Should We Welcome Microsoft's 'Predatory' Pricing?
from the monopoly-time dept
For some time there's been concern about how Microsoft's push into security software might square with its reputation (and conviction) as a monopolist. Depending on your point of view, the company could be seen as trying to profit from its own software vulnerabilities by selling security or abusing its monopoly by bundling anti-virus software along with its products. This dilemma appears to be coming to a head with the release of its OneCare security suite, which is priced significantly below that of equivalent competitor packages. On the blog of one security company, the case is made that the company is guilty of predatory pricing, in a deliberate attempt to damage the competition. There's no doubt that Microsoft does want to take shots at its competitors -- that's what all businesses do. What's funny though is that the argument boils down to the fact that OneCare is too good of a deal, that its licensing terms are too flexible, and that a software package of its caliber just shouldn't be so affordable. All this sounds pretty good for consumers, whom the law should ultimately be designed to protect. If security software is such a commodity that price is the only concern for customers, then the price should be dropping. In addition to the direct concerns about pricing, the company argues that Microsoft will establish a monopoly in the space, and that investment in new research and startups will dry up. One reason this isn't likely is that security software doesn't lend itself to a natural monopoly the way an OS does (not to mention the fact that the vaunted Windows monopoly itself is seen as weakening). On the issue of future investment in the area, this too seems like a red herring. Microsoft's monopoly hasn't killed innovation; in fact it prompted entrepreneurs and investors to pursue a radical new envisioning of how software could be developed and distributed using the web. Getting the government to preserve the status quo in the security space would be the last way to ensure a dynamic, innovative market.