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Re: What does a digital platform mean for Bills in London?
It's always somewhat mistaken to analogize digital goods to tangible ones, but the parking lot analogy is a decent one that would benefit from expansion.
Let's assume that in downtown Analogyville, company A owns the best parking lot. If you don't park there, two miles away is a free for all of street parking and other budget solutions. In a parking space neutrality situation, it doesn't matter what make of car you arrive in, the cost is the same and you are allowed entry. Now, admittedly you may wind up with some jackwagon abusing this situation like your limo driver above. So the city abandons parking lot neutrality and lets the companies fend for themselves.
Company A then decides that car manufacturers that pay them a premium get a guaranteed space downtown whenever they want it. In the event that the lot is full, they will find another manufacturer's car and tow it. Manufacturer X is big and established, so they can afford this premium. Manufacturer Y is newer and more innovative, but doesn't have the startup capital to pay it.
So what happens? Imagine you are a business owner and deciding what car to buy. Car X is more expensive because it has the guaranteed parking spaces. Car Y might be better suited to your needs, but you are a business man. You need to get to clients, and if your car gets towed then you are totally screwed. If you park two miles away and have to spend 20-30 minutes walking each way to your car you are at a huge disadvantage to your competitors. So now you have to buy from X, paying more for the car so X can cover the cost of the premium paid to A. Manufacturer Y starts losing business and is unable to compete in the market. In the "best" scenario, X purchases Y and incorporates Y's ideas into their own cars. In the worst case, Y simply folds and takes their innovation to the grave. Investors who were thinking of creating car company Z recognize that without the startup capital to pay A's premium, they can't survive in the market and the company never forms.
So what you wind up with is one parking lot company, one car company, and both of them charging consumers extra because of their consolidated monopoly power.
The NFL has been sued on all three of those grounds and lost each time. First, Al Davis sued the NFL for blocking his move to Los Angeles and won, so the team moved in the 1980s. Second, the USFL sued on antitrust grounds and they too won, however the damages were so small that the league folded anyway. When the XFL formed, they were able to use some NFL venues as a result of that suit. And American Needle sued because the NFL awarded an exclusive hat contract to New Era (pretty close to the hypothetical situation above actually) and the NFL lost at the Supreme Court 9-0.
The NFL, legally, is on some shaky ground. However, nothing will actually happen about it because challenging them involves billions and billions in upfront costs.
Exactly like the big telecom companies.
Originally posted by stuckincincy
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Let's assume that in downtown Analogyville, company A owns the best parking lot. If you don't park there, two miles away is a free for all of street parking and other budget solutions. In a parking space neutrality situation, it doesn't matter what make of car you arrive in, the cost is the same and you are allowed entry. Now, admittedly you may wind up with some jackwagon abusing this situation like your limo driver above. So the city abandons parking lot neutrality and lets the companies fend for themselves.
Company A then decides that car manufacturers that pay them a premium get a guaranteed space downtown whenever they want it. In the event that the lot is full, they will find another manufacturer's car and tow it. Manufacturer X is big and established, so they can afford this premium. Manufacturer Y is newer and more innovative, but doesn't have the startup capital to pay it.
So what happens? Imagine you are a business owner and deciding what car to buy. Car X is more expensive because it has the guaranteed parking spaces. Car Y might be better suited to your needs, but you are a business man. You need to get to clients, and if your car gets towed then you are totally screwed. If you park two miles away and have to spend 20-30 minutes walking each way to your car you are at a huge disadvantage to your competitors. So now you have to buy from X, paying more for the car so X can cover the cost of the premium paid to A. Manufacturer Y starts losing business and is unable to compete in the market. In the "best" scenario, X purchases Y and incorporates Y's ideas into their own cars. In the worst case, Y simply folds and takes their innovation to the grave. Investors who were thinking of creating car company Z recognize that without the startup capital to pay A's premium, they can't survive in the market and the company never forms.
So what you wind up with is one parking lot company, one car company, and both of them charging consumers extra because of their consolidated monopoly power.
Originally posted by stuckincincy
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The NFL, legally, is on some shaky ground. However, nothing will actually happen about it because challenging them involves billions and billions in upfront costs.
Exactly like the big telecom companies.
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