Defending the monopolists

Guardian business editor Deborah Hargreaves has been apologising for big business a fair bit lately. On Monday she questioned the EU’s motivation in pursuing Microsoft and on Tuesday asked us to give Tesco a break.

‘It must be better to run one operating system that does everything rather than have to bolt on many extra additions from rivals,’ she says in defence of Microsoft.

It’s scary that a business editor can be so naïve. Conceding that Microsoft, ‘can be accused of stifling innovation,’ simply isn’t good enough. Microsoft hasn’t innovated in the PC market this decade. And there’s no reason why it should. Research and development is a costly business and with ninety per cent of the market in the bag, it’s hard to justify major investment. Instead, Microsoft merely fire fights with endless security patches and quick fixes. The next generation of Windows is two years late, with more delay probable, but it doesn’t really matter to shareholders as the bottom line is currently unaffected.

Tesco is a different matter; they’re not yet a monopolist. I’m lucky enough to live in suburb famed for its innovative local shops; but they’re special because they’re so unlike the corner shops we’re supposed to mourn. Operating in a highly competitive market, Tesco makes so much money because people choose them, not because they have no choice. Should they get big enough to start behaving like Microsoft, we’ll have to break them up.

But I’m with Marx on this one. The more petite bourgeois shopkeepers go to the wall the better.

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