Benedict Evans wrote:
> > <snip> ... assuming there was no collusion (and there's no reason to
> > believe there was), whose business is it what the mobile operators want
> > to charge for roaming? They aren't charities, or monopolies. The EU
> > going in and seting their prices makes about as much sense as it
> > telling Cocacola and Pepsi what they can charge.
Benjamin sings harmony:
> Absolutely right. I believe the market can sort this out by itself. It
> is however a reality that the EU is undertaking something that appears
> to have a positive effect on the way operators think of roaming.
Virtual cartelization doesn't require explicit collusion. You can do all
the intercorporate whispering you want with price signals and competitive
passivity alone. This is why anti-trust law has traditionally been a
"guilty until proven innocent" legal craft.
The fact that the EU is undertaking anything at all is evidence enough that
market forces can fail concretely, which is something that no reputable
economist denies these days, no matter how abstract his or her specialty.
(For whether this EU case is being taken up pro forma, or for real, see my
earlier comments.)
> To take your example with Coca Cola and Pepsi the analogy would be
> something like both Coca Cola and Pepsi to not wanting to sell cheap
> tin-can drinks out of vending machines but insist on selling their
> drinks in vats only and for them to only be served "draft" by specially
> trained staff making it more expensive and only attractive to few soft
> drink drinkers who are willing to pay a premium for an upmarket drink.
Bzzt. Vary Bad Analogy. Coca Cola owns the taste of Coke (and the brand
presence.) Pepsi has its own analogous IP domain. Neither simply sell
flavored fizzy water from vending machines. Quite the contrary: they would
fight tooth and nail, and out of a joint defense fund, if there were some
intercontinental law (enforced by who? Martians?!) requiring them to
peddle their respective brands in generic containers that said "Coke" and
"Pepsi" on the reverse side, in fine print (with that fine print being only
for consumer litigation purposes.)
Seamless intercontinental roaming would be precisely that kind of
commodification. It would expose telcos to something that most companies
cringe at. Namely: unbridled cost competition.
-michael turner
leap@gol.com
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Received on Fri Oct 12 11:59:23 2001