Can Antitrust Keep Up?: Competition policy in high-tech markets

Not since the 1911 breakup of the Standard Oil trust has a government antitrust case attracted as much public attention as the Justice Department’s thus-far successful suit against high-tech giant Microsoft.Although its ultimate outcome may not be known for several years, the Microsoft case has generated an intense nationwide debate among antitrust practitioners and business leaders about the relevance of antitrust to high technology. The critics’ central claim is that the pace of change in high tech is so rapid that antitrust, and the legal machinery within which it must operate, is too slow and potentially counterproductive. Those who defend the applicability of antitrust to high-tech firms and industries, including the federal enforcement agencies, instead see a realistic potential for promoting innovation and consumer welfare through competition policy.Antitrust’s contemporary engagement with high-tech markets, most visibly in the Microsoft case, is based on an emerging intellectual consensus about the way competition works in those markets. That consensus has been shaped importantly by two documents issued during the Clinton administration’s first term-government antitrust guidelines on intellectual property licensing and a Federal Trade Commission staff report on competition policy in the high-tech global marketplace. The contemporary perspective on competition in high-tech markets is based on five core principles likely to withstand shifting political winds