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To: Maurice Winn who wrote (6504)	12/15/1997 2:05:00 PM
From: dougjn	Read Replies (1) \| Respond to of 152472

The barriers to entry for competitors to G* are very, very high. Takes years to design a system. Only two or three other Cos have the expertise to do it, I believe. The launch capacity has to be reserved way in advance. And of course it costs billions, which will probably be the least of it going forward, but has had a big impact on keeping the initial entrants to two. G's ability to withstand competition is also helped considerably by G's exclusive right to CDMA form Leo narrowband (telephony). (Anyone know for how long?) N'est pas? Doug

To: Maurice Winn who wrote (6504)	12/15/1997 2:08:00 PM
From: qdog	Respond to of 152472

Yeah he is as smart as a drug dealer; get em hooked and they keep coming back for more and more. Maybe there is a business there, qdog's computer addiction center. Mantra "I don't need to upgrade at high prices, my buggy software".

To: Maurice Winn who wrote (6504)	12/15/1997 2:28:00 PM
From: kech	Read Replies (1) \| Respond to of 152472

Jeesh - Maureesh - I'm supposed to be grading and I do want to thank you for not having any spelling mistakes in your diatribe! I turn to this happy forum for relief and it is no small pleasure to have to exercise a different side of the brain to respond to you. Sadly I have to resourt (so sic - this is NZ/Brit spelling) to ECONOMIC THEORY. As you acknowledged i.e. power distribution, there are many types of industry in which there are natural monopolies. I suggested RR's as well but you didn't like that one. It is possible for everyone to erect their own power distribution line to their house or to run their own gas powered generator. But this would be COSTLY. There are cheaper alternatives - i.e. a common power grid from which we all can run a line. The problem is that this MONOPOLY would allow the owner to charge prices that are much higher than cost, but presumably just below the cost and inconvenience to you of running your own power generator with its associated noise. Also note that if everyone had their own gas powered generator it would annoy the happy sheep gamboling in their fields and would not provide the ideal bucolic NZ setting for them. Anyway, in civilized economies where extreme libertarians are not allowed to run free, there is regulation of these natural monopolies. Everyone is much happier than having to get up at night to run their own gas powered generator. This is an encumbrance on the property rights of the monopolist but in general the benefits gained by citizens in this state more than offset the forgone profits of the utility. Now Maureesh - you can argue that there are many fewer so-called natural monopolies than one might think. You listed many alleged monopolies that may be assaulted. I would on any other day take your side that there is competition for getting the monopoly, which is usually transient anyway. In addition, the monopoly profits on the transient monopoly are often considerably less than the benefits to consumers from the innovation and gains in efficiency that were necessary to establish the monopoly in the first place (see QCOM). But still, there may be many monopolies that don't have this characteristic, are less transient, and are more likely to be abused by using monopoly in one stage to drive out competition in another. Se e the vertical squeeze and U.S. vs. Alcoa.