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Computer industry

Texas Holds Fire on Microsoft Antitrust Suit

Strategic Insights

— 1 min read

Texas Attorney General Dan Morales has decided not to sue Microsoft Corp. on antitrust grounds, instead seeking a negotiated settlement. This move is likely to please major PC makers Compaq and Dell, which have expressed concerns about disrupting the PC market, a key driver of growth in Texas. Morales' decision reflects the state's focus on protecting Texas consumers, companies, and jobs, rather than challenging Microsoft's dominant market share. The company's PCs have seen steady growth throughout the 1990s, with Compaq and Dell accounting for 18% of the market in 1997, shipping 14.8 million computers.

Key Takeaways:

  • Texas Attorney General Dan Morales has decided not to sue Microsoft Corp. on antitrust grounds.
  • The decision is likely to please Compaq and Dell, major PC makers in Texas, which have expressed concerns about disrupting the PC market.
  • Morales' focus is on protecting Texas consumers, companies, and jobs, rather than challenging Microsoft's market dominance.
  • Compaq and Dell account for 18% of the PC market, shipping 14.8 million computers in 1997.
  • Dell is committed to building products in line with broad standards, which means using Intel chips and Microsoft software.
  • Dell's philosophy is to be a "preferred customer" to suppliers, with a strong relationship with Intel and Microsoft.
  • The government's case against Microsoft is based on actions concerning Netscape Communications, including pre-installing Internet Explorer software.
  • Dell charges an extra $15 for Netscape's browser software, with the cost dependent on the customer's volume.

Statistics:

  • Compaq shipped 14.8 million computers in 1997, accounting for 18% of the market.
  • Compaq reported sales of $24.5 billion in 1997.
  • Dell's sales were $12.3 billion in its 1998 fiscal year, which ended in January.
  • Dell expected to report record earnings in 1998.
  • Microsoft's market share in the PC software market is approximately 87%.
  • The PC software market is dominated by Microsoft, with a global market share of 87%.
  • Compaq is the second-largest PC maker in the world, with sales of $24.5 billion in 1997.

Sources:

  • "Texas not to sue Microsoft, for now" by wireds on HighBeam Research, 30 MAY 1998
  • "Dell Gets Record Earnings Guidance" by Joe Wilcox on Computerworld, 08 APR 1998
  • "Compaq Fiscal First Quarter 1998 Highlights" by Compaq on CompUSA.com, 1998
  • "PC Software Market Share" by Dataquest on Dataquest.com, 1996
  • "Microsoft Corp." by Dataquest on Dataquest.com, 1996

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