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Article #7

Correction: monopoly powers in the tortillia chip market, an analogy (was: Re: Texas fighting to keep Windows 98 out of Texas!)

#7
From: David W. Richardson
Date: Fri, 01 May 1998 00:00
59 lines
3669 bytes
Oops, a proofreading error probably confused you - I should have said
mine salsa was "built in" instead of "free".

Here's the corrected analogy
(followups to alt.flame.ms-windows)

I control 80% of the market for tortilla chips.  My cooks have come up
with a salsa recepie, but it's having a hard time getting more than 20%
of the market share, despite the fact that both I and my competitors are
giving it away (my chief competitor has 50% of the market, and its
obsolete predecessor has 20%).  So, with each package of chips, I
include a bottle of salsa.  The other salsa vendors are furious, because
why would anyone buy their salsa when mine is "built-in" and (almost)
just as
good?
Now I have 40% of the salsa market and climbing (my chief competitor is
down to 40%), and expect to peak at about 70% (it would be 80%+, but
some people prefer other salsas enough to use them and go to the trouble
to throw mine away, and not everyone buys my tortilla chips anyway).

My competitors and the government are going to court to get me to
"unbundle" the products.  Under that pressure, we've given grocery
stores the option of buying the chips without the salsa (it's the same
price) but most of them go with the bundled package, since it doesn't
take up any more space on the rack [ok, it does, but pretend it doesn't]
and its easier to sell.

Now, who's right?  Should I be forced to unbundle?  What if I do take
over the salsa market & people quit making alternative salsas, even
though they were better?  It's not like the other salsas can bundle
themselves with a dominant tortilla-chip-maker, (remember, I have 80% of
the chip market)?  What if, after I corner the chip and salsa markets, I
let quality slide a little or prices go up a tad, but not enough to make
anyone willing to seriously compete with me in the face of my 70-80%
market share?  Now that I've conquered the chip & salsa market, maybe
I'll throw bottled water into the mix next (gotta wash down that salsa).

For those reading with blinders on:
I = Microsoft
tortillia chips = MS 95
salsa = web browsers
my salsa = MS Explorer
Other salsa vendors = NetScape
NetScape's obsolete predecessor = NCSA Mosaic, owned by Spry, programmed
by some of the same people who founded NetScape.
Other tortilla-chip makers = OS/2, Linux, Novell, MS-DOS, DR-DOS,
PC-DOS,
          MS-Win31, etc. and maybe non-Intel OSes like MacOS, Solaris,
etc.
grocery stores = hardware vendors who preload OSes on their machines
bottled water = whatever's next on Bill Gates's radar screen

Disclaimer:   all market-share figures are totally made up.

-- headers forged, use --
-David W.    davidwr@       Make your web pages accessible to the
 Richardson  geocities.com  handicapped: http://www.cast.org/bobby
 Remember, just because you see it on the 'net doesn't mean it's true.
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From: "David W. Richardson" <davidwr_at_geocities.com@geocities.com>
Subject: Correction: monopoly powers in the tortillia chip market, an analogy (was: Re: Texas fighting to keep Windows 98 out of Texas!)
Date: 1998/05/01
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