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by pantalaimon 108 days ago
> segment leaders can simply use their capital to prevent challengers instead of competing on product/service quality

This is done through regulations. If you are the market leader, you have the resources to comply with new bureaucracy (that you lobby for through standards organisations) and you don't really want to do much risky new development so ossifying your product is fine. That makes it really hard for new competitors to enter the sector.
2 comments
AlotOfReading 108 days ago
Standards and regulations are simply one tool, and not even the most common one. In the US auto market for example, standards besides FMVSS (and IHS testing practically speaking) are purely optional. You can read FMVSS for free and compliance is self-certified. Emissions regs are slightly tighter, but not a hurdle for EVs.

And outside automotive there's plenty of leaders that don't dominate based on regulations. Google search doesn't dominate based on regulations. Spotify doesn't dominate because they enshrined themselves in copyright law.

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roughly 108 days ago
It's also done through acquisitions, anticompetitive practices, exporting externalities, and exploiting consumer information asymmetries.
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