PATHOLOGY OF POINTLESS COMPETITION

[ulTRAX]

Capitalism is a dual edged sword. Competition can drive prices down... often though streamlined production. But despite what free market proponents claim, competition isn't efficient... it's incredibly wasteful. We tend not to see it because we've been brought up to think that monetary transactions are true indicators of economics. We look at features and price... and there seems to be price competition. So the lie lives on. It's only if you ask different questions does the waste become apparent. Warning! Thought crime alert!

For example, could a product could have been better at a lower price if corporations cooperated to work together to create one superior product... compared to numerous inferior proprietary ones?

Take the simplest example.... the Beta vs VHS war of the 80's. Beta had better picture quality and VHS had better run time. Neither format would be as good as if Sony and JVC combined the best features of their respective systems.... then competed to lower prices on hardware. Instead there was a costly format war. I don't know if anyone's done a study of the price consumers paid for this war... but it had to be immense. What were the costs of overhead for developing, manufacturing, distributing and marketing two incompatible formats? What price did consumers pay for that incompatibility in not being able to share tapes? How much more expensive were prerecorded movies to make for two formats... where each tries to get exclusives? What is the cost of less selection in stores to handle the duplicates tapes in two formats? What was the cost to consumers of junking the their investments in Beta machines and tapes? What was the additional cost having then having to buy another VCR?

The Beta vs VHS war was a classic example of when corporations engage in such pathological competition... consumers LOSE.

I know, I know.... this is the way capitalism works. Well... not really. There are OTHER product development models based on corporate cooperation. Take the DV digital video system. Trying to avoid another Beta vs VHS war.... the electronics industry formed a consortium to create the first consumer digital video format. It included the best ideas of the industry. Similar cooperation occurred developing the DVD disk. We all gained by a speedier product introduction because consumers didn't have to put off a purchase worrying they were buying the next Beta. Of course corporations will be corporations. Getting back to the DV format.... as soon as the consumer standard was finalized both Sony and Panasonic announced 2 incompatible pro versions of DV. Obviously both wanted to trap professionals in a proprietary monopoly if possible.

But I have to imagine the benefits to consumers if there was more corporate cooperation.... in everything from videogame consoles... to air cleaner filters.... to prescription drugs where pharmaceutical companies piss away precious resources reinventing each other's where.

[dumpster_baby]

1. they will do whatever is needed to keep us scrambling

With public transportation starved for funds, and segregated nieghborhoods still the reality, the "higher mortgage/good neighborhood"/commuting scramble is ratcheted up more every year.

They have starved immigration enforcement so that as many 3rd worlders as possible can come here. As long as most every town or city in America is a direct pipeline to the population cornucopia of the ever-needy 3rd world, America will continue to be ever more competitive, with people from every 3rd world country scrambling for a living here in our cities.

Feel like you are in a rat race? It is no accident! How can corporate profits increase every year unless the vice tightens every year? Silly rabbit....

[ulTRAX]

2. how can profits increase?

dumpster_baby wrote: "How can corporate profits increase every year unless the vice tightens every year?"

I think it's clear that there can be mixed models... of corporate cooperation AND competition. DV and DVD proved that. There can be win-win solutions in a competitive world.