Oligopoly

For a few handful of corporations or companies, they dominate a certain industry and co-exist peacefully. They are existing individually, but act as a same group, because they have the same goal.

Oligopoly is a word that only appears after the Industrial Revolution, only after that corporations start to show up and dominate the daily life. And apparently this word fits into English speaking countries very well.

In a market competition, it’s normal to see in the end of the battle, only a few survivors could claim the throne. The weaker ones are filtered out in the process, or get bought or merged into the existing companies.

Till today, we are already in a stage of a giant corporate web that is delicately woven, sprang from generations ago.

Corporation Map

Oligopoly, a very near example can be taken from video game industry. Till today, the big players are only a handful, and each one of them specialize in specific genres. Ubisoft, EA, Microsoft, Sony, Square Enix, Nintendo, 2K, Activision Blizzard, Take Two. These are the major players in the industry, the industrial standards are decided by these guys, such as your game’s price tag, how much content for a game, ad campaigns etc.

Sony and Microsoft are always rivals on console market, a market that is dominated by the two conglomerates, Nintendo, gets a small percentage from it. The prices of the consoles, PS4, XBox One are not too far from each other. Creating a huge price difference would certainly drives one side’s products a better sale, but it would substantially damage everyone in the game. The result would be either the other two start to drop down their prices, or they together sanction the common enemy.

However, either one is a feasible way for corporations to grow, in business war, to be as stable as possible would be the golden rule. You don’t want instability, instead of grabbing a huge amount of market into your name, you’d rather to set some rules for others to come in, and treat them with good manners and win in the long run. Every side can profit and benefit is the best win-win for business.

And sprang from this, business can take considerably immoral actions to succeed in order to achieve the win-win situation.

Monopoly, on the other hand, would be a far laxer and profitable situation.

As mundane folks, consumers, everyone would want a better price for the products. Competition is always good for consumers.

In a more fierce competition, the winner is the consumer, a more relaxed competition, the winner is the producer.

Leave a Reply

Your email address will not be published. Required fields are marked *