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Isn't this a textbook definition of predatory pricing and illegal in the US? WeWork’s strategy wasn’t simply to fulfil a practical need: its aim was market dom
by tolstoshev 7y ago
Isn't this a textbook definition of predatory pricing and illegal in the US?
WeWork’s strategy wasn’t simply to fulfil a practical need: its aim was market domination, to be achieved by undercutting its competitors in a race to the bottom, using investor capital as oxygen to sustain losses while other serviced office-space providers ran out of breath and expired. The idea was then to leverage its reach to name its terms and prices.
- wjnc 7y agoYes, it looks like an attempt at predatory pricing. It didn't succeed though. I have no specific knowledge of US antitrust, but usually for predatory behavior to 'stick' you need to have market power to begin with. WeWork didn't have any and wasn't really near the point of having any when they went bust (40% market share is a commonly heard number). Another plus for current capitalism and regulation is that the fillings the SEC demands really brought home what was wrong with WeWork. So in that sense investor protections in the current rules really did help. Mainly (professional) suckers lost their money.