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3 Firms Confess To Fixing LCD Prices, Agree To Pay $585M Fine
Oldyeller89 writes "LG, Sharp, and Chunghwa Picture Tubes pleaded guilty to charges of price fixing in violation of the Sherman Antitrust Act. They fixed the prices on LCD screens used not only in their products but also in other products such as Apple's iPods. The three companies agreed to pay $585 million in fines. Perhaps this will cause the price of our TVs to drop?" The New York Times also has a story on the outcome of this case.
I wonder if the price to produce a plasma television is just inherently much higher than LCD if the already generally lower prices on those were being fixed in many cases.
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$585M in fines... so, how much did they profit before that?
... I'd expect this kind of BS from Sharp and LG but not from Chunghwa Picture Tubes.
"Perhaps this will cause the price of our TVs to drop?"
Um, except that they just added $585,000,000.00 to their cost of production, sure.
G.
So since I paid them more money than I should have, do I get $30x#numberScreensBought out of this $585M fine? Who gets the fine money?
The LCD's in question were not sold directly to consumers, they were in devices like cell phones and ipods. The cost was absorbed by the manufacturers of these devices, and if it drops, good for them... but do you really think they'll pass that directly on to consumers? The illegal markup per unit probably isn't all that big. This will amount to a small increase in the profit margins of the device manufacturers, if it amounts to anything at all.
My grandmother used anecdotal evidence all the time, and she lived to be 120 years old.
And so, now that we have found out they have fixed prices, we can all feel free to sit with thumbs up our asses about the jacked prices we had to pay to feed companies that agree to pay a fine that is higher than the average amount of money 5 families make in a lifetime.
And $50 says the CEO's won't be taking a dip in their salaries to compensate for the fine; nope, chances are they'll lay off some people and give pay cuts out to everyone that just does their job without trying to find a way to make a quick buck.
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I was just about to buy a new monitor for WotLK so I could quest easier (having quest info from wowhead on monitor A while gaming in windowed mode on monitor B).
Now I'm gonna definitely go with Samsung, because they are not involved in this lawsuit and therefore they must be rewarded for not getting caught. Anyone can tell that Samsung also does not pad their contrast ratios like LG obviously does. Who could believe a 10000:1 contrast ratio? That's ridiculous! Samsung has decided to only push their padding to 8000:1 which respectfully identifies with the company's obvious higher level of integrity.
The Samsung even looks nicer!
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The cost was absorbed by the manufacturers of these devices, and if it drops, good for them... but do you really think they'll pass that directly on to consumers?
You really think they were absorbing the cost before? Still, I agree that any price drops will not exactly be through the floor.
Perhaps this will cause the price of our TVs to drop?
Perhaps instead they will factor this cost into their new products in attempt to recoup this lost $$.
So the scenario is: Purchaser is hurt due to collusion and price fixing. Companies are caught. Purchaser is hurt due to fines.
Fines are only a deterrent if they actually hurt the companies bottom lines. If they can make enough profit during the price fixing phase, and jack up enough prices during the penalty phase to more than offset the penalty there will continue to be massive collusion in such systems.
Does this have anything to do with the ridiculous inability of the laptop LCD screen market to put out 1920x1080 screens?
It's as though they're keeping the market for TV screens expensive by not allowing the format to bleed into laptop realm, wherupon cheap computers become high-quality televisions, killing the TV screen market.
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To shop more intelligently.
I *JUST* swapped out my CRT monitor after 8 years of solid, reliable use. I picked up a used LCD screen from my company for dirt cheap. I was never a beta tester for slow response-rate, burned out pixels and shoddy construction LCD screens.
I realize basic economics tells us, that there is a maximum profit point on the two line graph of units sold vs cost per unit, but dare I say they could have actually LOST money by charging too much, and forcing cheaper consumers out of the market.
meh, their loss.
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585M should be enough for anyone
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Normally, in the tech product cycle, as I learned in business school, you'd expect a 40 to 42 inch HDTV set to be running around $399 with rebate down to $350 at this point (1080p), but I'd been puzzled that prices were up to $200 higher than expected.
That explains it.
Mystery solved.
If the price fixing is broken, we should see 40 to 42 inch LCD HDTVs in the 1080p resolution selling for around $300 around Presidents Day 2009.
-- Tigger warning: This post may contain tiggers! --
Another magic trick of modern totalitarianism, passing as democracy through massive propaganda, is that you believe in things that simply don't exist - like the Invisible Hand of Adam Smith's imagining meaning something it does not. Here's the quote:
By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was not part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. It is an affectation, indeed, not very common among merchants, and very few words need be employed in dissuading them from it.
So the invisible hand was Adam Smith's belief that an Englishman would buy English products produced in England, or start a manufacturing company in England for English consumers.
However, this loyalty to one's country simply isn't implicit anymore, if it was, ever. Joseph Stiglitz, Nobel economist, states:
Whenever there are "externalities" - where the actions of an individual have impacts on others for which they do not pay or for which they are not compensated - markets will not work well. Some of the important instances have been long understood - environmental externalities. Markets, by themselves, will produce too much pollution. Markets, by themselves, will also produce too little basic research. (Remember, the government was responsible for financing most of the important scientific breakthroughs, including the internet and the first telegraph line, and most of the advances in bio-tech.)
But recent research has shown that these externalities are pervasive, whenever there is imperfect information or imperfect risk markets - that is always.
So, if you believe in a free market, globalization is very, very bad. GM is not failing because of the UAW (though they have many, many problems due to the UAW). GM is failing because it's being forced to compete with subsidized Japanese auto industry, and not receiving investment because of the inevitability of competing with Chinese automakers, which are a lot cheaper. Why? They can wreck their environment, exploit workers, and make unsafe products because China in many ways has a freer market than the US, if not a freer government. Why people are surprised that competition with third world countries wipes out entire manufacturing industries here at home, I'll never understand.
Repeat after me: I do not want a free market. I want a well regulated and competitive market that gives me the benefits of capitalist elements without wrecking the world in the process. I believe in liberty and equality and raising living standards for Americans, and trading with other nations so that they have the freedom to choose what they want to produce, not the "freedom" to sign up for another round of exploitation by Fortune 500 companies.
Anyway. There's good information on the Invisible Hand at the quite decent Wikipedia article, where I got my quotes from.
What about for gaming though? You're essentially capped at 60fps due to needing Vsync on LCD monitors to avoid massive shearing issues. Whereas a HQ CRT supports 100+hz.
The naked eye may not see more than 60fps, but there are definite fluidity gains still up to the 100-120fps range which LCDs can't match currently.
Does this have anything to do with the ridiculous inability of the laptop LCD screen market to put out 1920x1080 screens?
As far as I can tell, the lack of 1080p-class LCDs in notebook computers has more to do with physical size than anything else. On a reasonably-sized laptop, you'd have to set your laptop on "huge fonts" in order to read text without squinting. Make it any bigger, and it's not a "laptop" as much as an iMac 24" with a fold-out keyboard. (But then I prefer netbooks anyway.)
An LCD screen shows different colors depending upon your view angle. This is not good for graphics professionals.
Or maybe the price will remain the same as they now have reduced revenue and an increased cost per unit of the fine divided over the number of LCDs shipped. And I have bought a bunch of LCDs over the years. Think I will see any benefit? Doubtful! But maybe there will be a slight reduction in cost a while out. Current prices have already significantly dropped since this lawsuit was entered into.
- Tjp
I am in wallow with my inner money grubbing capitalistic pig. ... Oink!