Disney+Fox vs Netflix is a good case study on market power / monopoly / superstar firms. Here’s why:
— Walt Frick (@wfrick) December 14, 2017
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Netflix fits the superstar story nicely. Innovative use of technology + returns to scale = large benefits for customers. What’s not to like?
— Walt Frick (@wfrick) December 14, 2017
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But the rise of superstars makes monopolistic rent-seeking more likely. You have to be big to compete, and the way incumbents grow quickly is M&A which typically doesn’t help consumers.
— Walt Frick (@wfrick) December 14, 2017
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One final reason this case study is illustrative: one of Netflix’s key advantages is tech; Disney’s is IP.
Their competitive advantage rests largely on questionable (at best) extensions of copyright law.— Walt Frick (@wfrick) December 14, 2017
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Add it all up: both the superstar and the rent seeking story fit, and they interact. It’s both at the same time.
— Walt Frick (@wfrick) December 14, 2017
beyond the times 