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Google Finance, Govt, Policy and Business Issues Forum

Froogle pulling a Redmond?
Squeezing the competition with predatory pricing

 8:43 pm on Dec 8, 2003 (gmt 0)

Existing shopping engines depend on merchant (advertising) revenue to fund operations and innovation, with froogle muscling in with free feeds to the merchant, do they run into anti-trust provisions?

The Supreme Court has established three criteria for proving an instance of predatory pricing: (1) Prices must be below an appropriate measure of cost, (2) these artificially low prices must be capable of driving rivals from the market, and (3) the perpetrator must have a reasonable prospect of using its monopoly power to recoup its short-term losses.

Sounds like a case.



 9:29 pm on Dec 9, 2003 (gmt 0)

Google isn't a monopoly. They're offering free services, and people are perfectly able to use another service, free or not.


 9:34 pm on Dec 9, 2003 (gmt 0)

As long as it stays free, its okay, just can't use dominant market position to muscle out competitors with predatory pricing.

A violation would occur if the free option disappeared after the competition was damaged.

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