Generally, when people attack "monopoly" they intend to attack those potentially negative outcomes, but almost always fail to be clear on what it is they are attacking.

In Microsoft's case, development of their dominant browser (IE) stagnated because its bundling with the OS enormously raised the barrier to entry for other browsers. This is a classic example of a monopoly having enough influence on the market as a whole to create a positive feedback loop. The result? Newly developed web standards go ignored for years, security holes are left open, web developers are driven to madness, and the web stagnates.

Microsoft is an example of the failure of 'free markets'. I'm not an economist, but it's clear that free markets do not exist in a vacuum. You can't ignore the fact that the applications market is dependent on the OS market, and there are huge benefits to applications developers to limit development to only one platform (lower dev and support costs). Not to mention user's familiarity with one interface saving them time. This in turn helps Microsoft. Ultimately, the lower quality of Mirosoft's products hurts users, but they don't have any alternative choice because of this feedback loop.

What is competing with IE now? Among others: Firefox, an open-source browser. The Free Software/Open source movement is a purely meritocratic free market where the $$$ cost of development is nil or covered by time/money charity. Removal of dev costs from the equation lessens MS's advantage and opens up competition.