Bill Gates just accidentally proved that even "unsuccessful" antitrust enforcement works

In 1992, the Federal Trade Commission opened an antitrust investigation against Microsoft; in 2001, the company settled the claims, making a slate of pro-competitive promises that were widely derided as too little, too late.

The common account of the Microsoft antitrust inquiry is that the US government spent a decade in court and came away with nothing to show for it. This version of history is pervasive, and it's why Bill Gates, Mark Zuckerberg and even the fearless EU antitrust enforcer Margrethe Vestager have all dismissed the idea of antitrust breakups for Big Tech.

But there's another version of this story, that goes like this: being dragged through antitrust enforcement actions for a decade was deeply, profoundly traumatic for Microsoft and for Gates, personally. This trauma changed the corporate culture at Microsoft: while there had always been those who argued against monopolistic tactics, they had been dismissed as goody two-shoes who didn't understand how to maximize the company's growth. A decade of traumatic antitrust made prophets of those Chicken Littles, and whenever the monopolists in Microsoft's board rooms argued for bullying, anti-competitive actions, the anti-monopolists could say, "Are you fucking kidding me? You want them to put Bill back on the stand?!"

This version has been repeated by many (generally anonymous) ex-Microsoft employees to explain how it was that Microsoft didn't crush Google with the kinds of tactics it used against Netscape and other competitors. This story has always been debatable, because we haven't heard it on the record from anyone who was actually in the company's top management echelon. Read the rest