> As Matt Stoller notes in his newsletter “BIG“, Microsoft has a track record of giving “away its new product for no or low cost to existing clients, and [bundling] it with existing product lines. In a society with functional antitrust laws, such activity would be illegal.”
That's ridiculous. According to that logic, neither Office (nor Google Workspace, formerly G Suite) should be allowed to exist -- you'd be forced to buy Word, Excel, and PowerPoint all separately.
Or by the same logic, an OS shouldn't be allowed to have any applications at all -- not even a calculator app, because that would be anticompetitive against other calculator apps.
In what universe should Microsoft not be allowed to add a chat component to their office productivity suite? When that's clearly an essential component of such suites these days? Sheesh.
Slack has had an amazing outcome. And awesome products, historically, tend to be absorbed by large corporations simply because it's more efficient and therefore profitable for everyone involved. There's nothing wrong with that.
> That's ridiculous. According to that logic, neither Office (nor Google Workspace, formerly G Suite) should be allowed to exist
It's not that they should not be allowed to exist. Rather, they should not be able to undercut competitors by using their leverage as massive tech companies to subsidize losing money on something while they starve out competitors. Stoller's article has much more nuance than you are attributing, and he outlines that in a world where these tech corporations were not allowed to get as big and powerful, you wouldn't have to be left with binary decisions like this one.
This sort of behavior is akin to Amazon selling items at a loss in order to starve out some competitor and then buying them out afterwards in order to benefit from their infrastructure and logistics.
I read his article, and unfortunately his nuance essentially comes down to:
> The loss of an independent Slack is sad, because Slack’s strategy wasn’t just a standard attempt to gain market power. As a company, Slack’s team thought carefully about product design, and that care showed.
That's not an economic argument, it's an aesthetic one.
The fact is, it's natural in many industries to coalesce around 2-3 major competitors. And as we can see, that's exactly what's happening here. Slack isn't being snuffed out. It's living on as part of one of the ~3 major players in the space, which is a natural and desirable outcome for consumers who want simple bundled all-in-one solutions.
And Microsoft hasn't been "losing money" by including chat functionality in Office -- what you're describing is predatory pricing which is simply not the case here. Office is an expensive product that companies pay tons of $$$ for.
How is it “natural” for many industries to coalesce into oligopoly? This requires a legal system with strong property rights for corporations and lax competition law enforcement. These conditions have not always existed. You can argue that the status quo is welfare-optimising, but I don’t see what’s natural about it.
Coalescing into 2-3 major competitors is natural in the sense that consumers can't, and don't want to, keep track of 10 or 20 different choices for the same thing. It's just too much. It's the paradox of choice.
There's nothing inherently wrong with "oligopolies" except when they collude together to raise prices, and competition is weak. But that's obviously not the case in office productivity software -- competition and innovation are intense, and there's zero evidence of price-gouging whatsoever.
For a small/medium sized business trying to optimize expenses, Microsoft can gain a competitive edge simply off having teams “bundled” into it’s offering, without actually being a superior product.
If your argument is that there is a tendency towards monopoly and that’s just the way of thing, even in a “free market capitalist” economy which is based largely on the idea of competition, then I don’t find it convincing.
Consumers end up with bundled solutions with 2-3 companies precisely because those companies take steps to make that the outcome (eg Apple making integration sub-par when it is not first party)
It's ridiculous that you think it's ridiculous. No, I don't think Office should exist. If Microsoft had been forced to sell Word separately from Excel, we might all still have a choice to run Lotus123, or QuattroPro. There's nothing enshrined in the Constitution that says that companies have to be allowed to bundle whatever they want into their other products. I think it's the job of our government, in fact, to prevent it this sort of thing. Microsoft bought lots of companies during the 90's (good for them!), but ran a least a dozen more -- and prominent ones, at that -- out of the market by duplicating their software, and absorbing their business. Yes! Absolutely! Microsoft can make their own disk defragmentation product. Or antivirus. Or whatever. But put a price tag on it, even if it's $0, and let it compete with everything else that's already in the market. Don't bundle it. I mean, did the browser wars teach us nothing?
Why should Word be allowed to bundle a spell-checker? Why shouldn't you have to buy that separately?
And why should the spell-checker be allowed to bundle a dictionary? Shouldn't that have to come from a separate company?
Should Photoshop be allowed to bundle a set of default filters, when there are companies that produce third-party filters? Should macOS be allowed to bundle ZIP compression, when there are companies that sell standalone compression software?
You're right we don't have Lotus 123. But we have Google Sheets, and we have Tableau, and we have Jupyter notebooks.
Literally every product is bundle of things that were combined into it, until you get either to raw physical materials or perhaps single functions in code.
I don't know how you're going to come up with a standard that allows Macs to include a menu option to compress a folder, but doesn't allow a bundle of Word, Excel and PowerPoint.
You’re operating on two fallacies (slippery slope and a strawman). I think there’s a pretty clear distinction between having a spell-checker bundled into word, and reproducing the product of a competitor after the fact and bundling it into your office suite as an accessory.
Also, that’s the whole point of the legal system (and part of what Stoller is arguing). If a spell-checker company feels the behavior was anti-competitive, they should be able to go through the legal system and fight it. I think Stoller is saying that this exact legal system is currently flawed.
First of all, it's not a straw man. Spellcheckers were standalone applications for years before word processors began integrating them. [1]
And second, it's not a slippery slope fallacy, it's an actual slippery slope, that's the whole point. There isn't a "pretty clear distinction" at all.
If I understand you correctly, you're arguing that when spellcheckers came out, the existing products should have been able to legally prevent WordPerfect (and eventually Word, and Docs, etc.) from ever building their own integrated spellcheckers. To this day, you'd need to buy Word, and then buy a separate spellchecking app or extension.
But there's no distinction between spellchecking and 100 other features that Word has that also used to be separate programs -- like mail merge, like drawing capabilities, like a citations manager, etc. etc. etc.
> I think there’s a pretty clear distinction between having a spell-checker bundled into word, and reproducing the product of a competitor after the fact and bundling it into your office suite as an accessory.
I'm not seeing a clear distinction. Imagine a scenario where Word and Excel aren't bundled. Word has always had table functionality. The Word team decides that it'd be useful if, when creating a table, end user is able to enter @cell1 + 1 to cell two to make it show the incremental value of cell one. Soon enough they'll add sort, sum, average. Then they'll create a template that creates a document with a table created by default, which looks like a spreadsheet.
Should those new functionality be allowed and who get to decide? Any attempt to regulate such product features are futile and inevitably stifle innovation.
Apple M1 is universally praised exactly because it's a SOC with integrated functions that used to require dedicated chips from multiple vendors. Imagine the inferior product if Apple is legally obliged to use Intel/AMD graphic card, in the name of maintaining the competitive landscape?
The purpose of antitrust laws is to limit how much damage powerful companies can do.
So yes, if we had functional antitrust laws in the US, Microsoft may not be allowed to do certain things. Like bundle a Slack competitor with an existing product.
The universe where this should happen is one where we recognize that a healthy capitalistic society is good, and putting constraints on concentrated power helps keep things healthy.
The real question behind all this is: are we as a society better or worse off now that Salesforce owns Slack?
That's ridiculous. According to that logic, neither Office (nor Google Workspace, formerly G Suite) should be allowed to exist -- you'd be forced to buy Word, Excel, and PowerPoint all separately.
Or by the same logic, an OS shouldn't be allowed to have any applications at all -- not even a calculator app, because that would be anticompetitive against other calculator apps.
In what universe should Microsoft not be allowed to add a chat component to their office productivity suite? When that's clearly an essential component of such suites these days? Sheesh.
Slack has had an amazing outcome. And awesome products, historically, tend to be absorbed by large corporations simply because it's more efficient and therefore profitable for everyone involved. There's nothing wrong with that.