MICROSOFT ACQUIRES LINUX

Introduction
The Microsoft Corporation is the largest diversified computer software company in the world. Linux is simply a computer operating system. The stable and flexible nature of Linux has attracted people to use it at home and work computers. Linux has many advantages like they are more stable, secure as well as robust. It is considered to be perfect storage of huge information database.
As a competitive strategy, a marketer of a successful product may bundle a newer or less successful product with its stronger product as a means of edging its way into a new market. Perhaps the most famous example of this is Microsoft Corporation's bundling of various software applications. The comparative advantage of innovation and new technologies in the business activities made Microsoft become monopoly. If Microsoft acquires Linux, Microsoft will become still powerful. It would usually cause market failure. Moreover, considering the problem of market failure, Government intervention is inevitable in the case of Microsoft. Government filed a case as Microsoft acted as monopoly.

Monopoly
If a firm only one which can produces a certain goods, it has monopoly in that market for that good. There are so many buyers in the market and there is a restriction to new firm enters into the market. The monopoly firm produces and sells their output where MR=MC and get abnormal profits before the government regulate to them.

The U.S vs. Microsoft case of 1998 may be considered as a best example in showcasing the effects of antitrust laws against monopoly power. Microsoft manufactures the Windows family of OS (operating systems) for personal computers and servers. The Court claimed that the Microsoft acquired the monopoly power in the Intel – Compatible PC operating systems by charging a higher price above the competitive market. The market share