Does knowing that Wal-Mart is pressuring studios not to make downloaded movies available for prices below DVD prices affect anyone's thoughts on this subject?
If we are assuming that having a monopoly, a trust, or a monopsony is legal, as it seems to be nowadays, then virtually anything that any business will do falls into the category of either A) engaging in anticompetitive behavior, or B) going out of business.
I disagree. Calvin Trillin has a piece about the premium ice cream wars, in which Haagen-Dazs tried to put Ben & Jerry's out of business by refusing to supply stores that stocked B&J. This was anticompetitive monopoly behavior because it interfered with the relationship bewteen two other parties, IIRC. (The legal issue was whether H-D had a monopoly; the ruling was that they did, since premium ice cream was a separate market from ice cream in general, and H-D had more than the required share of that market.)
What Wal-Mart is doing strikes me as no different. They're not using their monopsony power to offer lower prices or to buy at lower prices, they're using it to damage anyone who deals with a third party on terms they don't like. It's obvious that this deprives consumers of the benefits that a free market theoretically yields.
It likely isn't illegal to pressure studios to not supply digital versions to other suppliers cheaper than they supply DVDs to walmart. Walmart can say they are just tring to negotiate the best price.
Does Wal-mart deal in consumer electronics as I think they do? Because if so, they could reasonably expect to sell more iPods if movies were available on them for cheap. Right?
Microsoft has already released a critical patch for the WMV exploit. It was particularly remarkable because Microsoft caught flack not too long ago for moving to a slower, monthly patch schedule instead of their previous policy of just releasing fixes as soon as they became available. So security vulnerabilities on customers' machines can now linger. But when DRM and, therefore, partners' revenue streams are threatened? Surprise surprise, Microsoft hopped to it.
This shouldn't be interpreted as permanently fixing the WMV-cracking problem; those committed to it will just refuse to install the patch. There's also a strong possibility that pirates will release packs of rolled-back DLLs that let you install the crack software. But the average consumer with auto-update on will now find that the WMV-cracking software no longer works.
Does knowing that Wal-Mart is pressuring studios not to make downloaded movies available for prices below DVD prices affect anyone's thoughts on this subject?
(From the estimable Ezra Klein )
Posted by Doug | Link to this comment | 09-11-06 9:20 AM
It makes me think even more that Wal-Mart sux.
Posted by ben wolfson | Link to this comment | 09-11-06 9:30 AM
It makes me think how could that not be anticompetitive behavior? Perhaps it's legal, but it surely shouldn't be.
Posted by Matt Weiner | Link to this comment | 09-11-06 9:31 AM
If we are assuming that having a monopoly, a trust, or a monopsony is legal, as it seems to be nowadays, then virtually anything that any business will do falls into the category of either A) engaging in anticompetitive behavior, or B) going out of business.
Posted by Cryptic Ned | Link to this comment | 09-11-06 9:43 AM
I disagree. Calvin Trillin has a piece about the premium ice cream wars, in which Haagen-Dazs tried to put Ben & Jerry's out of business by refusing to supply stores that stocked B&J. This was anticompetitive monopoly behavior because it interfered with the relationship bewteen two other parties, IIRC. (The legal issue was whether H-D had a monopoly; the ruling was that they did, since premium ice cream was a separate market from ice cream in general, and H-D had more than the required share of that market.)
What Wal-Mart is doing strikes me as no different. They're not using their monopsony power to offer lower prices or to buy at lower prices, they're using it to damage anyone who deals with a third party on terms they don't like. It's obvious that this deprives consumers of the benefits that a free market theoretically yields.
Posted by Matt Weiner | Link to this comment | 09-11-06 9:54 AM
It likely isn't illegal to pressure studios to not supply digital versions to other suppliers cheaper than they supply DVDs to walmart. Walmart can say they are just tring to negotiate the best price.
Posted by joeo | Link to this comment | 09-11-06 12:38 PM
Does Wal-mart deal in consumer electronics as I think they do? Because if so, they could reasonably expect to sell more iPods if movies were available on them for cheap. Right?
Posted by Clownæsthesiologist | Link to this comment | 09-11-06 12:43 PM
Microsoft has already released a critical patch for the WMV exploit. It was particularly remarkable because Microsoft caught flack not too long ago for moving to a slower, monthly patch schedule instead of their previous policy of just releasing fixes as soon as they became available. So security vulnerabilities on customers' machines can now linger. But when DRM and, therefore, partners' revenue streams are threatened? Surprise surprise, Microsoft hopped to it.
This shouldn't be interpreted as permanently fixing the WMV-cracking problem; those committed to it will just refuse to install the patch. There's also a strong possibility that pirates will release packs of rolled-back DLLs that let you install the crack software. But the average consumer with auto-update on will now find that the WMV-cracking software no longer works.
Posted by tom | Link to this comment | 09-11-06 9:13 PM