“A Challenge to Oracle”: The Wall Street Journal Letters to the Editor

Dear Editor:

Your recent articles by Glenn Simpson and Ted Bridis have finally begun uncovering the clandestine campaign by Investigative Group International (IGI) at the behest of Oracle Corp. and possible others against those economists and other scholars who have been honestly critical of the antitrust prosecution of Microsoft, Intel and other high-tech firms. Instead of being willing to address the issues openly and honestly, IGI’s client, Oracle Corp., has apparently felt the need to use back-alley tactics, subterfuge and disinformation in order to achieve its aims. For an organization that uses IGI, “Upstream Technologies,” and others to front its operations, I fail to see how Oracle has a leg to stand on. And, since Oracle grew out of a contract with the CIA and is proudly named after that CIA project, what does this say about the corporate culture at Oracle?

In a Wall Street Journal article today, Oracle is quoted as stating: “. . . Oracle discovered that both the Independent Institute and the National Taxpayers Union were misrepresenting themselves as independent advocacy groups, when in fact their work was funded by Microsoft for the express purpose of influencing public opinion in favor of Microsoft during its antitrust trial.”

But the truth of the matter is, our research and work in this area predates the Microsoft case, the “browser wars,” and even the Internet industry itself. In addition to many other areas, our book, Winners, Losers & Microsoft, by our research fellows Stan Liebowitz and Stephen Margolis, draws upon the authors’ systematic research of independent software reviews from computer magazines over the past 15 years. The Open Letter was organized to promote the Institute’s long-running work in this field.

As we have done with the other open letters we have sponsored in the past, our Open Letter on Antitrust Protectionism was organized, written and promoted entirely on our initiative. Two hundred and forty of our nation’s leading economists and other scholars signed the Open Letter, none of whom was paid for his or her involvement. The Institute used its general funds to publish the Open Letter in two national newspapers.

The fact that Microsoft has been a member of The Independent Institute for the past two years has not altered any aspect of the substance or conclusions of our consistent and indeed independent work, stretching back over the previous 10 years. Microsoft’s support constitutes a gift, which any first-year law student can tell you is insufficient to support a legally enforceable contract. The Independent Institute has never performed contract research and never will.

All of our work is strictly based on the excellent, scholarly standards of peer-reviewed science, for which we will not accept contract funding, and there is no aspect of government policy nor social or economic issue that we might not address. Here we have a federal court case that will affect the future of global markets in a field that is producing the single greatest economic revolution since the dawn of the industrial age. Pursued at the behest of a group of multi-billionaire business leaders, this case is based on a fundamentally flawed economic theory (“path dependence”) that has no empirical evidence to support it and no evidence of consumer harm. Meanwhile, opinion polls show that the general public is overwhelmingly opposed to the case and ranks Microsoft at the highest order. We shouldn’t let the continuing sideshow of public relations campaigns and corporate espionage mask the real story in this case—the pervasive existence of corporate welfare and corporate statism in the U.S., of which antitrust protectionism is one major aspect.

Since its publication,Winners, Losers & Microsoft has received glowing reviews from top economists and other scholars in the field. It would appear that perhaps the inconvenient, timely and well-received findings of our work might not have exactly set too well with Oracle and others who have a sizable special-interest stake in the outcome of the Microsoft case. We challenge Oracle’s executives—and renew our invitation to Assistant Attorney General Joel Klein—to publicly debate the central economic, legal, and social issues of antitrust, competition, and high technology.

David J. Theroux
Founder and President
The Independent Institute