Quote:
Originally Posted by crossi
The difference between predatory pricing and a loss leader isn't intent it's overall profit. If someone discounts one popular item to get people into their store even if they sell THAT item at below cost not just at a smaller profit it's still not predatory if their store overall is making a profit. Plowing their profit back into expansion or research doesn't count as "not making a proifit" just wise use of their income.
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That is my understanding as well, all though, if you are using the profits from other parts of your business as a price support for the loss leader side, that can also be predatory pricing. This is what the Standard Oil case was about. Standard Oil was big enough that they could drive a local company out of business by charging less in that area and using the other areas of the country to cover the loss. Thus, the point in the various legal documents about if Amazon was making money or not with the the ebook side of their business verses the whole business.
Anti-trust is a very iffy area of the law. The standards have changed and are changing over time. We currently are in a time where the standards are a bit looser than they were back in the 60's.