August 02, 2004
Free Market Miracle #0003
Microsoft said on Thursday that it planned to increase its storehouse of intellectual property by filing 50 percent more patent applications over the next year than in the previous 12 months.
Microsoft, the world's largest software company, increasingly regards the legal protection of its programming ideas as essential to safeguarding its growth opportunities.
May be. But it's also a grade-A market distortion. Indeed, one could argue that there is no greater interference in the operation of Free Markets than the holding of "Intellectual Property". Remember, the "invisible hand" doesn't want to know how a commodity gets to market, it wants to know how inexpensively. If Joe Blow can produce, package, and bring to market Microsoft Office's code more efficiently than can Microsoft itself, then, clearly, the buyer will gravitate to Joe's product.
So then how is Microsoft supposed to safeguard its growth opportunities? In a true market-based economy, that's beside the point! The Market isn't supposed to guarantee Microsoft's profitability any more than it's supposed to guarantee a subsistence wage. Market enthusiasts argue that both will magically result. But nobody's bothered to try it out to see if they're right.
Anyway, given that it attained its position by stealing others' ideas and squashing competitors like bugs, Chairman Bill has some nerve in terming "patents a 'very important part' of what he termed the 'cycle of innovation' that has been responsible for Microsoft's past prosperity and continued corporate health."
The question we should now be asking ourselves is why anybody would pay several hundreds of dollars for Microsoft Office, when a superior office suite is available for free?
Posted by Eddie Tews at August 2, 2004 07:52 PM
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