In all the conservative caterwauling over the threat of breaking up Microsoft into separate companies, there is remarkably little comment about the conservatives apparent fear of the market. Apparently, separate companies would not be able to negotiate satisfactory contracts in the marketplace to assure the same "synergy" that an integrated company achieves.
Now, sophisticated law and econ types can distinguish such "synergy" from monopolistic abuses, but it is remarkable that few in the business press are even asking Microsoft and its defenders to try to explain why separate MS companies could not accomplish as much in the marketplace as they do under Bill Gates central planning.
Now, I am not a big fan of breaking up M$ since I don't buy the purity of market relations either. Structural regulation would go a lot farther, from publishing the source code and a host of other transperancy requirements by MS.
But it is remarkable that so many market proponents suddenly see disaster if the separate MS divisions might be reduced to depending on ** shudder ** contracts in the marketplace. Obviously, according to them, the collapse of central planning under Bill Gates promises disaster not only for the company but for the computing industry as a whole.
All odd in the looking glass world of law and economics defense of non-market relationships superiority to the market.
-- Nathan Newman