Editing Vaporware (section)

==Antitrust allegations==
In the United States, announcing a product that does not exist to gain a competitive advantage is illegal via Section 2 of the [[Sherman Antitrust Act]] of 1890, but few hardware or software developers have been found guilty of it. The section requires proof that the announcement is both provably false, and has actual or likely market impact.<ref>[[#refBRJ|Bayus; Jain; Rao (2001)]], p. 11.</ref>
False or misleading announcements designed to influence stock prices are illegal under United States [[securities fraud]] laws.<ref name=PrenLang1994-15>[[#refPrenLang|Prentice; Langmore]] (1994) p. 15.</ref> The complex and changing nature of the computer industry, marketing techniques, and lack of precedent for applying these laws to the industry can mean developers are not aware their actions are illegal. The [[U.S. Securities and Exchange Commission]] issued a statement in 1984 with the goal of reminding companies that securities fraud also applies to "statements that can reasonably be expected to reach investors and the trading markets".<ref name=PrenLang1994-17>SEC (1994) cited in [[#refPrenLang|Prentice; Langmore]] (1994) p. 17.</ref>

Several companies have been accused in court of using knowingly false announcements to gain market advantage. In 1969, the United States Justice Department accused IBM of doing this in the case ''[[History of IBM#1960–1969: The System/360 era, Unbundling software and services|United States v. IBM]]''. After IBM's competitor, [[Control Data Corporation]] (CDC), released a computer, IBM announced the [[IBM System/360 Model 91|System/360 Model 91]]. The announcement resulted in a significant reduction in sales of CDC's product. The Justice Department accused IBM of doing this intentionally because the System/360 Model 91 was not released until two years later.<ref name=gerlach2004>[[#refGerlach|Gerlach (2004)]].</ref><ref>{{cite web|title=IBM Antitrust Suit Records |url=http://www.hagley.lib.de.us/library/collections/manuscripts/findingaids/ibmantitrustpart2.ACC1980.htm |access-date=2010-04-14 |publisher=Hagley Museum and Library |url-status=dead |archive-url=https://web.archive.org/web/20100408174629/http://www.hagley.lib.de.us/library/collections/manuscripts/findingaids/ibmantitrustpart2.ACC1980.htm |archive-date=8 April 2010 }}</ref> IBM avoided preannouncing products during the antitrust case, but after the case ended it resumed the practice. The company likely announced its [[IBM PCjr|PCjr]] in November 1983—four months before general availability in March 1984—to hurt sales of rival home computers during the [[Economics of Christmas|important Christmas sales season]].<ref name="nyt19831102">{{cite news|url=https://www.nytimes.com/1983/11/02/business/ibm-s-speedy-redirection.html |title=I.B.M.'S Speedy Redirection |access-date=2011-02-25 |date=1983-11-02 |work=The New York Times |url-status=live |archive-url=https://web.archive.org/web/20130916060236/http://www.nytimes.com/1983/11/02/business/ibm-s-speedy-redirection.html |archive-date=16 September 2013 }}</ref><ref name="freiberger19840109_16">{{cite news|url=https://books.google.com/books?id=ey4EAAAAMBAJ&pg=PA20 |title=IBM indicates March as likely PCjr delivery date |work=InfoWorld |date=9–16 January 1984 |access-date=4 February 2015 |author=Freiberger, Paul |pages=20 |url-status=live |archive-url=https://web.archive.org/web/20150516072142/https://books.google.com/books?id=ey4EAAAAMBAJ&lpg=PA14&ots=qxysACmBMb&pg=PA20 |archive-date=16 May 2015 }}</ref> In 1985 ''The New York Times'' wrote<ref name="pollack19850120">{{Cite news |url=http://www.nytimes.com/1985/01/20/business/the-daunting-power-of-ibm.html |title=The Daunting Power of I.B.M. |last=Pollack |first=Andrew |date=1985-01-20 |work=The New York Times |access-date=2017-07-03 |page=Section 3, Page 1 |language=en-US |issn=0362-4331}}</ref>

{{quote|Because of its position in the industry, an announcement of a future I.B.M. product, or even a rumor of one, is enough to slow competitors' sales. Some critics say that I.B.M. is trying to lock out competitors when it issues statements outlining the general trend of future products. I.B.M. insists the practice is necessary to help customer planning.}}

The practice was not called "vaporware" at the time, but publications have since used the word to refer specifically to it. Similar cases have been filed against [[Eastman Kodak|Kodak]], [[AT&T Inc.|AT&T]], and [[Xerox]].<ref name=stern1995/>

US District Judge [[Stanley Sporkin]] was a vocal opponent of the practice during his review of the settlement resulting from ''[[United States v. Microsoft Corp. (2001)|United States v. Microsoft Corp.]]'' in 1994. "Vaporware is a practice that is deceitful on its face and everybody in the business community knows it," said Sporkin.<ref>Yoder (1995) cited in [[#refBRJ|Bayus; Jain; Rao (2001)]], p. 5.</ref> One of the accusations made during the trial was that Microsoft has illegally used early announcements. The review began when three anonymous companies protested the settlement, claiming the government did not thoroughly investigate Microsoft's use of the practice. Specifically, they claimed [[Microsoft]] announced its Quick Basic 3 program to slow sales of its competitor [[Borland]]'s recently released Turbo Basic program.<ref name=stern1995>[[#refStern|Stern (1995)]].</ref><ref name=Flynn1995-1/> The review was dismissed for lack of explicit proof.<ref name=stern1995/>