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nelziq

2 years ago

in Against Platform Monopolies: Introduction on The Technology Liberation Front
First, many of the benefits that you site would also be applicable to say a monopoly on shoes or sugar. Who is going to invest in an expensive shoe factory if they don't have a monopoly on shoes that will allow them to recoup their profits? I think any of the numerous arguments against enforced monopolies are applicable here. Second, you need to consider alternative uses of resources. For example, in your HP printer hypothetical you state:

So here we have an argument for giving HP the right to exclude generic cartridge makers from making cartridges compatible with its printers. Such a rule could have two beneficial effects: first, it could increase the total profitability of designing printers, thereby stimulating the development of additional printer. And secondly, it could enable HP to lower the price of its printers, thereby bringing them within reach of more customers (this assumes that the light users are also the most price-sensitive, a not unreasonable assumption).

Increasing profitability of making printers is not neccessarily a good thing. We could arrange the laws such that killing kittens or building glass houses are very profitable enterprises, but that doen't imply that we should do so. There is an efficient amount of printer production that should be done and simply increasing that amount isn't neccesarily a good thing. With such laws the economy may be wasting too many resources on printers rather than on other goods. As to your second point, this imbalances the production of printers vs. ink. Perhaps we would be better off in a world with fewer more expensive printers and much more cheap ink available.

2 years ago

in The Economist on iTunes on The Technology Liberation Front
I think the lock in effect of the answer. For example that $399 video iPod can hold 10,000 songs, which would cost you $10,000 if purcahsed legally through iTunes. It seems unlikely that a user with $10,000 worth of music will switch to a different music player that renders his library useless.
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