“Back in 1998, the federal government declared that its landmark antitrust suit against the Microsoft Corporation was not merely a matter of law enforcement, but a defense of innovation. The concern was that the company was wielding its market power and its strategy of bundling more and more features into its dominant Windows desktop operating system to thwart competition and stifle innovation.
“Eight years later, long after Microsoft lost and then settled the antitrust case, it turns out that Windows is indeed stifling innovation — at Microsoft.
“The company’s marathon effort to come up with the a new version of its desktop operating system, called Windows Vista, has repeatedly stalled. Last week, in the latest setback, Microsoft conceded that Vista would not be ready for consumers until January, missing the holiday sales season, to the chagrin of personal computer makers and electronics retailers — and those computer users eager to move up from Windows XP, a five-year-old product…
“So what’s wrong with Microsoft? There is, after all, no shortage of smart software engineers working at the corporate campus in Redmond, Wash. The problem, it seems, is largely that Microsoft’s past success and its bundling strategy have become a weakness.”