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Forums - Gaming - I don't get why we can't just co-exist peacefully!?

forevercloud3000 on 03 December 2013
toastboy44562 said:
Xbox One releases in North America, South America, Australia, and UK. PS4 releases in the rest of Europe and Japan and picks up the scraps everywhere else. Nintendo Has control over the handheld market. Wouldn't everyone be happier if they had their own place? Why do we have to compete?!?




      

      

      

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MTZehvor on 03 December 2013
toastboy44562 said:
MTZehvor said:
toastboy44562 said:
MTZehvor said:
toastboy44562 said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
Figgycal said:
ps4tw said:
dahuman said:
Innovation doesn't exist without competition.


Thats crap as what actually drives innovation is the customer

Because the consumer has a choice - hence competition.


lol why you acting as if though you need to buy a console. If they dont like it they wont buy it so the customer drives innovation with their wallet. 

Most of the consumers in this market do want to buy a gaming console, however. Without competition, a company can merely re-release the same product with little to no innovation without fear of another company coming in and stealing their sales. Some customers will likely choose to buy no console over an overpriced, non-innovative one, but the big thing that drives economic innovation in any field, not just video games, is competition.

There's an interesting slideshow about the amount of deadweight loss created by monopolistic firms (or really any imperfect competition). The sole firm selling these consoles will be an almost complete price setter. The firms in the market now are certainly not perfect examples of price takers, but they're much more constrained by how much they can charge and how much they have to innovate as opposed to how they would be without competition.


Want, not need, so their want dictates innovation, whereas need would allow companies to exploit a necessity. 

....yyyyeeesssss...

No one here is claiming that the American population will die out or something if there's no video game consoles around. All of this has to do with people's desires.


exactly, we are talking about consoles not healthcare

Right, but the demand curve in reference here isn't one that's completely inelastic. There are some people who will purchase video game consoles above the market price as is, and those are the ones who would be affected.

What he's trying to say is there will be dead weight loss. Less consumer surplus and more producer surplus.

Essentially this, although ps4tw seems to be arguing against the concept of dead weight loss for elastic goods entirely.

PS4 is priced too cheaply right now causing a consumer surplus thus having dead weight loss.

I agree, almost every console at launch is priced too cheaply to avoid all deadweight loss. I was just simply stating that another person seems to be arguing against the concept of deadweight loss to begin with.

I don't think you get what I meant. If sony can sell all PS4 units at 500 dollars for example, and consumers are willing to pay 500 dollars and Sony is meeting demand exactly with supply meets that means there is no dead weight loss. The fact that more people are waiting for ps4 units at 400 dollars means sony is not selling at an effecient price. consumer profit is not being maximized meaning there is dead weight loss on the producer side and a surplus on the consumer side.

Edit: I'm not including revenue from compliments that go with the PS4 though. Because people are spending less on the console, the quantity demanded for subscriptions and games goes up. This makes up for the 100 dollar+ deadweight loss I'm sure.

I'm well aware of what you're talking about(I'm an economics major), and I agree entirely with everything you're saying...it's just I'm not sure why you're bringing it up here, though.



toastboy44562 on 03 December 2013
MTZehvor said:
toastboy44562 said:
MTZehvor said:
toastboy44562 said:
MTZehvor said:
toastboy44562 said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
Figgycal said:
ps4tw said:
dahuman said:
Innovation doesn't exist without competition.


Thats crap as what actually drives innovation is the customer

Because the consumer has a choice - hence competition.


lol why you acting as if though you need to buy a console. If they dont like it they wont buy it so the customer drives innovation with their wallet. 

Most of the consumers in this market do want to buy a gaming console, however. Without competition, a company can merely re-release the same product with little to no innovation without fear of another company coming in and stealing their sales. Some customers will likely choose to buy no console over an overpriced, non-innovative one, but the big thing that drives economic innovation in any field, not just video games, is competition.

There's an interesting slideshow about the amount of deadweight loss created by monopolistic firms (or really any imperfect competition). The sole firm selling these consoles will be an almost complete price setter. The firms in the market now are certainly not perfect examples of price takers, but they're much more constrained by how much they can charge and how much they have to innovate as opposed to how they would be without competition.


Want, not need, so their want dictates innovation, whereas need would allow companies to exploit a necessity. 

....yyyyeeesssss...

No one here is claiming that the American population will die out or something if there's no video game consoles around. All of this has to do with people's desires.


exactly, we are talking about consoles not healthcare

Right, but the demand curve in reference here isn't one that's completely inelastic. There are some people who will purchase video game consoles above the market price as is, and those are the ones who would be affected.

What he's trying to say is there will be dead weight loss. Less consumer surplus and more producer surplus.

Essentially this, although ps4tw seems to be arguing against the concept of dead weight loss for elastic goods entirely.

PS4 is priced too cheaply right now causing a consumer surplus thus having dead weight loss.

I agree, almost every console at launch is priced too cheaply to avoid all deadweight loss. I was just simply stating that another person seems to be arguing against the concept of deadweight loss to begin with.

I don't think you get what I meant. If sony can sell all PS4 units at 500 dollars for example, and consumers are willing to pay 500 dollars and Sony is meeting demand exactly with supply meets that means there is no dead weight loss. The fact that more people are waiting for ps4 units at 400 dollars means sony is not selling at an effecient price. consumer profit is not being maximized meaning there is dead weight loss on the producer side and a surplus on the consumer side.

Edit: I'm not including revenue from compliments that go with the PS4 though. Because people are spending less on the console, the quantity demanded for subscriptions and games goes up. This makes up for the 100 dollar+ deadweight loss I'm sure.

I'm well aware of what you're talking about(I'm an economics major), and I agree entirely with everything you're saying...it's just I'm not sure why you're bringing it up here, though.


Oh my bad I thought i saw something wrong somewhere in that big blob of text mess



ps4tw on 04 December 2013
toastboy44562 said:
MTZehvor said:
toastboy44562 said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
MTZehvor said:
ps4tw said:
Figgycal said:
ps4tw said:
dahuman said:
Innovation doesn't exist without competition.


Thats crap as what actually drives innovation is the customer

Because the consumer has a choice - hence competition.


lol why you acting as if though you need to buy a console. If they dont like it they wont buy it so the customer drives innovation with their wallet. 

Most of the consumers in this market do want to buy a gaming console, however. Without competition, a company can merely re-release the same product with little to no innovation without fear of another company coming in and stealing their sales. Some customers will likely choose to buy no console over an overpriced, non-innovative one, but the big thing that drives economic innovation in any field, not just video games, is competition.

There's an interesting slideshow about the amount of deadweight loss created by monopolistic firms (or really any imperfect competition). The sole firm selling these consoles will be an almost complete price setter. The firms in the market now are certainly not perfect examples of price takers, but they're much more constrained by how much they can charge and how much they have to innovate as opposed to how they would be without competition.


Want, not need, so their want dictates innovation, whereas need would allow companies to exploit a necessity. 

....yyyyeeesssss...

No one here is claiming that the American population will die out or something if there's no video game consoles around. All of this has to do with people's desires.


exactly, we are talking about consoles not healthcare

Right, but the demand curve in reference here isn't one that's completely inelastic. There are some people who will purchase video game consoles above the market price as is, and those are the ones who would be affected.

What he's trying to say is there will be dead weight loss. Less consumer surplus and more producer surplus.

Essentially this, although ps4tw seems to be arguing against the concept of dead weight loss for elastic goods entirely.

PS4 is priced too cheaply right now causing a consumer surplus thus having dead weight loss.

getting the biggest market share is essential now as thats the best advertising. spend money to make money



Marks on 04 December 2013
ps4tw said:
dahuman said:
Innovation doesn't exist without competition.


Thats crap as what actually drives innovation is the customer


"If I had asked people what they wanted, they would have said faster horses" - Henry Ford

Do you really think the customer drives innovation? Ford didn't make the first car, he just made it better and more efficient to manufacture them...nothing happens without competition, greed, and other factors. 

 



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MTZehvor on 04 December 2013
ps4tw said:
getting the biggest market share is essential now as thats the best advertising. spend money to make money

Certainly, taking on deadweight loss is sometimes favorable for a company's prospects. The point here is that said loss is what gives companies room to move if there was no competition. If there was no concern about who had the bigger market share (only one company in the market), then companies wouldn't need to cut prices to get ahead in that department. They could simply charge the market price as set by supply and demand, whereas in a situation that involves competition, they willingly choose to go under.



ps4tw on 05 December 2013
Marks said:
ps4tw said:
dahuman said:
Innovation doesn't exist without competition.


Thats crap as what actually drives innovation is the customer


"If I had asked people what they wanted, they would have said faster horses" - Henry Ford

Do you really think the customer drives innovation? Ford didn't make the first car, he just made it better and more efficient to manufacture them...nothing happens without competition, greed, and other factors. 

 

Not true - look at bread makers. 



telsta on 05 December 2013

Go outside ans take a look around, not coexisting peacefully in console wars is our smallest problem.



MTZehvor on 05 December 2013
telsta said:
Go outside ans take a look around, not coexisting peacefully in console wars is our smallest problem.

...no one's saying it's the biggest problem.