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I don't understand why it's a different market. Do you mean that cartridges are just intrinsically different from the actual machine using the cartridges? This
by arthurcolle 12y ago
I don't understand why it's a different market. Do you mean that cartridges are just intrinsically different from the actual machine using the cartridges? This is identical to printers, so would you say the market for ink cartridges is different than the market for printers? On a literal level I suppose this is correct, but I wouldn't consider pens and pen ink to be different markets... Maybe I haven't thought it through enough.
- tricolon 12y agoEach proprietary cartridge type is a new market.
- rahimnathwani 12y agoA market (as far as economics or competition law goes) is demarcated by whether the items within it are substitutes, not by their intrinsic nature or subject. Examples: - Aluminium foil and cling film are both in the market for flexible food wrapping materials - Aluminium foil and aluminium rulers are _not_ in the same market, as they are not substitutes (alternatives) In cases where it's not clear whether two items are in the same market (e.g. tea bags and instant coffee powder could be considered substitutes) competition regulators will use historical price data to estimate the XED (cross-elasticity of demand) between two products. If XED is high (e.g. a reduction in the price of tea bags significantly reduces demand for instant coffee powder) then the two goods are substitutes, and are deemed to be in the same market. Now, apply this to your coffee pod/machine and pen/ink examples.
- Drakim 12y agoIt seems to me that they are very much different markets, just like how gasoline and cars aren't the same market. Why would the company that makes electronics also be responsible for making ink? The only reason we even have that idea is because the ink comes in a somewhat electronic package.