Trust on Trial By Richard McKenzie Perseus Books 288 pp., $26
At the start of the classic 1957 movie, "12 Angry Men," 11 jurors inside a room stand poised to post a guilty verdict in response to what seems overwhelming evidence against an accused murderer. That is until the 12th jury member, played by Henry Fonda, calmly and systematically unravels the prosecution's case by questioning the soundness of their assumptions.
In the Justice Department's antitrust suit against the Microsoft corporation, the role of the Henry Fonda skeptic is ably played by Richard McKenzie. The author, an economist from the University of California at Irvine who has no ties to Microsoft, has penned "Trust on Trial" simply because he is mortified by what he perceives to be the Justice Department's fallacious reasoning. Moreover, the author uses this case as an opportunity to reassess modern antitrust laws.
Like Henry Fonda's character, McKenzie has a lot of animosity to overcome. Journalists, cartoonists, academics, politicians, and the Justice Department have vilified the corporation, which, they contend, is a monopoly that has suppressed competition at consumers' expense.
McKenzie observes that if Bill Gates's corporation isn't a monopoly, then "Microsoft's actions can't be in violation of the antitrust law, and the government's antitrust case totally falls apart." The Justice Department antitrust suit claims that Microsoft is a de facto monopoly because there is little incentive for consumers to move to alternative products that are not as widely used, or have as many applications as Microsoft Windows. The consumers are thus, theoretically, "locked in" to Windows, making it impossible for competitors to gain entry.
Yet, in the very next breath, the prosecution claims that Microsoft used anticompetitive measures to stifle competition.