How Microsoft Silently Kills its Competitors: Business Strategy Case Study


The United States Department of Justice and the attorneys general of twenty different states filed a lawsuit against Microsoft on May 18th, 1998, accusing the company of operating as a monopoly and unlawfully eliminating its competitors in the computer market. And what came next was one of the most landmark court disputes in the annals of technology’s history, which dragged on for a good twenty years. And here we are, 23 years later (today), and Microsoft is still destroying its competitors right in front of our eyes, which may culminate in yet another landmark legal battle.

The following inquiries should be made:

1) What strategies did Microsoft use to eradicate its rivals?

2) What exactly was Microsoft’s approach to business that led to the company’s meteoric rise to the top of its industry?

3) From this illustrious case study, what are the most important takeaways for us to remember?

Microsoft has been accused of engaging in anti-competitive activities to maintain its monopoly on the Justice Department.

Are you of the opinion that the true definition of Internet Explorer in this article is that it is Microsoft’s web browser?

The year 1994 was a pivotal year in the history of the United States when it came to the rise of the information technology industry. At this time, global corporations had finally come to terms with the fact that the computer was a potent instrument. In addition to that, they had already begun stocking the offices with hundreds of computers, all of which were being used by the staff. The productivity of these businesses had already significantly increased as a direct result of the implementation of these computers. Therefore, it is safe to say that computers have already established themselves as an essential component of the economy of American companies.

The following is a list of the most significant occurrences that took place during the computer revolution that took place in the United States.

Microsoft’s 16-bit operating system, known as MS-DOS 1.0, was included on IBM’s first personal computer, which was released on August 12, 1981. As a result, Microsoft was able to generate a significant amount of cash through licensing.

Already in 1985, Microsoft was bringing in more than 140 million dollars in income.

On March 13, 1986, Microsoft Stock unexpectedly goes up, which results in Bill Gates becoming the youngest person ever to become a billionaire. This is a moment that will go down in history.

In August of 1989, Microsoft released the first edition of the Office suite of software, which went on to become the industry standard for companies throughout the United States of America.

Microsoft made a significant advance in the realm of the graphical user interface when it released Windows 3.0 in May of 1990.

This is what broke down the barriers that had previously prevented the average person from using computers, which at the time could only be operated through the use of code. The United States of America witnessed a meteoric rise in the number of people using computers immediately following the occurrence of this event. As a result, Microsoft became the most formidable opponent with Windows 3.0, which is currently selling at the rate of one million copies every single month. Microsoft Windows was installed on about 90 percent of all personal computers around the world. When this happened, a new facet of the computer business emerged, and its name was the internet. As a consequence of this, the market for internet browsers began to flourish in the early 1990s. A web browser known as Netscape Navigator, which first appeared on the market in 1994, was widely regarded as one of the most ground-breaking programs of its time. During that period, Netscape was equipped with capabilities that were far ahead of its rivals. For example, they had the future of document streaming, which let users view the papers even as they were being downloaded.

They offer the capability of downloading numerous files at the same time. Additionally, the JPEG image format was supported by them. They were able to acquire up to 80% of the market share for browsers even though this product had a monthly membership cost of $49 since it was so groundbreaking. The point that needs to be made here is that, just like in modern times, if you don’t have internet access, your computer is essentially useless.

People first started using computers primarily to access the internet through web browsers in the year 1995. The operating system served merely as a conduit through which users could access their web browsers of choice. Therefore, in a practical sense, browsers were growing in importance to the point that they surpassed the operating system itself. On December 5th, 1995, Netscape began trading publicly. The market capitalization of the company reached $2.2 billion in less than 24 hours. Just as they were beginning to entertain the idea of becoming another iconic internet firm, something transpired within the subsequent six years that brought the once billion-dollar corporation to the brink of extinction.

The question that needs to be asked is how it is even feasible for such a large and inventive company to fail in such a short amount of time.

The phrase “killing its rivals” is a succinct way to describe Microsoft’s business strategy, and it comes directly from the Department of Justice. This is where the solution to this question may be found. In addition to this, it instructs us to embrace, extend, and eradicate. Microsoft realised its in 1994 that they had missed the boat on the internet boom, and that browsers were rapidly becoming more important than operating systems. Therefore, when Microsoft introduced Windows 95 in August of 1995, they also included their very own web browser that they dubbed Internet Explorer, and they set it as the default browser for every single personal computer that they sold. Therefore, when you turn on your computer, Internet Explorer will automatically appear on the screen that welcomes you. On top of that, Microsoft launched something that was called ActiveX controls, which was a direct attack on the most important capabilities that Netscape had to provide. Because of this upgrade, it is now hard to download files readily from the internet, particularly anything associated with Microsoft Office. This appears to be a direct assault on some of the most important aspects of Netscape. The fact that ninety percent of the machines ran Microsoft Office made it increasingly challenging for the employees to use Netscape and other browsers. Then, Microsoft also deleted Internet Explorer from the add and remove menu. As a result, neither end users nor computer makers were able to delete Internet Explorer from their machines, and Microsoft kept it available at no cost to users.

Therefore, this was the initial way that they adopted the idea of internet browsers. Then, they improved their products by adding functions that were not supported by the products of their competitors. In the end, Microsoft exploited its dominant position on the platform to push its product at the expense of others that competed with it.