Wed, Sep 18, 2019 - Page 10 News List

Large technology firms shouldn’t be broken up: Gates


From left, then-Microsoft Corp chief executive Bill Gates, Indian Prime Minister Narendra Modi and then-French President Francois Hollande pose for a photograph at the 70th UN General Assembly in New York on Sept. 28, 2015.

Photo: AP

Bill Gates, who knows a thing or two about antitrust investigations, does not think it is a good idea to break up the biggest US technology companies as some politicians have suggested.

The Microsoft Corp cofounder and former chief executive battled the US Department of Justice for years in the late 1990s in a bruising antitrust case. At issue was the software giant’s bundling of its Internet Explorer browser to Windows as a way to maintain its dominance in PC operating systems.

Ultimately Microsoft remained intact.

Two decades later, Microsoft is one of the few big US technology companies not under regulatory scrutiny in Washington.

The US Department of Justice, the Federal Trade Commission, state attorneys general and a congressional committee are all scrutinizing so-called Big Tech — companies from Alphabet Inc‘s Google to Inc and Facebook Inc — that Washington has concluded have gotten too big and too powerful.

US Senator Elizabeth Warren, a Democratic presidential candidate, has made a forceful and detailed plan about how she would go about breaking them up.

Gates disagrees.

“You have to really think; is that the best thing?” Gates said in an interview with Bloomberg TV. “If there’s a way the company’s behaving that you want to get rid of, then you should just say: ‘OK, that’s a banned behavior,’ but splitting the company in two, and having two people doing the bad thing — that doesn’t seem like a solution.”

Microsoft narrowly avoided a breakup when a federal appeals court reversed a lower court ruling ordering the software company to be split.

The company has bounced back to top Apple Inc and Amazon as the stock market’s most valuable company, buoyed by optimism about its cloud business, and on some investors’ belief that Microsoft is a safe haven as US and European regulators sharpen their scrutiny of others in the sector.

Lawmakers, including US Representative David Cicilline, who is leading the House antitrust subcommittee’s inquiry into large Internet companies, has asked them for detailed information about acquisitions, business practices, executive communications, previous probes and lawsuits.

The panel has also asked for information from customers of those big companies, asking about mobile apps, social media, messaging, cloud computing and more.

Virtually every aspect of the companies’ business is under the microscope.

“It’s a pretty narrow set of things that I think breakup is the right answer to,” Gates said. “These companies are very big, very important companies. So the fact the governments are thinking about these things, that’s not a surprise.”

Gates said Microsoft’s own antitrust scrutiny has made the company “more thoughtful about this kind of activity.”

In his view, companies such as Google, Amazon and the rest are “behaving totally legally. They’re doing a lot of innovative things.”

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