Linked by Dmitrij D. Czarkoff on Fri 31st Aug 2007 08:54 UTC
Editorial This article is an answer to "Competition Is Not Good" by Kroc and reading it wouldn't be comfortable without switching to and from the original article. I wrote it just because I do strongly disagree with Kroc and I believe I can prove that he is not as close to truth as it may seem from the first glance.
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I agree
by bralkein on Fri 31st Aug 2007 10:10 UTC
bralkein
Member since:
2006-12-20

I agree with this article. I thought Kroc's article was completely off the mark, (no offence man) but I did agree with some of the sentiment expressed therein. Things like proprietary "standards" designed for customer lock-in, DRM and monopolistic domination of markets are all bad things. However, the reason that they are bad is that they all prevent comptetition.

Kroc lamented the lack of open standards due to competitive corporations attempting to corner the market, but in fact open standards have no meaning outside of a comptetitive context, almost by definition. He cited the audio CD standard as being an example of the success that an open standard can be, but he failed to appreciate that competition within the industry guaranteed the value and ubiquity of the standard. Would you really be able to buy a couple of hundred CD-Rs for a fiver if there was no competition between the manufacturers?

Despite its title, Kroc's article seemed to imply that competition is in fact beneficial, but that greater control is necessary to avoid the problems that can arise. I think that we simply need to see more government intervention in these cases, similar to what we've seen recently with the European Comission vs. Microsoft.

Reply Score: 4

RE: I agree
by SReilly on Fri 31st Aug 2007 11:06 in reply to "I agree"
SReilly Member since:
2006-12-28

Agreed. What you are saying is very much what I have been hearing from economists for years now. Government regulation of markets and businesses is a must for a healthy economy.

Often, I hear the free market and free market economics hailed as the bastion of freedom when, time and again, a truly free market has been proven to limit customer choice. One good example of this is that without intervention, we would have more monopolies.

In fact, the deregulation of markets has often proven to be detrimental to the market itself. Take WorldCom and Enron as two prominent examples. Also, most of the worst stock market hiccups and crashes have been the direct result of nonregulation/deregulation.

Competition is, IMO, healthy but true competition is only possible when all parties are made to play fair.

Reply Parent Score: 3

RE[2]: I agree
by ddc_ on Fri 31st Aug 2007 11:47 in reply to "RE: I agree"
ddc_ Member since:
2006-12-05

That's just one school of economics, while other exist. The monopoly is not as bad as it is considered untill there's some unbreakable way to force competitors to shut down. In software there is such a way: copyright. In hardware no such barrier exists, so monopoly is just no bad thing. See the PC processor market history for example.

Reply Parent Score: 2

RE[2]: I agree
by dylansmrjones on Fri 31st Aug 2007 12:05 in reply to "RE: I agree"
dylansmrjones Member since:
2005-10-02

Government regulation of markets and businesses is a must for a healthy economy.


Negative. That is definitely what the healthy economy does NOT need. Government regulation is the situation to day and we don't have healthy economies.

Healthy economy can only become reality through the absence of government regulation. Government regulation is the reason why software patents exist. Government regulation upsets the market and creates instability and stagnation, followed with regression and ever-increasing national debt and inflation. Politicians don't understand the market and therefore should not intervene. Intervention is bad.

Reply Parent Score: 3