Purchase Solution

Antitrust and Regulation

Not what you're looking for?

Ask Custom Question

In 1995, antitrust authorities claimed that the personal finance/checkbook software market was concentrated. Intuit's software, Quicken, was the top seller in the market with a market share of 69 percent. Microsoft's software, Money, was second with 22 percent of the market. Together, the Intuit and Microsoft market share was 91 percent.

In1995, Microsoft agreed to acquire all Intuit stock from Intuit's shareholders and to exchange 1.336 shares of Microsoft for each share of Intuit stock. If the sale had closed, the acquisition would have cost $2 billion.

The Justice Department sought to block the Microsoft acquisition of Intuit, arguing that it would lessen competition and innovation in the personal finance/checkbook software market. They also cited a statement by Microsoft to Intuit in which Microsoft declared it would substantially increase its competitive efforts if Intuit did not agree to be acquired. Furthermore, the Justice Department argued that if Microsoft did acquire Intuit (and Quicken), this would eliminate the chance of any new competitors in the personal finance/checkbook software market in the future. Quicken in the hands of Intuit was a strong competitor, but Quicken in the hands of powerful Microsoft would be daunting.

Attachments
Purchase this Solution

Solution Summary

Based on your understanding of the government's antitrust case against Microsoft (from the attachment), what is your opinion now of antitrust regulation?

Solution Preview

Although antitrust laws and regulations hurt the pursuit of companies looking to gain control over a particular industry segment or establish monopoly kind of situation in a particular product/service category, it is actually a good step in terms of preventing unethical practices pursued by ...

Solution provided by:
Education
  • BCom, SGTB Khalsa College, University of Delhi
  • MBA, Rochester Institute of Technology
Recent Feedback
  • "Thank you. "
  • "Thank you"
  • "Thank you. I got 20/20 last week for my discussion you help me out with."
  • "Thank you. Great Job. "
  • "Thank you. Great Job. "
Purchase this Solution


Free BrainMass Quizzes
Pricing Strategies

Discussion about various pricing techniques of profit-seeking firms.

Basics of Economics

Quiz will help you to review some basics of microeconomics and macroeconomics which are often not understood.

Economics, Basic Concepts, Demand-Supply-Equilibrium

The quiz tests the basic concepts of demand, supply, and equilibrium in a free market.

Economic Issues and Concepts

This quiz provides a review of the basic microeconomic concepts. Students can test their understanding of major economic issues.

Elementary Microeconomics

This quiz reviews the basic concept of supply and demand analysis.