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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.
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!
The dangers of knowledge trigger emotional distress in human beings.
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.
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.
An LCD screen shows different colors depending upon your view angle. This is not good for graphics professionals.