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> Why does it scare you? Why do you think it's dangerous and bad? > It's a well-established, economically rational business model to subsidize prices in order
by yjftsjthsd-h 2y ago
> Why does it scare you? Why do you think it's dangerous and bad?
> It's a well-established, economically rational business model to subsidize prices in order to gain market share.
Because once they have the market share, they raise prices and/or make the product worse in order to get their money back.
> And users don't really need to be concerned. Just enjoy the low prices. If the service you use goes out of business, it's pretty easy to switch to another.
Well that's the question, isn't it? If the market stays healthy and they don't take the oxygen out of the room and kill the competition and switching costs stay low, then yes by all means enjoy the free ride but plan for its end. But... do plan for it.
- worldsayshi 2y ago>they raise prices and/or make the product worse in order to get their money back They should only be able to do that if they have a considerable moat though?
- eitally 2y agoI think the bigger risk is that they don't get the market share and then they're tempted to make unethical decisions to keep afloat as their unbalanced inputs & outputs start to drive increasing pressure from their investors.