| Mark2008 said:
... |
Throughout our school days we're all taught that monopolies are a bad thing. They hurt small businesses, and they cause progress to slow down.
What we aren't taught is that this concept is not true for every market. The operating system market (Windows, OS X, Linux, etc.) is one where this "rule" fails. Video game systems are another.
The key difference between these "platform products" and just about everything else is that, from a standpoint of economic importance to the world, platform products do more in the way of creating markets than they do in the way of competing in markets that already exist.
Look at Windows as an example. Because Windows is used by close to 90% of the market, thousands and thousands of software companies have been able to spring into existance and create products that can reach the largest possible audience by supporting only a single platform. There are entire genres of products for niche markets that are only feasible because of this "universal language" we call Windows. For many of these tiny software markets, an OS market split evenly between 2 or more OS's would mean there would not be enough customers on any single platform to support the companies. Many companies would simply no longer exist in such a market, as there wouldn't be any extra income to support the extra costs involved with supporting multiple platforms. The average quality of the software would drop significantly, as money that would ordinarily be spent on debugging and feature development would instead be put into cross-platform development, new support costs, etc. Feature selection would be reduced, as most developers would choose to pick features that can only be done on all platforms. And finally, competition would also be reduced as many companies would be forced to compete on only one platform, thereby reducing the total amount of competition between companies in each market.
The video game system market is a little different, since you don't see the 5000 person niche markets that you see in the software industry. But many of the same results can be seen. Many game companies take the approach of developing their software for multiple platforms, choosing only features and functionality they can make work relatively equally on all platforms. As a result, quality is driven down as many games are not designed to take full advantage of their systems. A split system market also means that exclusive titles can not receive the financial input that they would if the market was dominated by a single console - the market is just too split to allow it. Again, the quality goes down, not up.
If there's one thing that we all (including the EU) should have learned from history by now, it's that the world market naturally gravitates in the direction of platform monopolies, simply because they offer the most advantage for the most people (companies and consumers). Attempting to control and prevent them is damaging.
