[withinboredom]

> Predatory pricing is supposed to involve a corporation raising prices after destroying it's competition.

Why would you raise prices after? That would just invite competition again. Keep the prices low and competitors away. Maybe raise them to at-cost, but if your Widgets can comfortably cover the cost, then there is no reason to raise prices.

[username332211]

> Why would you raise prices after? That would just invite competition again. Keep the prices low and competitors away.

The assumption of predatory pricing is that it's not easy for a competitor to just show up. Supply chains would be destroyed, capital equipment scrapped, etc and replacing them would be time consuming and expensive.

Sometimes that's a reasonable assumption to make, sometimes it's not. Even if the assumptions are unreasonable, many CEOs won't let mere reason stand in their way.

> Maybe raise them to at-cost, but if your Widgets can comfortably cover the cost, then there is no reason to raise prices.

So, the Widget-making capital would just sit there producing 0 ROI? Someone's gonna object to that. A company pursues market dominance to make money.

[withinboredom]

Haha. That’s a short-sighted strategy if I ever heard it. Why would you play a long-game like this to play a dumb short-game at the end? No, what you do is make it so you can no longer buy “just Widgets” you can still get your cheap Widgets through us, but you can only get them buy buying a Sprocket & Widget bundle. We are so sure you’ll love our Sprockets too!

Nobody can compete with you on the price and it is clear you can unbundle your Widgets from your Sprockets at any time if you ever feel threatened.