Quote:
Originally Posted by JoeD
Is it still a free market when those who are colluding to raise prices are also putting pressure on any competitors who decide to price differently? For example by not allowing a certain publisher to get their book app on the iOS app store.
I have no problem with individual companies setting high prices, if it's more than I'm willing to pay, I do without or go elsewhere. However, that works under the idea that a market will eventually adjust and if prices really are too high it opens room for a competitor to enter. Collusion prevents that.
|
exactly. Few people realize this "Agency" model has been in place in our grocery stores for over a decade now. Only they call it JIT (just in time purchasing) where everything on the shelf is basically on consignment.
Notice that major grocery stores no longer have night stalking crews to restock shelves? It's because the shelves are now stocked and maintained by the distributor for most everything in the store.
Prices too are not set directly by the store. Even sales are non-competing because the same vendor stocks the shelves in every store in town (I'm in a small town but we eat so there are 4-major and two minor groceries with a soon to be completed Walmart Superstore renovation adding a 5th major chain grocery. I'm not sure how Walmart handles their grocery though.
No matter the Agency model along with a court decision on MAP pricing has all but ended the "free market". Sure new companies can try to get into the mix but good luck with that as the capital needed to even get a toe in the water makes it impossible to even get the major retailers to answer the phone. The production capacities for start-up goods producers is next to nil. Fact it the major brands have the production capacity already tied-up. That was what Apple did with the iPhone...they pre-purchased all the production capacity of components the assembly facilities. Well not all but enough to influence the market and they is why other companies lagged, there was simply nowhere to make the darn things let alone the buy the guts to put together.
Face it people who understand what wheeling-n-dealing in business was are a dying breed. There are executives today who never will know what a real sale is...they never shopped around for anything to find a good deal. they just went to the widget place and paid the price because that was the way it is done today. Heck today kids feel a couple grand a year in fees for that cell phone in their hand is just fine or their devices need only last until their next "upgrade" period occurs. They don't get it that they are really paying 3-4x the value of that phone before the monthly fees. Good marketing but bad for society long term. Money out of the hands of those who work for a living into the coffers of faceless corporations.
And none of this is to make life better for people or society only for the tiny slips of paper with numbers and images on them and the peepholes who hoard them. Well to paraphrase HhGTTG anyway.
Sigh, I remember complaining when my phone bill was $12/mo back in college. yeesh....