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Maybe the fat lady hasn’t crooned the final note, but the petite lady who carries the most weight, U.S. District Judge Colleen Kollar-Kotelly, wrote the denouement to the Microsoft antitrust fiasco in 2002. Yes, Massachusetts and West Virginia — alone among nine states that contested the Justice Department settlement — have announced yet another appeal. But their crusade is as futile as a high-tech company trying to comply with the Sherman Act — aptly described by Alan Greenspan as a “jumble of economic irrationality and ignorance.” Imagine that it’s 1993, and the Federal Trade Commission has just opened its antitrust investigation of the company that dominates the market for desktop operating systems. Now fast-forward roughly 10 years. The same company still dominates the same market. But new products and new technologies, inconceivable in 1993, are attacking the desktop market in ways that government bureaucrats could never have dreamed. Palm sells nearly 80 percent of handheld computers. Sun Microsystems is a major player in server systems. America Online controls online access. RealNetworks is the leading multimedia provider. Meanwhile, poor Netscape, a four-year-old company supposedly mangled by Microsoft, was acquired for a paltry $10 billion. These companies challenged Microsoft and succeeded in carving out their market niches. But that wasn’t good enough. The challengers decided that political clout was the road easier traveled. That’s why the nonsettling states asked for relief — in Judge Kollar-Kotelly’s words — “at this late stage . . . unrelated to [Microsoft's] monopoly market.” Her explanation: “Microsoft’s competitors appear to be those who desire these provisions.” When software executives spend more time litigating and less time innovating, the tab is ultimately paid by consumers, employees, and shareholders. Remember, Microsoft’s stock plummeted $80 billion on the day that Judge Thomas Penfield Jackson issued his ill-fated conclusions of law. Contrast that single-day devastation with the lesser $60 billion in investor losses that caused national apoplexy when Enron went under. In many respects, 2002 was a dismal year for the tech sector. But at least we can thank Judge Kollar-Kotelly for writing the coda to the antitrust dud of the decade. Robert A. Levy is senior fellow in constitutional studies at the Cato Institute in Washington, D.C.

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