
All of your examples are of antitrust actions *stopped* by political pressure. Of course, monopolies tend to have lots of cash, & that buys influence -- but this is just one more reason to bust them: the disproportion in economic power within the industry corrupts the political system.
I have worked on several antitrust issues over the past several years. My first serious attempt to stop a a merger involved tbe Thomson purchase of West Publishing, for $3.4 billion. This involved 2 of the three large legal publishers (West was number 1). West publishing was a privately owned firm. The largest shareholders were the Opperman family. The Opperman family gave Clinton and other democratic party funds more than $300k during the merger review, directly, and raised more from third parties. Vance Opperman had coffee with Clinton and dinner with Gore during the review. Earlier Vance had approached Clinton at a fundraiser to intervene in a Reno antitrust investigation of West (which was dropped). The merger was approved, after a compulsory license and some modest divestitures (we were quite unhappy with the result). We opposed the Bell Atlantic/Nynex merger (we didn't do as much as we should). Bell Atlantic has so much capitol hill juice they were able to hold up Klein's nomination, basically until the merger was approved. We opposed the Staples/Office Depot merger, and were quite active. This was before the FTC. Staples launched a very large PR campaign, with some hill lobbying, but the FTC held its ground, and the merger was stopped. We opposed the Boeing/McDonnell Douglas merger. Not only did the FTC permit the merger without any strings (Numbers 1 and 3 in a 3 firm market with huge entry barriers), but Bill Clinton personally lobbied the EC to approve the merger, and sent a delegation to Brussels, which included Joel Klein, the DOJ antitrust head, to argue against divestiture of the McDonnell Douglas civilian airline business. I've worked on other mergers, including mergers in the railroad industry, the hospital industry, and the pharmaceutical industry, and I have been involved in other antitrust issues, such as in attempts to get the FCC to make cable systems unbundle set top boxes, and create cross ownership rules between cellular and PCS, and cable and DBS. In virtually every case politics played a role. Typically, the incumbent firms, or the one that want to merger, have the most influence, politically. Thus, I was surprised to hear Declan say that we thought politics didn't play a role in antitrust actions against Microsoft. There are many areas where politics come into play. Gore sent his daughter to work for Microsoft during the DOJ investigation. Microsoft has rallied its troops, starting with the Washington state delegation, they have also picked up players like Vin Weber to talk with Ginrich, and they are involved in countless other attempts to influence the Congress and the executive branch. Microsoft's competitors have been active too. Senator Hatch is obviously concerned about what MS had done to Novell and Wordperfect. The stakes are high, and there is a lot going on. That doesn't mean politics is the whole ball game. Public opinion is a big factor, as is the opinion of experts or reasonably informed persons. It is generally difficult to get DOJ or the FTC to bring an antiturst action against anyone. The Microsoft case is very high profile, for many reasons. Now that DOJ is engaged, I would expect them to make every effort to prevail on the narrow issue before the court. Who knows if DOJ will be interested in pursuing the broader issues about MS's use of the OS to gain leverage in applicaitons markets. There is a lot still up in the air. Jamie -- James Love Consumer Project on Technology P.O. Box 19367, Washington, DC 20036 voice 202.387.8030; fax 202.234.5176 http://www.cptech.org | love@cptech.org