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M.RAHIM EJAZ

Question No. 1: Is Microsoft guilty of being a monopoly? Explain.

Answer: No, Microsoft is not guilty of being a monopoly. The reason is


that Microsoft is enjoying the monopoly in the market. Although the DOJ
and judge Jackson has declared that that Microsoft has exerted monopoly
power in the market. Now the market share of Microsoft is 95%. Microsoft
has effectively argued that they are just been successful and competitive.

Question No. 2: What are the major issues in this case? How have
these issues evolved?

Answer: The major issues are as fallows.

1. Monopoly

2. High barriers to entry

3. Lack of alternatives

4. Threat to partners

5. Monopoly through pricing

6. Monopoly through technology

1. Monopoly

Microsoft has dominancy in the market and DOJ has also declared
that Microsoft has monopoly.

2. High barriers to entry

Microsoft has over 70000 software applications. So it is difficult for


another company to enter in the market.

3. Lack of alternatives

Software developers produce software that is compatible only in


windows and windows has largest market share.

4. Threat to partners

Several companies transacted business with Microsoft and Microsoft


practices intimidated and threaten because companies claim that

BUSINESS ETHICS |
MICROSOFT
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M.RAHIM EJAZ

Microsoft force them to close their software development that are


competing Microsoft applications.

5. Monopoly through pricing

Microsoft has set prices that are very low in the market. This is also
a reason of monopoly.

6. Monopoly through technology

By using the latest technology and software, Microsoft also exerts


monopoly in this way.

Question No. 3: Identify the stakeholders and their stakes in this


case?

Answer: Media, PC users, Customers, Partners and the Competitors are


the stakeholders in this case. Media consists of newspapers, magazines,
television, radio and internet. Media has provided full coverage of this
case. PC users and customers are the most important stakeholders. They
are satisfied with the Microsoft applications. Partners and the competitors
would be affected by the outcome of the case.

Question No. 4: Do you agree or disagree with the legal and court
decisions made to date in this case? Explain.

Answer: yes, we agreed with the court decisions that are made in this
case. We believe that Microsoft has exerted monopoly and this act is
unethical. Every company should be given equal rights to enter in the
market. DOJ has also declared that Microsoft has monopoly in the market.
BUSINESS ETHICS |
MICROSOFT
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M.RAHIM EJAZ

Question No. 5: How have the environment changed in this case?


Explain.

Answer: From the beginning Microsoft has violated the court orders by
giving IE built in Windows and due to this act Microsoft, DOJ fined $1
million to Microsoft. Now, as the case goes on in the court, the
environment of the case changes time by time. At last DOJ asked to
federal judge to break the Microsoft into two companies but the circuit
court reverses the breakup orders. DOJ declare that Microsoft has illegally
defended the Windows. In the end, a settlement is reached that freedom is
given to PC makers to install non-Microsoft software and to remove
Microsoft applications.

Question No. 6: How has Microsoft’s competition changed since


this case?

Answer: After the settlement of the case, the high barriers to entry are
broken and now companies are free to move in the market. Now they can
launch their software in the competition with Microsoft.

Question No. 7: Suggest a settlement to this case. Should


Microsoft be punished? How?

Answer: Freedom should be given to all the companies in the PC market.


Every company can easily launch its software in the market. There should
be the environment of competition. Yes, Microsoft must be punished for its
unethical activities by imposing heavy fine.

Question No. 8: What are the lessons from this case and since this
case?

Answer: Companies should not perform illegal activities in the business.


Companies must fallow the laws and rules in the course of business. Do
not create monopoly illegally. Do not break the court orders. Business
must be performed in an ethical and legal way.

BUSINESS ETHICS |
MICROSOFT