If you have enough control on the market you don’t have to actively try and stop competitors, you’re just the default solution and people automatically turn to you. Walmart doesn’t need to use dirty tactics to compete against mom and pop shops, the day they open people just start going to Walmart instead because they have everything in a single place.
That wasn’t always the case, and I don’t know if it’s currently the case. At least at one point, they would intentionally lose money by dropping their prices below profitability just to get mom and pop shops to shut down, and then raise prices back up to profitability. Or they’d force suppliers to cut costs only for them to the point where the supplier wasn’t making a profit, but by then they had stopped selling to competitors.
There’s a lot more evidence for Walmart committing anti-trust than Valve.
Point is, they don’t need to do that now because they’re dominant, they just have to come in with their big boots, sit at the table and wait until everybody leaves, they have unlimited money, they just need to offer the same prices as anywhere else, the convenience will kill the competition.
They won’t lose money if they lower prices of key products in one single store and just a bit lower than their competitor the moment it becomes a threat. And even if they did, they would make it up later by having the whole market share. It’s no different than, let’s say, Uber burning money initially to win against all competitors then raising prices when they become the default platform people trust.
They know that after they have the market, it takes a significant upfront investment to bootstrap a competitor, which can only be done with investors money, which at that point won’t bet on the smaller company with a boring business model.
If you have enough control on the market you don’t have to actively try and stop competitors, you’re just the default solution and people automatically turn to you. Walmart doesn’t need to use dirty tactics to compete against mom and pop shops, the day they open people just start going to Walmart instead because they have everything in a single place.
That wasn’t always the case, and I don’t know if it’s currently the case. At least at one point, they would intentionally lose money by dropping their prices below profitability just to get mom and pop shops to shut down, and then raise prices back up to profitability. Or they’d force suppliers to cut costs only for them to the point where the supplier wasn’t making a profit, but by then they had stopped selling to competitors.
There’s a lot more evidence for Walmart committing anti-trust than Valve.
Point is, they don’t need to do that now because they’re dominant, they just have to come in with their big boots, sit at the table and wait until everybody leaves, they have unlimited money, they just need to offer the same prices as anywhere else, the convenience will kill the competition.
I’m failing to see where the anti-competitiveness comes in.
They won’t lose money if they lower prices of key products in one single store and just a bit lower than their competitor the moment it becomes a threat. And even if they did, they would make it up later by having the whole market share. It’s no different than, let’s say, Uber burning money initially to win against all competitors then raising prices when they become the default platform people trust.
They know that after they have the market, it takes a significant upfront investment to bootstrap a competitor, which can only be done with investors money, which at that point won’t bet on the smaller company with a boring business model.
What does this have to do with Valve?