"Roland Perry" wrote in message
...
In message , at 15:50:48 on Sat, 1 Apr 2017,
tim... remarked:
the one thing about the taxi trade is that they can't monopolies the
market through lower fares and then hike them when the competition pulls
out

the barriers to entry for a taxi company are so low that if you take
your fares back up to the regulated maximum the competition will soon
pile back in again.

to keep the competition out you have to keep your fares low forever

which is fine if your costs of operation really are low enough to
support that, but does mean that operating an unsustainably low fare to
grab market share doesn't work.

Except Uber is trying that.

I know

So your theory crashes in flames.

but as it hasn't got to the "lets put the fares up again" bit, how does,
where we are now prove that it will work?

That's what the investors

Yep, they are taking the risk along with Uber.

That doesn't mean that they are any more correct in a view that it will
succeed.

and the competition regulators do for a living, predicting how it will all
turn out.

They can only take pre-emptive action if considering a takeover in an
industry.

They can only act retrospectively if a monopolistic position obtained from a
commercial advantage has been abused.

They have no mechanism to say to a new entrant - sorry you can't price your
product under costs because it may force a competitor into bankruptcy

tim




--
Roland Perry