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An interesting example of strategic behavior comes from a 1997 article about Microsofts investment in Apple (New Straits Times, 1997). The article is included in the Required Readings list. Facing tough anti-trust scrutiny from government agencies, Microsoft provided financial support to Apple in order to ensure Apples survival and, therefore, to ensure that competitiveness in the industry remains. Moreover, the partnership with Apple provided an additional market for Microsofts products “ the MS Office and the IE products were to be bundled with the MAC OS as one of the conditions for this financing. Discuss this case in the context of market structure and strategic behavior. What market structure do these firms operate in? Why did Microsoft need to preserve competitiveness in the industry? What was Microsoft afraid of in the event that Apple did not survive?
From a global point of view, Apple and Microsoft operate in a totally different market structure. Microsoft is well known in its monopoly market structure which is defined as a market in which there is only one seller of the product or service that has no direct substitutes. Microsoft is one leader in the technology industry that controls the windows operating system core. Microsoft is the undisputed leader in the market right now for all windows, Microsoft has used its power as the leader in the market with operating systems to grow into the market-leading industry. A combination of good business tactics, regretful business choices by competitors, and finally Microsoft using its new market power has made Microsoft untouchable by competitors (Gleick, 1995).
As for Apple Inc, they are in some ways in the monopolist competition market. Apple has a lot of competitors in the laptops and computer industry such as Dell, HP, and Samsung that are doing very good as well. Apple main focus is their digital music industry where they are leading right now and have complete control with almost no competition (oligopoly). Apple uses iTunes to make much of their profits. The company gets 30 plus percent of every transaction on iTunes. With that, the selling of iPods helps Apple become a monopoly. With Apple having control of the digital music industry, and unlike Microsoft, they have to keep the competition going to be able to last long in the market. They will need competition to be able to keep improving their products and services; otherwise, it may affect them in the long run.
Since Microsoft and Apple have partnership and the reasons why Microsoft funded Apple to keep them in competition, is for Apple being on competition will be not only for their own good and also with on the profit for Microsoft to keep their power in the monopoly market going, preventing any entry for other companies (Spout, 2006).
Monopoly has the tendency to stiffen innovation, and since Apple’s goal is to continue to innovate rigorously, and for them to be able to be on that track, they have to keep driving for perfection and not dominating the market as Microsoft did with their unlawful tactics.
References
1).  Douglas, E. (2012). Managerial Economics (1st ed.) [Electronic version]. Retrieved from https://content.ashford.edu/ (Links to an external site.)
2. Gleick, J. (2013) Making Microsoft Safe for Capitalism.” The New York Times. Ed (6)
3. Stoup, J.R. (2006). Has Apple Finally Become a Monopoly Like Microsoft? Retrieved October/09/2014 from http://www.applematters.com (Links to an external site.)
4. New Straits Times. (1997). Microsoft-Apple partnership stuns computing industry (Links to an external site.).  Retrieved from http://news.google.com/newspapers?id=rZxOAAAAIBAJ&sjid=HBUEAAAAIBAJ&pg=6732,188074&dq=apple+partnership+with+microsoft&hl=en

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Steve Jobs and Bill Gates are two iconic names in the computer world. The market structure that these two companies live in is very complicated. We need to separate Microsoft and Apple from their operating system. Apple has more competition than Microsoft due to their line of products; tablets, cell phones, computers. Apple resides in a very strong oligopoly market. If we view just the operating systems, you may say that they are both an oligopoly due to the fact that they are both operating systems. They can collaborate with or compete against each other to use their collective market power to drive up prices and earn more profit.
If we just focus on Microsoft and the Office products, you may consider them a monopoly. There operating system is loaded with IE, which Microsoft owns.  In a complaint filed against Microsoft in the U.S. District Court of the District of Columbia on May 18, 1998, the Justice Department declares unequivocally that Microsoft possesses (and for several years has possessed) monopoly power in the market for personal computer operating systems.(U.S. v. Microsoft Corp, 1998). Think about buying a computer, you either by a MAC or another brand of computer that runs Microsoft Windows.
In 1997, prior to Steve Jobs returning to Apple as CEO, Apple was operating at a loss and Microsofts Windows 95 was flying off the shelves, (Time, 2009). This is where Bill Gates invested $150 million in Apple.
I believe that Bill Gates was trying to avoid being a monopoly and keeping their competition in the market to stay off of the governments radar. I also believe that although he invested $150 million in Apple, I am sure he gained much profit from having his software run on a MAC. I do believe Steve Jobs and Bill Gates knew exactly what they were doing and how this would result in future business for them both.
There were a few conditions under which Bill Gates would make the investment that benefited Apple:

MS Office and IE products were to be bundled with the MAC operating system.
Apple had previously filed a lawsuit accusing Microsoft of copying its operating system. This lawsuit was dropped as part of the deal, (Clifford, 2017).

Although Apple is the larger of the two companies today (Apples market capitalization is $839 billion compared to Microsofts $560 billion), in 1997 Microsoft was by far the larger of these two companies (Clifford, 2017). If Microsoft didnt step in and invest in Apple, it is highly likely that Apple would not have survived and this would make Microsoft a monopoly and could have government regulation imposed on the company.
Resources
Clifford. (2017, August 29). When Microsoft saved Apple: Steve Jobs and Bill Gates show eliminating competition isn’t the only way to win. Retrieved October 30, 2019, from https://www.cnbc.com/2017/08/29/steve-jobs-and-bill-gates-what-happened-when-microsoft-saved-apple.html (Links to an external site.).
Time. (2009, January 23). The Apple Revolution: 10 Key Moments. Retrieved October 30, 2020, from http://content.time.com/time/specials/packages/article/0,28804,1873486_1873491_1873461,00.html (Links to an external site.).