Re: Bundling and operating systems

["Lewis A. Mettler" <lmettler@lamlaw.com>]

Eric,

Microsoft bundled IE because they saw that 80% of the consumers
preferred Navigator.

You must work for Microsoft.

Only Microsoft would be so stupid to suggest that IE is bundled with the
OS because everyone wanted it.

Eric Lee Green wrote:
> 
> On Sat, 18 Dec 1999, you wrote:
> > > The price of a specific instance of the product is increased to cover the cost.
> > > But the price, ON AVERAGE, of the solution that consumers buy may actually
> > > decrease, due to the decrease in packaging, manufacturing, marketing, and
> > > distribution costs.  It depends upon how many consumers want the functionality
> > > that is proposed to be bundled.
> >
> > Sorry.  Harm is measured by the individual consumer not averaged.
> 
> I think this is the essential difference between law and economics. Economics
> is concerned with the overall impact of actions. Law is concerned with the
> effects of actions upon one specific person.
> 
> For example, VW USA has made the decision that all VW New Beetles sold here in
> the United States shall be sold with air conditioning. Now, folks in Wisconsin
> do not need air conditioning,.But the fact remains that the majority of
> consumers want air conditioning in their car, and it was not economical for VW
> USA to produce cars without air conditioning just for the Wisconsonites out
> there.
> 
> Should Wisconsinites be able to sue VW USA for this bundling? After all, they
> are clearly getting harmed... they could buy the car for $300 less if not for
> the air conditioning!
> 
> But from an economic point of view, it is more cost-effective, because the
> average consumer gets his air conditioning for less, because it costs less to
> put the air conditioning on at the factory than it would take for dealers to
> install it separately (due to the fact that they have to remove the radiator
> etc. to install air conditioning on un-air-conditioned cars).  The average
> consumer saves approximately $200 due to this bundling.
> 
> What I see you saying, Lewis, is that  if there are 9,999,999,999 people who
> benefit from bundling, and 1 person who is harmed by bundling, this is an
> actionable item even if the "harm" is just $10. I'm sorry, Lewis, but that's
> the sort of reasoning that gives lawyers a bad name.

Microsoft bundled IE because they saw that 80% of the consumers
preferred Navigator.

-- 
Lewis A. Mettler, Esq.(Attorney and Software Developer)
lmettler@LAMLaw.com
http://www.lamlaw.com/ (detailed review of the Microsoft antitrust
trial)