>>>If it's priced lower than what competitors can come in under, then it's more efficiently priced as a natural monopoly than if it were a competitive market.<<<
You never seem to address the future - only current prices. In this scenario, if we believe in it for the sake of argument for a moment, you have created a situation in which there is a disincentive to change or improve anything.
Smaller competitors have to have a survival price basis to come in with new products with better features. In your scenario, therefor, the older, less capable, porkier software product is allowed to squeeze out new, innovative products with artificailly low prices. Yes, the consumer gets the 'current' product cheaper. The trouble is that is all they can get.
But that's not the limit of this pernicious effect. A completely crappy product bundled with an operating system can virtually kill off every competitor even if there are a dozen competitors and they are all better products. That is because whatever additional functionality you get *at the margin* is obtained for the *full price* of the product - because you could have had the lesser level of functionality for 'free.'
Thus the crappy backup facilities in windows marginalize the backup program makers, the crappy compression facilities destroy the compression vendors, Notepad and wordpad marginalize the makers (like Borland's Brief) of source and text editors. None of these windows features is good enough to *buy* on it's own. And MSFT has little invested in them. Just enough to kill the market for any up and coming innovative software companies.
If you really believe in the scenario for IE that you propose, why isn't Office bundled? Why was Microsoft Mail server (postoffice) completely free and now for charge. It used to be a bundled, 'integrated' feature of the operating system. Now I can't even get my old email out of that system. I guess what can be integrated for the sake of us deserving consumers can be dis-integrated too. ;-)
However, we realize that monopolies generally raise prices and/or lower quality. This is true of national treasuries in the minting of money, the city's only opera house, or the only car repair business in town. The question is only how long it will take before that happens. Ask anyone who has paid thousands of dollars for a formerly free NT Server license pack.
Cheers,
Chaz
BTW, I hope that you can accept this verbal combat as just that and no more. I have the highest respect for your opinions. |
