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0 pointscrazygringo5y ago0 comments

I read his article, and unfortunately his nuance essentially comes down to:

> The loss of an independent Slack is sad, because Slack’s strategy wasn’t just a standard attempt to gain market power. As a company, Slack’s team thought carefully about product design, and that care showed.

That's not an economic argument, it's an aesthetic one.

The fact is, it's natural in many industries to coalesce around 2-3 major competitors. And as we can see, that's exactly what's happening here. Slack isn't being snuffed out. It's living on as part of one of the ~3 major players in the space, which is a natural and desirable outcome for consumers who want simple bundled all-in-one solutions.

And Microsoft hasn't been "losing money" by including chat functionality in Office -- what you're describing is predatory pricing which is simply not the case here. Office is an expensive product that companies pay tons of $$$ for.

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sjy5y ago

How is it “natural” for many industries to coalesce into oligopoly? This requires a legal system with strong property rights for corporations and lax competition law enforcement. These conditions have not always existed. You can argue that the status quo is welfare-optimising, but I don’t see what’s natural about it.

crazygringoOP5y ago

Coalescing into 2-3 major competitors is natural in the sense that consumers can't, and don't want to, keep track of 10 or 20 different choices for the same thing. It's just too much. It's the paradox of choice.

There's nothing inherently wrong with "oligopolies" except when they collude together to raise prices, and competition is weak. But that's obviously not the case in office productivity software -- competition and innovation are intense, and there's zero evidence of price-gouging whatsoever.

lefrenchy5y ago

For a small/medium sized business trying to optimize expenses, Microsoft can gain a competitive edge simply off having teams “bundled” into it’s offering, without actually being a superior product.

If your argument is that there is a tendency towards monopoly and that’s just the way of thing, even in a “free market capitalist” economy which is based largely on the idea of competition, then I don’t find it convincing.

Consumers end up with bundled solutions with 2-3 companies precisely because those companies take steps to make that the outcome (eg Apple making integration sub-par when it is not first party)

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