Economist Robert Reich, former U.S. Labor Secretary under President Clinton, is calling for the elimination of the health insurance industry's exemption from federal anti-trust laws, and his argument is compelling.

The anti-trust exemption dates back to when the health insurance sector was dominated by hospital non-profits, during which collaboration was constructive: it reduced costs per policy holder by spreading out the costs of expensive equipment over more policy holders. Today, under the mostly for-profit, private sector system of providers, it's just encouraged 'territoriality' -- i.e. the unwillingness of insurers to compete seriously in another insurer's region -- resulting in little competition, sole provider-dominated markets, and of course, massively higher premiums.

With last week's BusinessWeek article expecting a verdict on the proposed merger between Sirius Satellite (NASDAQ: SIRI) and XM Satellite (NASDAQ: XMSR) soon, I feel that it's imperative that the regulators let the deal happen. Without a deal, both companies will continue to incur heavy losses, and the future of satellite radio will be in jeopardy. It's ironic that the antitrust lot are worried about a monopoly, but without a merger, the entire industry could be finished.

With plenty of competition coming from traditional radio, internet radio, and Apple (NASDAQ: AAPL)'s iPods, the government's worry over lack of competition is unfounded. Rather, the money saved by the merger in new customer acquisition will help keep the companies solvent. Doug McIntyre had a nice analysis of the deal a few weeks back, and he feels that with both stocks' recent rise, Wall Street is telling us that 1) they think the merger is going to go through, and 2) it would be mutually beneficial if it does.

If we can get a quick resolution to this, after months and months of foot-dragging by regulators, and the resolution is in favor of the merger, then this will be a defining movement for the satellite radio industry as it moves ahead and becomes a true media force to be reckoned with.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. Disclosure: Writer has no position in any stock mentioned as of 12/03/07.

Google (NASDAQ: GOOG) is trying to convince [subscription required] the Justice Department that it should seek to extend its anti-trust oversight of Microsoft (NASDAQ: MSFT). A U.S. District Court agreed in 2002 to keep track of Microsoft's anti-competitive behavior.

Of course that was back in the day when Microsoft was using its Windows operating system to crush companies with competing browsers, like Netscape, and competing media platforms, like RealNetworks (NASDAQ: RNWK).

Google claims that because Microsoft's Vista OS has been found to make it difficult for PCs to run the Google desktop search function, that the government should continue to keep an eye on Redmond. The government's current watchdog role ends in November.

Google is telling the government that it cannot take care of itself. If Microsoft is the originator of future bad behavior, it cannot come back to the courts with a new case. Microsoft is too big and too bad to be controlled.

It is an argument that is too clever by half. Google is not Netscape and it is not RealNetworks. It competes with Microsoft on an even footing. It does not need the help of the federal government to make sure that Vista does it no harm. If its problems persist beyond November, it can always come back with a new complaint. But Microsoft probably gets the message.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Microsoft Corp. (NASDAQ:MSFT) has not paid out this kind of money unless the company was settling a patent claim or antitrust judgment. The company is investing $400 million in its partnership with Novell [subscription required]. The partnership, announced last week, aims to get the Windows and Linux operating systems working nicely together on PCs.

MSFT will be paying for coupons so that corporate customers can get annual licenses to the Suse Linux operating system. It is, in essence, paying for the distribution of the open source software it has feared would take market share from Windows.

With Microsoft's new operating system, Vista, about to launch, supporting rival Linux would seem a queer thing to do.

Not necessarily. If Microsoft becomes the de facto largest reseller of Linux, it will have some measure of control over how fast the open source initiative can grow. Novell, Inc.'s (NASDAQ:NOVL) annual sales are under $1.2 billion, and its rival in the Linux market, RedHat, Inc. (NASDAQ:RHAT) has sales of well under $300 million.

Microsoft also got a promise from Novell that it would not sue Microsoft over Windows, presumably over any patent issues or monopoly practices.

And that, by itself, could be worth $400 million.

Douglas McIntyre is a partner at 24/7 Wall St.

Microsoft Corporation (NASDAQ:MSFT) is now a bloated company. Naturally, not all of it is bad. But, at the company's current scale, there are issues to contend with that might be more easily resolved in leaner and meaner pieces. This is the first in a two-part story.

We all would love to be bloated by Microsoft's cash hoard, patents, growth history, depth of management, research & development strength, and certainly the company's potential to bring product to market.

Nevertheless it is time to consider Micro'soft' vs Micro'hard'. The development of the XBox, and now the Zune -- and with the possibility of Microsoft stores in the air -- make this a timely consideration. I am not promoting breaking up the company without very deep and measured analysis of the merits (Peter Cohan had some analysis of this very topic, in June), but given Microsoft's size and slower growth prospects it is worth considering.

The break-up of many of our largest corporations has been a topic of discussion as investors seek to maximize company potential.

Microsoft struck out in court again.  A third federal judge denied it access to documents related to its case pending before the European Commission.  U.S District Court Judge Colleen McMahon refused to grant Microsoft access to IBM documents.  She said that Microsoft's subpoena was an attempt to undermine European law enforcement.  If Microsoft had been successful, she said it would harm other companies.

This is now strike three for Microsoft and it's out of options.  Federal judges in California and Boston also refused Microsoft access to documents from Novell, Sun Microsystems and Oracle previously. 

Microsoft now must focus its efforts on its appeal of the European Commission's 2004 anti-trust ruling.  If it loses its appeal before EU's second highest court next week, it may face fines of $2.4 million per day.