Re: More details on the NT Workstation TCP limit

Rohit Khare (khare@w3.org)
Wed, 7 Aug 1996 14:11:13 -0400 (EDT)

Well, the line from this behavior to "monopolistic" is indeed a little
blurred. The main benefit of a monopoly is segmentation. Rather than
producing a single product at a single price at the intersection of
suppl and demand, they can force each customer to pay the full marginal
price by getting the entire area under the demand curve rather than the box
to a point. It's why airlines can capture 10x more revenue from one passenger
than the next. Now, segmentation does not *imply* monopoly, but it does
imply fear and loathing.

Another classic example is one of the old IBM line printers that had a field
installable 2x speed upgrade. The technician would come in, order everyone out
of the (leased) computer complex, then remove the speed-reducing gear :-)

So it's Microsoft's perogative to sell two versions of a product for two
different prices. The claim of monopoly discrimination (increasing returns to
concentration) would be borne out if IIS (MS's web server) ran on Workstation
*without* the same limit applied to WebSite. If the price of (Server - WS) is
greater than (any competing web server as a standalone business), that would
equally suck.

But still, network effects are contentious in anti-trust theory. MS doesn't
have a monopoly in OSes OR in Web Servers individually, but here we are
attacking the combination.

Rohit