2 ms·
Which? What product do they not have an abundance of competition in? I mean they have the minority market share in every category.
by Clubber 9y ago
Which? What product do they not have an abundance of competition in? I mean they have the minority market share in every category.
- dragonwriter 9y agoPricing power isn't defined by descriptive categories, it is defined by behavior (whether they can increase prices without sales moving to competitors.) It's a test that exists because there are an infinite number of ways to construct named categories of products, which can create any appearance you want, but none of them tell you if things in that category are genuinely competing with each other.
- AnthonyMouse 9y agoMore to the point, using the category "iOS app distribution" pretty clearly leads to the conclusion that Apple has pricing power there.
- Clubber 9y agoApple doesn't set prices for the apps they distribute except for their own apps. The developers do.
- AnthonyMouse 9y agoThat's not the price of distribution. The price of distribution is Apple's cut.
- ProAm 9y agoCan developers sell you iphone software without Apple in the middle?
- Clubber 9y agoNot easily, but they certainly can sell Android software.
- Clubber 9y agoThe person I was responding to wasn't talking about pricing power, they were talking about monopolies. Apple isn't anywhere near a monopoly in any commodity or service. In fact, they compete with the near monopolies of Microsoft and Google. Also, being a monopoly isn't in and of itself illegal, it's abusing your monopoly position to harm competition. You have to be a monopoly first.
- dragonwriter 9y agoPricing power is a test for whether a monopoly exists; it tests for actual practical competition rather than the presence of other participants in a decriptive category which may not actually compete in practice.
- IBM 9y agoIt may be a test but having pricing power doesn't mean they're a monopoly. They have pricing power because they deliver more consumer surplus in their products than what they capture. Even in the case of the iPhone business having rising ASPs most of that has come from segmentation of the customer base into higher end models rather than simple price increases. You don't need to have a monopoly to have pricing power, your product just needs to be differentiated enough.