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Case Studies: Microsoft and Apple (Bill Gates and Steve Jobs)

Case Studies: Microsoft and Apple (Bill Gates and Steve Jobs). Monopolies / Trusts?. Microsoft and Bill Gates. In 1975, When Gates was 19 years old, he left Harvard University

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Case Studies: Microsoft and Apple (Bill Gates and Steve Jobs)

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  1. Case Studies: Microsoft and Apple (Bill Gates and Steve Jobs) Monopolies / Trusts?

  2. Microsoft and Bill Gates • In 1975, When Gates was 19 years old, he left Harvard University • With longtime friend Paul Allen, formed a company to produce an operating system for the first personal (small) computer- PC

  3. Microsoft and Gates • Gates and Allen named their company Microsoft • In 1980, Microsoft received the contract to develop the operating system for computer giant IBM’s new PCs.

  4. Microsoft and Gates • By 1983, 40 percent of all PCs were running on Microsoft’s operating system • Is any of this illegal? • No

  5. Microsoft and Gates • Gates and other Microsoft employees used their brainpower, became successful and benefited from America’s capitalist economic system

  6. Gates and Windows • In the late 1980s, Gates launched Windows, a new, PC-compatible operating system that used graphics and a mouse to perform computer functions

  7. Gates and Windows • Microsoft’s market share for operating systems jumped to 70 percent! • a monopoly is a market dominated by a single seller

  8. Gates and Windows • Windows allowed Gates to capture the market for software such as word processing programs (ex. Microsoft Word)

  9. Gates and Windows • Competitors’ products still depended on Microsoft’s old, less user-friendly operating systems • Competitors began to complain that Microsoft had a “monopoly”

  10. Gates and Windows: The “Monopoly” Argument • In 1997, the U.S. gov. claimed that by linking Microsoft’s Internet browser (allows people to access websites) to its operating system: • Microsoft was unfairly using Windows’ huge market share against rival browser companies

  11. Gates and Windows: The Counterargument • Microsoft argued that companies do compete with Microsoft, and people buy Microsoft software because they like it

  12. Gates: The Counterargument • Gates: “Any operating system without a browser is going to be…out of business. Shall we improve our product or go out of business?

  13. “Monopoly” in Economic Terms • There are no substitute goods available in a monopolistic economic system • Were / are there other options besides Microsoft products on PCs?

  14. The Result of the Antitrust Lawsuit • In 1999, a federal judge ruled against Microsoft • Microsoft appealed, and in 2001, the case was settled

  15. The result of antitrust lawsuit • According to the settlement, Microsoft could link its browser to its operating system but could not force computer manufacturers to provide only Microsoft software on new computers

  16. Apple and Steve Jobs: The New Microsoft? • For several decades, Apple / Macintosh was the “little guy” losing the competitive battle with Microsoft / Bill Gates

  17. Apple and Steve Jobs: The New Microsoft? • That started to change because of the creativity and genius of Steve Jobs (the co-founder with Steve Wozniak and CEO of Apple)

  18. The Difference between Gates and Jobs • Jobs was not a computer programmer and was not the “technological geek” that Gates was

  19. The Difference Between Gates and Jobs • What Jobs did extremely well was know how to cater his products to what consumers wanted; he was a marketing genius

  20. Jobs and the Rise of Apple • Jobs led the development of the iPod, iPhone, and iPad, and brilliantly marketed these products

  21. Jobs Fired by Apple • Jobswas fired by the company, returned and died in 2011 at the age of 56 after a long battle with cancer

  22. Apple and Antitrust Lawsuits • Apple has faced many legal battles, which take a long time to resolve • Many involved music streaming services that argued that Apple, with iTunes, illegally kept competitors out of the market

  23. 2016 Supreme Court Ruling: Apple and E-Book Prices • 2016 – Supreme Court = Apple must pay $450 million = illegally controlling e-book prices)

  24. The Counterargument • Jobs argued that Apple was not a monopoly / was simply trying to do what was best for its users • Also, is any publisher not happy with Apple’s terms free to reach its customers through other print and digital outlets?

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