monopoly much?

While last week’s rather toothless consent decree against Microsoft’s anticompetitive practices left many industry observers more than a bit disappointed, the furor has been compounded by a recent Microsoft SEC filing which adds real credence to charges that the company has unfairly leveraged their monopolistic dominance in one area (namely, OS software) to compete in other areas. According to the filing, Microsoft actually loses money in every single business in which they participate, except for the Windows and Office business areas, which show ridiculously high 86% and 79% profit margins respectively. In other words, allegations that Microsoft has artificially increased pricing in areas of monopoly to underwrite non-competitive entrance into other areas are apparently true. While Microsoft clearly disclosed this unusually detailed profit breakdown in an attempt to inoculate the company against Enron/WorldCom accounting practices problems, I’ll be curious to see whether their admission of this type of information will eventually prompt a reopening of the antitrust investigation.