Wednesday, June 22, 2005

When will HP, et al, cry "Unfair competition!"

Dell launches sub-$100 laser printer

Dell has unveiled a black-and-white laser printer priced at $99--low enough, possibly, to kick off a price war in the home and small-office printer market.

The computing giant introduced its Dell Laser Printer 1100 on Tuesday. The device handles up to 15 pages a minute with a resolution of 600 dpi. Analysts predict competitors ranging from Hewlett-Packard to Lexmark will feel the pressure to offer something comparable, given that their low-end monochrome lasers start at roughly twice that price.

"Dell's laser is a disruptive price," said Charles Wolf, an analyst with Needham & Co., adding, "This could cause more consumers to shift over to laser."
Not to put words into their mouth, but I'm waiting for Dell's competitors to realize they can't compete, then accuse Dell of "anti-competitive tactics" just because it offers more for less.

Isn't that the New American Way Of Doing Business? If you can't compete, sue; or go the FTC. If Dell gains too much market share (often confused with "market power"), perhaps Compaq-HP and IBM could have the federal government investigate breaking Dell up into smaller, completely separate companies. One would involve Dell's base of desktops and servers, a second would be about monitors and home consumer electronics, and a third would produce printers.

Why is this such a stretch? After all, it's what Microsoft's competitors and the feds tried to do. Basically what they argued is that it's "anti-competitive" to compete.

5 Comments:

Blogger TKC said...

Competition is unfair. Somebody wins. Somebody loses.

That this is somehow a bad thing is a bit of a head scratcher.

Wednesday, June 22, 2005 3:17:00 PM  
Blogger Quincy said...

Laser is just such a superior techonology that this was bound to happen. Once I bough my HP LaserJet three years ago, I realized that I NEVER wanted another inkjet. It's fast (22ppm) and I've only had to change the toner twice since I've owned it.

Thursday, June 23, 2005 2:48:00 AM  
Blogger Perry Eidelbus said...

Over time, certainly, technology will become cheaper and more affordable -- if there's competition to drive prices down. This is what Bastiat's theories of abundance and scarcity are about. But a lot of federal action ostensibly to promote competition in fact hinders it, by punishing those who offer more for less.

This is also an answer to my friend Charlie, who said that Dell's move isn't "anything astounding." Perhaps, perhaps not. Dell is pushing ahead of the pack, and financially, they're doing much better than the competition. So I'm wondering when the FTC will accuse them of being "anti-competitive."

Thursday, June 23, 2005 9:58:00 PM  
Blogger Quincy said...

The whole thought that a company doing something extraordinary like this must be up to something dishonest has always astonished me. It's moves like this that really push innovation, since Dell's competitors have to match pace with cost and quality to keep market share.

Instead of allowing that to happen, the regulatory leviathan enforces an environment where the rule is compete, but not too much.

Friday, June 24, 2005 6:30:00 AM  
Blogger Perry Eidelbus said...

Even Adam Smith had such suspicion about businessmen that he wrote, "People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices." But he wasn't perfect: he also believed in the labor theory of value.

Saturday, June 25, 2005 9:01:00 PM  

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