Book Review: The U.S. Computer Industry: A Study of Market Power

• Author: Ronald P. Wilder
• Date: 01 September 1977
• DOI: 10.1177/0003603X7702200312
• Published date: 01 September 1977
• Subject Matter: Book Reviews

Gerald W. Brock, The U.S. Computer Industry: .A

Study

of

Market Power, Cambridge: Ballinger Publishing Co.

(1975), 250 pp., $15.00.

This industry study is one of the most recent of a long

series of such studies undertaken by students of E. S. Mason

or (as in this case) students of students of E. S. Mason.

(This book is based on Brock's Ph.D. thesis

at

Harvard,

directed by Richard Caves.) Given

its

heritage,

it

is

not

sur-

prising

that

the approach taken incorporates the structure-

conduct-performance framework, although with considerably

more emphasis on conduct

than

is usually found in studies

of this type, thanks to the accessibility into

illM's

inner coun-

cils offered by the exhibits and testimony made public

during

the

trial

of the Telex v.

IBM

ease.'

Astudy of conduct in the computer

industry

of the 1960's

and 1970's is a study of IBM's conduct and Brock's access to

the internal documents of IBM has provided fascinating in-

sight into the complexity of jrricing

and

product decisions

for

adominant firm in a high-technology industry.

The appearance of the book in 1975 was quite timely,

since

it

was a

year

in which the

Justice

Department's

major

Sherman Act case against

IB'M2

went to trial, and the lower

court decision in the Telex v.

IBM

private

action was reversed

in IBM's favor

at

the court of appeals levelS The careful

analysis contained in the study is certainly highly relevant

to the 'policy decisions

at

hand.

The study begins with an examination of

industry

struc-

ture.

In

the chapter dealing with history of the industry we

are

reminded of the speed

at

which technological develop-

ments in computation have taken place. Although Remington

Rand

took an early lead in marketing computers, having de-

livered the first Univac I to the Census

Bureau

in 1951,

IBM

had taken over market leadership by 1956, due

primarily

to

the large base of tabulating equipment upon which

it

was

able to build.

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