Mr. Gates is no doubt smart, but I know George Priest. His advantage in these matters is not just comparative - it is also absolute. Yet after reading his essay, I am less clear about what Microsoft et al. believe this case is really about.

My letter asked a number of questions. These questions, Priest replies, simply "reveal how little" I understand "about the economics of software." The economics of software, Priest believes, is "different." It calls for something other than a "business-as-usual approach." Unlike "old-economy" products, "the value of [software] increases as the network expands." It makes sense, then, for Microsoft to "integrate" its browser into its operating system. Interfering with that "right," Priest says, will only "put ... consumers at considerable risk."

Priest is by far the better economist, though we should not forget that many economists - some as good as Priest - believe that the network effects he describes give policy makers more reason, not less, to be concerned about monopoly behavior. But the basic point that he makes is clearly correct: The economics here are different. I would add that we don't really know much about how the economics in an industry like this functions. In my brief (and pleasant) tenure as special master in the earlier Microsoft case, I pointed Microsoft to economic research that explains and may excuse the growth it has experienced. This work, by Erik Brynjolfsson and Yannis Bakos, suggests that there may be something new in software economics that antitrust regulators may need to take into account.

But Microsoft did not raise a "new economics" defense, and nothing in my letter to Mr. Gates hung upon "business-as-usual" economics. Indeed (to reverse the poke of an old friend), to believe that it did is to "reveal how little [Priest] understand[s] about ... software" - for the government has not attacked "integration" per se. The government has attacked integration of a particular kind - namely, using software to bind together two products in a way that hinders competitors. As the government argued, and as U.S. District Court Judge Thomas Penfield Jackson found, many operating system providers "integrate" a browser into their operating system. Only Microsoft does so in a way that hinders competing browsers.

Does Mr. Gates believe this is Microsoft's right? That was my essential question. When there are two ways to "integrate" a product into the operating system - one that hinders competitors and one that does not - does Mr. Gates believe he should have the right to use his power over the platform to trip the competition?

It would not be absurd to answer yes this question. One could well argue that a firm - even a dominant one - should be free to use whatever means are at hand to disable the competition. After all, that's what competition is about. And if you can bias the operating system to prefer its own against competitors, that is just competition by other means.

Alternatively, one might argue that Gates should have this right because it is too hard for courts to distinguish between benign and malign integration. Software, one could argue, is just too complex. And in this way, I agree again, software is different: In my brief to the court, I affirmatively argued that the court should sketch a different standard for software bundling that reflects how different software is.

But Priest has not embraced either answer to my question. Indeed, he offers no answer at all. Instead - shifting to "old-economy economics" - he asks why one would "assume" that if a firm integrates, it then "aims to become a monopolist." Why not simply "assume the opposite"?

Now I know that economists love to assume, and indeed, in my brief, I said that we should assume the best when a firm integrates two software products - unless there is good reason to be skeptical. But this case was not litigated on assumptions; the government did not prevail by telling Judge Jackson that he should assume Microsoft "aims to become a monopolist." The government set out to prove what Microsoft "aims to become," and Jackson found that the government succeeded in its proof. Microsoft aimed, Judge Jackson concluded, to use its power over its operating system to protect itself from competitors whose products might well undermine its monopoly.