| >several airlines have remained profitable Thiel's point is that the industry as a whole in not especially profitable if at all. This has been true in most countries where there is free competition. In a competitive market you would expect the best companies to to make money and the least good to lose it or go bust. Here's some Buffett quoteing on the matter: >Back in ’95 in an interview with UNC TV, Buffett pointed out that the airline business in the U.S. “has made no money.” >Thanks to Wilbur and Orville Wright and their adventures on the Outer Banks, North Carolina is known as “first in flight.” But Buffett didn’t let that history stop him from making a sarcastic remark about investors’ attitude toward the Wrights. >“If there had been a capitalist down there, the guy would have shot down Wilbur,” Buffett said. “One small step for mankind, and one huge step for capitalism.” He was joking or course. Interestingly Buffett has returned to aviation but with a business that is what Thiel would call a monopoly - Netjets. They have the vast majority of the fractional private jet rental business. |
I think computer hardware (especially memory or hard drives) would be a better historical industry to point to for incredible value created and precious little retained due to a hyper competitive market.