Um... are you seriously telling me that sysadmins are going to take over the world? Even if we accept for a moment that whites will get all the tecnology and others won't I still don't see how that leads to a medieval society. There are still lots of non-computer-literate jobs out there.
And as a previous poster pointed out, technology starts out with the rich, who pay a premium and fund the initial R & D, and it spreads out as the technology matures. I can now get a telephone, a TV, a stereo, a VCR, and a microwave for a total of about $500. 40 years ago, that would've set you back thousands of dollars.
The same will happen with computers. The iMac and other similar computers are starting to show the trend, as are the "free" and sub-$500 PC's. Computer makers have hit a ceiling on the high-end market, and are now gearing up to get a piece of the 50% of the population that still is without a computer. Within 5 years, I predict that computer ownership will be up to 60 or 70 percent, and you'll be able to get a full-fledged PC from a major name for under $500. At that point it will be less a matter of money and more a matter of willpower: the people who still go without will do so because they are intimidated by the technology.
Five years after that, low-end computers will be down in the $200-$300 range, as PC-on-a-chip technologies make it possible to produce an entire motherboard for under a hundred bucks. Internet access prices for a megabit connection will be available for the same kind of money as phone access. That's within the reach of even the poorest Americans.
So even if there is a disparity now, that disparity will close in the near future. You don't see any hand-wringing about the gap between the rich and the poor in TV ownership, or VCR ownership, or microwave ownership. This is because prices are now so cheap that literally anyone can afford them. The same will be true of computers. Computer makers will continue to find cheaper methods of computer-building, and the result will be a steady increasing in access for all Americans.
This is just what you think. There many examples where you see the opposite. One example is healthcare that in the US costs 11% of BNP and the results (life expectancy) is worse than many european countries which spend 8% of their BNP on healthcare.
That's a very broad statistic, and is all but meaningless without details. Keep in mind that the US has among the best health care systems in the world, so we may pay extra for that. Also, the health care industry isn't really a free market. The government has regulated it so much that it's hard to say what it would be like today if it had been allowed to take its course.
It's better to give 10 Billion to the 10% poorest people on earth than to give Bill Gates an extra 10 Billon. There are a lot of human resources wasted because of poverty.
I see this basically as a moral issue. No matter how much you'd like to give that money to the poor, it's not yours to give. It belongs to Bill, and he has a right to do with it as he pleases.
Now in fact, he can't possibly spend it all, so much of it probably will go to others. But that doesn't justify Robin Hood-style theivery. A good goal does not justify bad means.
In addition, taxing the rich and giving it to the poor hurts the economy in the long run. Economic growth comes from capital aquisition, and wages can only go up if productivity rises. So if we take away everyones' wealth and give it to the poor, there will be less investment, which means slower growth.
I think the optimal society is capitalism moderated by strong giverment.
I would argue that's a contradication in terms. A more accurate word for that system is called "fascism:" a moderately free market with massive doses of government control. The best system is capitalism without adjectives. The government should limit itself to its core function of protecting individuals from aggression, and let the market work its magic. In the long run this benefits everyone, the rich and poor alike.
What can I say? You're hysterical ranting doesn't warrant response. I guess you're so sure you're right, you don't even need to provide anything to prove it. I guess I'm just too caught up in my right-wing fantasies to see the beauty of your left-wind delusions.
I'm appalled by your complete lack of understanding of economic principles:
Any evidence at all for that?
No, but common sense tells you that at least some of those people are. The unemployment rate has never been lower than about 3%, even at the peak of an economic boom. It's possible that that's the evil employers exploiting the workers, but it also might just be that there's always a certain amount of time between jobs, and so there's always a few unemployed folks.
As for other regions of the country, you may be right that I'm lucky to live where I do. I'm not going to argue with that.
The problem is, companies are moving to places that offer cheaper labor. From there, they'll move to places that offer even cheaper labor. Well, if no company is paying their workers enough to buy their own products, how the hell o they plan to actually sell something?
What about that "cheap" labor? Would you rather we kept all the jobs here and let foreign workers be even poorer? Third world countries are willing to work for less because they are poorer than us. By what right do you deny them jobs just because you want to make sure your wages don't go down?
The last sentence above is so wrong I don't even know where to start. This is the whole point of a market. If everyones' income goes down, then product prices go down. Things balance. Are you seriously telling be that the result of capitalism would be that every corporation will have lots of surplus goods and all the workers will have no money, and then everyone will starve? Have you ever opened an economics book? That's absurd.
Petroleum.
As I understand it we've got about 50 years worth left. And as we start to hit that limit, prices will rise and people will switch to alternatives.
Genetic diversity.
Possibly a problem, definitely a crisis
Drinkable water. Arable land. Breathable air.
Not sure i see your point here. I have enough. And it doesn't seem to be going away. Others may not, but that's hardly the evil corporations' fault. If anything, they help that problem by finding new and better ways to filter water, and clean the air.
Furthermore, you've got that in the reverse order. Corps are ruled by 1) a small group of stockholders 2) Management 3) finally, a large number of faceless individual employees. Of whom I am one, so don't even try to tell me I don't know what I'm talking about. I can't even change policy in my own group to any measurable degree. Furthermore, the first two groups are driven almost solely by the stock price of the company, and the first group only by the short-term stock price. If the price starts to go down, they'll just bail out and buy a different company. Which is why the people who make decisions in this country don't give a rat's ass about the long-term view, and why we're going downhill as fast as we are.
Again, you obviously have no clue about economics. No one can be sure when a stock is "about to plummet." Even if they did, why would someone else buy it if they knew it? And if every company is self-destructing, how come their stock prices keep going up?
Hmmm, I guess you don't think 8 million unemployed adults is much? It's convenient they use percentages since it always sounds like so much less than it really is.
Depends what they are doing. I doubt very few of them have been out looking for jobs for months. Many of them have either just lost their jobs, or have decided not to seriously look for a new job for a while. I could be wrong. But I do know that at least in this part of the company jobs are plentiful and they pay much better than the minimum wage. Other parts of the country may be different. I don't know.
Corporations need to keep making profits, and they do this through dropping the cost of their production.
Um, yeah. So? That's the whole point of production: making things for as little effort as possible. Would you rather they try to find the most expensive way to produce things? What would that accomplish?
Now, common sense will tell you these corporations will need people to buy their goods.
And? Common sense tells me that people need to buy those goods. It's called trade. It's good.
Common sense will tell you we are going to run out of natural resources soon.
No it doesn't. We are constantly finding new sources of natural resources. The earth is a very big ball of rock. you can bet there's a lot of useful material in it.
Common sense will tell you are ecosystem is being screwed up.
A little bit. Certainly not as much as greens will have you believe. They were predicting global ecological collapse by the millenium back in the seventies. That hasn't happened, now, has it? I still see flowers and trees and birds outside my window. Doesn't look too bad to me.
The corporations are not human beings, they are faceless profit seeking vultures.
No, they are human beings. They're employees, managers, and stockholders. And yes they're profit-seeking. That's a good thing. Greed is what made this country great. You know why I get up and go to work in the morning? Greed. I like to eat. I like to buy myself new toys. I like to have a place to live. I'm greedy.
Someone who was completely ungreedy would starve to death in the streets. Greed is what makes the economy go. It's what drives people to create, to produce, to learn and grow. Without it, we'd still all be in our caves.
Another thing, what do you think about corporate welfare?
I think it's disgusting. You're the second person who's brought that up. What is up with that? Are you so accepting of government largess that you assume that anyone is against handouts to the poor must like handouts for the rich? I don't think anyone should get taxpayer-financed handouts.
Why do all right-wing capitalists sound like brainwashed cult members?
Um, read your own post. Corporations are not evil. They are not the great satan. They are not out to get you. They are an important part of the modern economy, and they help us produce the great wealth we now enjoy. They are mad up of individuals like you and me, trying to make a profit like you and me. That's life. It's a good thing. Get over it.
If you think that almost everyone earns more than the minimum wage (or even the minimum wage) then either you live in a different city than I currently do
This is probably the case. I live in Minnesota, and I see signs at the local fast food joints about starting wages averaging $7 an hour. Anyone with even minimal skills can work at a fast food place. Certainly some people have such minimal skills that they make less than $6/hour, but not many, and not for long if they work at improving those skills. It might be different in other states, but that's how it is here.
Before the factories came in there was almost no unemployment.
And a lousy standard of living. The reason that there was no unemployment was that everyone lived on a farm, and had to put in 60 hour weeks just to grow enough food to support their families. If you went out back and milked the cows, that made you "employed." I'd say the factories were a big improvement.
When computers came in, the skills needed started shifting quickly, and many skilled people suddenly (well, over a period of about 10 years) became unskilled.
Some people did, some didn't. Certainly some people have had to learn new skills, but I don't think it is nearly as difficult as you seem to think. And even a relatively unskilled person can survive at one of the large number of relatively low-skilled jobs paying $7-$9 an hour. No it's not fun, but it's a start.
The obvious way out is to institute on-the-job training, but without generous tax credits this won't happen...
Are you saying that most people are so poor that they can't afford to get training without help? I find this hard to believe. Yes, college is expensive, but there are lots of community collges, techncal schools, self-help books, and many employers *do* provide training, even to their unskilled workers. I question your doom-and-gloom outlook. The sky is not falling.
And stock speculators cause the companies to focus on quarter-to-quarter profits, with the strong desire that each quarter be higher than the last.
If this is true, then these speculators will drive the company into the ground, they will lose their money, and wiser speculators will be around next time. The stock market has some of the brightest people in the country. Do you seriously think that they are all so stupid as to focus only on the next quarter and ignore the long-term damage they are doing? Most of them are going to keep the stock for more than a few weeks, and even if not, they still are going to have to find someone to buy the now-crippled company.
So no, capitalism is not inherently unstable, people are not helpless, managers are not stupid, and the poor are not doomed to remain that way forever. I guess I'm a lot more optimistic than you.
Yeah, right. So why are all these 30-40 year old geeks with impressive resume's getting ditched for 20 year olds, and settling for cruddy little jobs instead?
Some do, some don't. What's your point? If the 30 and 40 year olds let their skills stagnate, are you saying the corporation has an obligation to keep giving them raises and promotions just for existing? The older geeks have things the younger geeks don't: more industry experience, better judgement, a wider perspective on new technologies. Younger geeks have different advantages, but in either case, the corporation pays people what their skill command on the market. If the young geek makes the company more money, then they should be paid more, no?
If humanity were all alike, and all equally good at a job, everybody would be getting the minimum wage (and we'd probably have been hived by now)
I suggest you study economics. You just got done saying that companies bid up the prices of the higher-skilled workers. Why wouldn't the same process happen for the lower-skilled ones? The fact is, that's what happens. If an employee is making a lot more for his company than he is being paid, a competing company will offer him more to come work for them. This applies to burger flippers as well as CEO's. If the going rate for burger flippers was $1, restaurants would find they could attract the best people by offering $1.50. Then the compeition would see they are losing workers and offer $2. This will go on until the per-hour profit due to one worker is approximately equal to that worker's pay.
I assume you have at least some knowledge of economics, so I find it strange that you'd take this position. No one argues that this occurs in any other market. Every market has a system of supply and demand, and the market price is determined by these forces. This is a simplification in some cases, but it does decribe approximately how things work. Thus a free market in labor would not lead to the price of labor dropping to zero and more than the price of soybeans would drop to zero. Companies compete for employees just as they compete for raw materials. And no one pretends that raw materials will be "exploited" without minimum prices for those. The same economic laws apply.
Can you think of a better Feudal architecture than the modern Corporation? And how much is the difference betweent the actual value of your work, and what you get paid?
That's just nonsense. Today's "serfs" make enourmously more money than any feudal serf, have much better working conditions, and a whole lot more freedom. Anyone in America is free to leave his job and seek another. There's nothing feudal about it.
As for the "actual value of my work," how can I determine that besides looking at how much other people are willing to pay for it? If no one will pay me more than $2 an hour, then on what basis do you claim that it is worth more? Labor does not have intrinsic value. It is only given value by those who value it. If I choose to sell my labor, that means I value the money more than my labor. And whoever buys it values my labor more than the money. There is no such thing as an "actual value," independent of who is recieving the benefits of that labor.
Do you feel that only the corporations deserve government subsidy?
I don't think anyone deserves subsidies. I'd cut back corporate welfare just as quickly as social welfare. I find it interesting that everyone assumes that if you are against government subsidies for the poor, then you must be in favor of government subsidies for the rich. That's nonsense. I don't think the government should subsidize anyone.
So long as you live in a Capitalist society, private industry has no incentive to eliminate unemployment, as unemployment is used as a threat to keep workers in line.
Um... "private industry" is not a single monolithic organization. Individual companies will hire qualified workers and pay them enough to hold on to them. Different companies compete to hold those workers, and offer to pay them more to attract them. So you're just wrong: private industry does not cause unemployment. In fact, right now, the unemployment rate is practically zero. The 5% who are not working are mostly between jobs or are seasonal workers. Anyone with any skills at all has no trouble finding a job.
What causes the unemployment is primarily the government. Things like minimum wages, Welfare, labor regulations, etc. Without these, the markmet would adjust so that pretty much anyone could get a job and support himself. If you don't believe me, ask yourself why almost everyone gets payed more than the minimum wage? Has the "downward spiral" not completed yet? Wages are currently increasing.
So I think you're just confused. Without capitalism, we would all be back to the middle ages, working at manual labor tasks and giving our meager surpluses to our fuedal lords. Capitalism has liberated the common man.
I don't have statistics, although the 2-3 trillion sounds about right. However, I do think we'd be a lot better without welfare.
Think about it this way: Welfare is a subsidy on being unemployed. Simple economics tells you that this will increase the number people unemployed. This is why the Welfare rolls have been steadily expanding, and why poverty has not been eradicated by the Welfare stat, but has expanded.
There are other problems too. Obviously, the money is one problem. Governments in general spend about twice as much to do the same job as the private sector does. The welfare program is riddled with waste and corruption. Also, a private charity organization would have much more incentive to get people off of the dole and onto jobs. So in fact the cost would be a lot less than half what the government spends.
The basic problem is that charity has come to be seen as an entitlement of the poor rather than a gift from those who pay for it. People who felt that they are simply demanding their rights are much less likely to do anything to get a job. There should be a social stigma about living at the expense of others.
So yes, people do lose their jobs and need help, but the private sector does a much better job in that roll. Government welfare has perverted charity into a tax-financed industry.
I know this is an unorthodox position, but ack yourself this: the government in the 60's initiated a "War on Poverty" with the stated goal of eradicating poverty. Today we have more poverty then ever, despite rapidly growing wealth. Clearly something is not working. Government welfare is part of the problem, not the solution.
the mac crowd is generally much less technical than the pc crowd. (This would mean that there would be fewer experienced programmers that would be willing to devote their spare time to working on it).
I don't think this is true at all. Certainly in absolute numbers there are going to be more PC hackers than Mac hackers, just cause there are more PC's out there. But there is a thriving Mac hacker community. Many of the users now flooding into the Mac commnunity as a result of the iMac are probably not hackers, but there is a core of Apple loyalists that have been buying Mac's for 10 years. Many of them are very technically minded. Myself included. MacOSrumors, MacInTouch, MacNN, AppleInsider, MacOpinion are all Mac news sites aimed at power users. There may not be as many of us, but we do exist.
And trust me: you, me, everybody would buy cheaper Intel versions of MacOS if they could. If some company ported a 99% compatible MacOS to Intel and undersold Apple by $1000, Apple would be out of business. Unfortunate, but true.
I wouldn't. At least not under any reasonable scenario. Apple's high end is now around $2500, so I'd be very impressed if someone could come up with the performance-equivalent of the G3/450 for $1500. Apple's pricing, though still a little higher, has gotten a lot better in recent years. The G3 kicks ass, and the G4's gonna be even better. Apple's claims of twice the MHz-for-MHz speed are probably exagerated, but a G3/450 is still a wicked fast machine. And with the upcoming copper and SOI technologies, the PPC will be faster, smaller, and cooler than x86 chips for a while yet.
And one of the biggest advantages of having a Mac is the complete system integration: the OS and hardware were made by the same company, and the two pieces were designed to complement each other. This means that you have much less trouble with driver conflicts, configuration, etc.
A Wintel port of Mac OS would also likely be behind the current Mac OS feature-wise, and it's not going to be binary-compatible. These two combined mean that even if there was a 100%-companitble Mac OS port, most newbies will just buy from Apple and save the hassle. And Apple's core graphics market will likely stick with Apple, as Apple's hardware is very strong in that area.
What Apple should probably do is Open Source 90% of the OS, and keep the remaining 10% proprietary. This is enough to give their hardware a significant advantage, while still reaping much of the benefit of the Open Source model. Or maybe they should just delay releasing the source for 6 months or so. That way the really cool stuff would still make them money, but users would still be able to hack the rest.
That, my poor anonymous coward, is where you are wrong. You can call it what you like, but the system I'm advocating is properly called capitalism. The only way to achieve a long-term monopoly is with government help. In a truly free market, someone will always be waiting in the wings for the opportunity to take your monopoly away from you. So even if you get a monopoly (which is extremely difficult) you can't afford to abuse it too much because you'll end up losing it.
The goal is no longer 'how can I enhance services to win more business from these people?', instead it becomes 'how can I slash their tires more cheaply than I could win business, thereby getting their business by default?'. If this tireslashing requires temporary inconvenience, well, one just has to take the long view, doesn't one?
You are confusing capitalism with gang warfare. If a business is slashing another business's tires, they should be thrown in jail. Slashing tires is completely different from lowering prices. "Unregulated" means that the government doesn't interfere with peaceful, non-coersive activities, not that you should be allowed to do whatever you please.
AMD is getting mugged already. They're losing a lot of money, and the amount of energy and virtuosity they've shown suggests that in a balanced market with many vendors, they would be pushing 50% maybe- they can do inexpensive, they can do a pretty decent yield, they can even do high performance, they can do PR, they can get vendors: what's not to like?
I am not aware of a single example in which Intel slashed AMD's tires or murdered their salesmen. If so, then I fully support arresting those involved.
Instead, they're being mugged- they are slammed into horrible losses not by virtue of them sucking that badly, but simply because they are up against a quiet monopolist.
What exactly is Intel doing that is so horrible? They certainly have not been mugged in any literal sense. You are confusing real warfare with "economic warfare." The first is and should be illegal. "Economic warfare" is a misnomer and should be legal. AMD has a good shot at unseating Intel, and there's nothing unfair about it. They knew the risks and challenges when they went into business, and they clearly think they can win. I think they might to.
For what they're doing, normally one would expect the company to make even a small amount of profit. I'm not convinced they can, whatever they do.
How do you figure? If the K7 is as good as AMD says it is, they stand to make a ton of money, even if Intel does slash their prices. If Intel's product really is inferior, then that means AMD can charge slightly more than Intel, and can thereby outlast them. And as I've said elsewhere, if they do have a superior product, then they will have no trouble getting the investor backing they'll need to stay in business.
And you're fool enough to call that capitalism rather than the feudalism it is- which is why you're a damned fool.
I'm glad you're not an AC, and you make some good points, but you didn't really address the specific reasons I gave. AMD is not a helpless victim on the verge of bankruptcy. The free market it not gang warfare, and it's not feudalism. You paint with an awefully broad brush. Slashing tires and lowering prices are completely different actions, and conflating the two only clouds the issue.
Wow, a non-anonymous, non-insulting, and interesting response.:)
Short-term, this will probably be true. However, investors/banks/whoever are not going to keep throwing money at a company indefinitely. If the company who is selling low has more cash, eventually they will force the other out of business.
But at some point, it starts to hurt Intel so much that even if they do drive AMD out of business, they won't be able to recoup their losses. If Intel attempts to charge monopoly rents, someone else will quickly see an opportunity and enter the market. There are a lot of chip makers who would love to get a piece of Intel's market. So At some point, it just does so much damage to Intel that they are better off just letting AMD have a piece of the market, and working to undercut them by developing better products.
Brian Larsen also made a couple of good points. In particular, if AMD is the underdog, they will be selling fewer total chips, and so they will experience fewer losses from the underselling. And they can temporarily shift their efforts to a different market until Intel raises it prices again.
The point is that the market is never as simple or static as the "predatory pricing" argument assumes it to be. Markets change, companies change. And it is next to impossible for a company to gain and keep a monopoly simply by bullying its competition out of the market.
I can't cite specific examples, but I think the empirical evidence bears this out. Most of the "dumping" complaints are basically just companies whining about getting trounced by a better competitor.
Short-term, this will probably be true. However, investors/banks/whoever are not going to keep throwing money at a company indefinitely. If the company who is selling low has more cash, eventually they will force the other out of business.
But at some point, it starts to hurt Intel so much that even if they do drive AMD out of business, they won't be able to recoup their losses. If Intel attempts to charge monopoly rents, someone else will quickly see an opportunity and enter the market. There are a lot of chip makers who would love to get a piece of Intel's market. So At some point, it just does so much damage to Intel that they are better off just letting AMD have a piece of the market, and working to undercut them by developing better products.
Brian Larsen also made a couple of good points. In particular, if AMD is the underdog, they will be selling fewer total chips, and so they will experience fewer losses from the underselling. And they can temporarily shift their efforts to a different market until Intel raises it prices again.
The point is that the market is never as simple or static as the "predatory pricing" argument assumes it to be. Markets change, companies change. And it is next to impossible for a company to gain and keep a monopoly simply by bullying its competition out of the market.
I can't cite specific examples, but I think the empirical evidence bears this out. Most of the "dumping" complaints are basically just companies whining about getting trounced by a better competitor.
Have you ever heard of Mr Andreas, and a little company called Archer Daniels Midland? (ADM - Supermarket to the world!) Lisene price fixing? 2 years jail time? Hmmmmm?
No I don't. Please elaborate.
But I will point out that ADM is hardly a creature of the free market. They make their money feeding at the government trough--recieving massive Corporate Welfare. So I doubt that it's a good example in any event.
do yourself a favor.. read a newspaper. It talks about the real world.
I love ad-hominum attacks and condescending attitudes. Especially when the person dishing them up won't even put his name behind them.
In fact that's the exact opposite of the truth. When's the last time you saw a Microsoft employee bursting into your home to inspect for Macs? Companies don't have "might." Governments do. That's why advocates of capitalism are so much more afraid of government than corporations. Corporations don't throw you in jail if you displease them.
The weak deserve no pity
That's not what I said. If AMD were to go out of business, I might pity them. I just don't think that we should prop them up if they are producing inferior products at higher prices. Besides, it's not like a company that goes out of business has all its employees taken out and shot. They find other jobs, and are not particularly hurt for it.
It is interesting to me that you choose to make AMD an object of pity. They may not be Intel, but they are far from a poor helpless mom-and-pop corporation.
All people must believe that no business ever suceeds without marketing a superior product. (*cough* Windows *cough*)
Windows sucks. I use it as little as possible, and I have never claimed that it is a good OS. But the fact is that people chose to buy it, because they believed it was the best value. Are you going to tell me that with your superior wisdom, you're going to determine the One True OS, and force everyone else to use it? Consumers have always had choices, and always will. If they make bad decisions, that's their choice.
Any individuals commenting on this are irrational, communist, anti-capitalist, and threats to the American Way of Life.
Given you out-of-context bromides and complete lack of content, I'd say the irrational part of it fits you pretty well. I have no idea if you are communist. You are clearly anti-capitalist. I'm not going to pretend that I have a monoply on the "American Way of Life."
not only does it keep the peons in line but it lets you feel that your superiority made you divinely ordained to lead.
Actually, this is a pretty good discription of statism. I don't know about you, but I don't consider myself a peon, nor a slave to my capitalist masters.
I'm surprised you've avoided noticing how our society works after living in it so long. (I assume you have ? )
I've noticed that the US is both the freest and the most prosperous nation in the world, and I don't think that's a coincidence. I've also noticed that the private sector is in general much more efficient, innovative, and humane that paper-puching bureaucrats and self-serving lawyers. Actually, I'm not even sure what you are talking about. Would you like to explain "how our society works?"
now AMD dosent have any cash to ride out a rough year.
Let's say a year from now AMD is about to release the K8, which is fast enough to blow Intel out of the water, but they're on the verge of bankruptcy. Do you seriously think they would have any trouble getting the capital they need to stay in business? They can go to any investor on Wall Street and say "how would you like to get in on the ground floor of the soon-to-be industry leader in the processor market." Lots of invstors will be willing to take that gamble. If they have a better product, then Intel will have to work hard to compete. If the K7 ends up being a flop, then I'm not gonna shed too many tears if they go under. But in any event, simply cutting prices and hoping AMD goes under isn't gonna cut it.
Also, keep in mind that AMD is not Intel's only competitor. There are lots of other chip makers. none of them make a competitive x86 clone right now, but if AMD stumbles you can bet somebody else will want to take a shot at it. Nothing Intel could do would give them a monopoly for more than a year or two. Then someone will see the opportunity to make a profit and will enter the market. If AMD ever does beat Intel, they will reap substantial profits from being the industry leader. So you can bet they're willing to take some heavy losses on the gamble that they can come out on top.
Boy, that's a helpful comment, especially coming from a coward. I reread my post, and I see nothing unethical about the things I wrote. If this was a serious comment and not simply a random flame, I'd be interested to see you back that claim up.
I don't think there is anything unethical about capitalism, competition, freedom, or low prices. Nor is there anything unethical about one company trying to increase its market share, even if that means that another company loses market share. What is unethical is punishing companies for lowering prices and providing services that people want. It is also unethical to harass productive businesses with nonsensical complaints about their "predatory" practices.
If you have an actual argument to make, let's hear it. But if you simply have a knee-jerk reaction against capitalism, then please don't waste your time. And while you're at it, get yourself a username and take responsibility for the things you post.
Intel knows AMD will run out of money first (like MS and Netscape).
Maybe that was Microsoft's plan, but it obviously never happened. Netscape is still developing its browser and giving it away, and they have used that to leverage their entry into the server market. What's so terrible about Microsoft and Netscape giving their browsers away is beyond me. Netscape recently got sold off to AOL/Sun for an ungodly amount of money. Doesn't look like Netscape ever ran out of money to me.
The same is true of AMD and Intel. The chances of Intel driving AMD out of business in the next few years is pretty much zero. Even if the K7 is a flop and they lose a lot of money on it, they still have a large enough market share to make a K8 and a K9. Intel would be pretty stupid to try a "predatory" pricing strategy for the 5-or-so years it would probably take to drive out AMD, since they'd lose a bunch of money in the process. And once they get their little monopoly and raise their prices, someone else will do the same thing AMD did and create another competing chip. There's just too much profit potential for anyone who can get a piece of Intel's market share for Intel to be able to keep a monopoly for long.
No I didn't miss the point totally. I addressed it head on. Did you even read my post? I said...
The point is that it is not usually possible to waltz into a market with a bunch of money, drive out the competition, and then recoup those losses in monopoly rents. If they don't have a product as good as the smaller businesses, those businesses will be able to survive.
I am not missing the point. I fully understand the point and I think that point is nonsense. There is nothing fundamentally different between "predatory" price cuts and other price cuts. A business with a superior product has a good chance of surviving in the market no matter how much money the competition has to burn. The only way to drive someone out of business and make a profit at it is to make a better product, or find a way to produce it at lower cost. Capital markets provide mechanisms whereby smaller companies can get the operating capital they need to stay in business until the larger company gives up and goes away.
"Dumping" is the exact same idea as predatory pricing, and it has precisely the same economic flaws. The free market has a number of mechanisms that ensure that this type of behavior can be combatted. And in the process of combatting this imaginary evil, laws against "dumping" force consumers to pay more than they otherwise would.
I think it's great that Intel is cutting its prices, and I hope AMD does the same. A "price war" would be a boon to consumers, who would save money whoever they buy from. We should be encouraging price cuts, not whining about them.
These low prices may not even bring Burger Heaven a profit, but they serve the purpose of squashing the weak competition.
It's called competition. Companies compete to have the best product at the lowest price. Whoever does the best job gets a larger market share. That's just the way the free market works.
I don't know anywhere in the constitution where is it says that "mom and pop" stores have an absolute right to keep their market share. If Burger Heaven can produce a better product at a lower price, why should the government stop them?
Now it may be that Burger Heaven is actually trying to drive the mom-and-pop place out of business, but there are lots of ways to combat that. They can borrow money, sell shares in the business to friends, sell their store to McBurgers, Merge with McBurgers, shift to a different market, etc. Remember also that most of the customers in the area probably prefer their superior survice and hometown feel, and will stick with them even if the prices are a little higher.
The point is that it is not usually possible to waltz into a market with a bunch of money, drive out the competition, and then recoup those losses in monopoly rents. If they don't have a product as good as the smaller businesses, those businesses will be able to survive.
It is particularly ludicrous to argue that Intel is going to drive AMD out of business by cutting their chip prices if AMD has a superior product. AMD now has substantial industry credibility, and if it needed more capital, it could sell bonds or float more stock without more trouble. Lot's of investors will be happy to put up the money, in the hope that AMD will be the next Intel.
I get tired of seeing every move by Intel or Microsoft interpreted as further proof that they are evil, while AMD, Apple, Netscape, Motorolla can do the exact same things and no one cares. All companies cut their prices when competitors come out with a better product. That's life. Get over it.
I hate to add myself to the list of people who complain about grammar and spelling errors, but this really bothered me:
Interesting its a really excellent piece.
There should be a comma, period, semicolon--something--after "interesting." The "interesting" is a seperate thought, short for "that is interesting." I had to re-read that 3 times before I figured out what it was saying.
I don't want to nitpick, and it's really not that big a deal. But the little lead-in blurbs Rob writes are only a few sentences each. And thousands of us read them. Surely he can take the time to reread them a couple of times to make sure they are correct. Maybe he can even have someone else read them over. This would save those of us who are anal-retentive a lot of frustration.
The windows system, like the Mac system, is horrible. Having a seperate directory structure for programs and data is the way to go.
One important distinction: what you are saying is certainly true of a multi-user, shared system like Unix or Win NT. However, for Win95 or the Mac, where there's usually only one user, it is a different story. On my Mac, for example, I set everything up, so I know exactly where things are. It would be silly to give myself a "home directory," since there's only one user.
And I would argue that the Mac is usually set up better then the Windows equivalent. The Mac has one "System Folder" and as long as you don't mess with it, your system won't break. Likewise, there is usually an Applications folder, into which applications go, and documents are no normally stored there.
Of course this requires some discipline on the user's part. The best laid out FS in the world is going to break if the user doesn't take the effort to keep in order. But for a single-user machine, I'm not sure there's anything particularly wrong with the Win/Mac filesystem layout. The Mac in particular has a very well-designed set of conventions, IMHO.
Of course, it's lousy for multi-user environments, but that's what OS X is for.
Slashdot Mirror
Um... are you seriously telling me that sysadmins are going to take over the world? Even if we accept for a moment that whites will get all the tecnology and others won't I still don't see how that leads to a medieval society. There are still lots of non-computer-literate jobs out there.
And as a previous poster pointed out, technology starts out with the rich, who pay a premium and fund the initial R & D, and it spreads out as the technology matures. I can now get a telephone, a TV, a stereo, a VCR, and a microwave for a total of about $500. 40 years ago, that would've set you back thousands of dollars.
The same will happen with computers. The iMac and other similar computers are starting to show the trend, as are the "free" and sub-$500 PC's. Computer makers have hit a ceiling on the high-end market, and are now gearing up to get a piece of the 50% of the population that still is without a computer. Within 5 years, I predict that computer ownership will be up to 60 or 70 percent, and you'll be able to get a full-fledged PC from a major name for under $500. At that point it will be less a matter of money and more a matter of willpower: the people who still go without will do so because they are intimidated by the technology.
Five years after that, low-end computers will be down in the $200-$300 range, as PC-on-a-chip technologies make it possible to produce an entire motherboard for under a hundred bucks. Internet access prices for a megabit connection will be available for the same kind of money as phone access. That's within the reach of even the poorest Americans.
So even if there is a disparity now, that disparity will close in the near future. You don't see any hand-wringing about the gap between the rich and the poor in TV ownership, or VCR ownership, or microwave ownership. This is because prices are now so cheap that literally anyone can afford them. The same will be true of computers. Computer makers will continue to find cheaper methods of computer-building, and the result will be a steady increasing in access for all Americans.
This is just what you think. There many examples where you see the opposite. One example is healthcare that in the US costs 11% of BNP and the results (life expectancy) is worse than many european countries which spend 8% of their BNP on healthcare.
That's a very broad statistic, and is all but meaningless without details. Keep in mind that the US has among the best health care systems in the world, so we may pay extra for that. Also, the health care industry isn't really a free market. The government has regulated it so much that it's hard to say what it would be like today if it had been allowed to take its course.
It's better to give 10 Billion to the 10% poorest people on earth than to give Bill Gates an extra 10 Billon. There are a lot of human resources wasted because of poverty.
I see this basically as a moral issue. No matter how much you'd like to give that money to the poor, it's not yours to give. It belongs to Bill, and he has a right to do with it as he pleases.
Now in fact, he can't possibly spend it all, so much of it probably will go to others. But that doesn't justify Robin Hood-style theivery. A good goal does not justify bad means.
In addition, taxing the rich and giving it to the poor hurts the economy in the long run. Economic growth comes from capital aquisition, and wages can only go up if productivity rises. So if we take away everyones' wealth and give it to the poor, there will be less investment, which means slower growth.
I think the optimal society is capitalism moderated by strong giverment.
I would argue that's a contradication in terms. A more accurate word for that system is called "fascism:" a moderately free market with massive doses of government control. The best system is capitalism without adjectives. The government should limit itself to its core function of protecting individuals from aggression, and let the market work its magic. In the long run this benefits everyone, the rich and poor alike.
What can I say? You're hysterical ranting doesn't warrant response. I guess you're so sure you're right, you don't even need to provide anything to prove it. I guess I'm just too caught up in my right-wing fantasies to see the beauty of your left-wind delusions.
I'm appalled by your complete lack of understanding of economic principles:
Any evidence at all for that?
No, but common sense tells you that at least some of those people are. The unemployment rate has never been lower than about 3%, even at the peak of an economic boom. It's possible that that's the evil employers exploiting the workers, but it also might just be that there's always a certain amount of time between jobs, and so there's always a few unemployed folks.
As for other regions of the country, you may be right that I'm lucky to live where I do. I'm not going to argue with that.
The problem is, companies are moving to places that offer cheaper labor. From there, they'll move to places that offer even cheaper labor. Well, if no company is paying their workers enough to buy their own products, how the hell o they plan to actually sell something?
What about that "cheap" labor? Would you rather we kept all the jobs here and let foreign workers be even poorer? Third world countries are willing to work for less because they are poorer than us. By what right do you deny them jobs just because you want to make sure your wages don't go down?
The last sentence above is so wrong I don't even know where to start. This is the whole point of a market. If everyones' income goes down, then product prices go down. Things balance. Are you seriously telling be that the result of capitalism would be that every corporation will have lots of surplus goods and all the workers will have no money, and then everyone will starve? Have you ever opened an economics book? That's absurd.
Petroleum.
As I understand it we've got about 50 years worth left. And as we start to hit that limit, prices will rise and people will switch to alternatives.
Genetic diversity.
Possibly a problem, definitely a crisis
Drinkable water. Arable land. Breathable air.
Not sure i see your point here. I have enough. And it doesn't seem to be going away. Others may not, but that's hardly the evil corporations' fault. If anything, they help that problem by finding new and better ways to filter water, and clean the air.
Furthermore, you've got that in the reverse order. Corps are ruled by 1) a small group of stockholders 2) Management 3) finally, a large number of faceless individual employees. Of whom I am one, so don't even try to tell me I don't know what I'm talking about. I can't even change policy in my own group to any measurable degree. Furthermore, the first two groups are driven almost solely by the stock price of the company, and the first group only by the short-term stock price. If the price starts to go down, they'll just bail out and buy a different company. Which is why the people who make decisions in this country don't give a rat's ass about the long-term view, and why we're going downhill as fast as we are.
Again, you obviously have no clue about economics. No one can be sure when a stock is "about to plummet." Even if they did, why would someone else buy it if they knew it? And if every company is self-destructing, how come their stock prices keep going up?
Hmmm, I guess you don't think 8 million unemployed adults is much? It's convenient they use percentages since it always sounds like so much less than it really is.
Depends what they are doing. I doubt very few of them have been out looking for jobs for months. Many of them have either just lost their jobs, or have decided not to seriously look for a new job for a while. I could be wrong. But I do know that at least in this part of the company jobs are plentiful and they pay much better than the minimum wage. Other parts of the country may be different. I don't know.
Corporations need to keep making profits, and they do this through dropping the cost of their production.
Um, yeah. So? That's the whole point of production: making things for as little effort as possible. Would you rather they try to find the most expensive way to produce things? What would that accomplish?
Now, common sense will tell you these corporations will need people to buy their goods.
And? Common sense tells me that people need to buy those goods. It's called trade. It's good.
Common sense will tell you we are going to run out of natural resources soon.
No it doesn't. We are constantly finding new sources of natural resources. The earth is a very big ball of rock. you can bet there's a lot of useful material in it.
Common sense will tell you are ecosystem is being screwed up.
A little bit. Certainly not as much as greens will have you believe. They were predicting global ecological collapse by the millenium back in the seventies. That hasn't happened, now, has it? I still see flowers and trees and birds outside my window. Doesn't look too bad to me.
The corporations are not human beings, they are faceless profit seeking vultures.
No, they are human beings. They're employees, managers, and stockholders. And yes they're profit-seeking. That's a good thing. Greed is what made this country great. You know why I get up and go to work in the morning? Greed. I like to eat. I like to buy myself new toys. I like to have a place to live. I'm greedy.
Someone who was completely ungreedy would starve to death in the streets. Greed is what makes the economy go. It's what drives people to create, to produce, to learn and grow. Without it, we'd still all be in our caves.
Another thing, what do you think about corporate welfare?
I think it's disgusting. You're the second person who's brought that up. What is up with that? Are you so accepting of government largess that you assume that anyone is against handouts to the poor must like handouts for the rich? I don't think anyone should get taxpayer-financed handouts.
Why do all right-wing capitalists sound like brainwashed cult members?
Um, read your own post. Corporations are not evil. They are not the great satan. They are not out to get you. They are an important part of the modern economy, and they help us produce the great wealth we now enjoy. They are mad up of individuals like you and me, trying to make a profit like you and me. That's life. It's a good thing. Get over it.
If you think that almost everyone earns more than the minimum wage (or even the minimum wage) then either you live in a different city than I currently do
This is probably the case. I live in Minnesota, and I see signs at the local fast food joints about starting wages averaging $7 an hour. Anyone with even minimal skills can work at a fast food place. Certainly some people have such minimal skills that they make less than $6/hour, but not many, and not for long if they work at improving those skills. It might be different in other states, but that's how it is here.
Before the factories came in there was almost no unemployment.
And a lousy standard of living. The reason that there was no unemployment was that everyone lived on a farm, and had to put in 60 hour weeks just to grow enough food to support their families. If you went out back and milked the cows, that made you "employed." I'd say the factories were a big improvement.
When computers came in, the skills needed started shifting quickly, and many skilled people suddenly (well, over a period of about 10 years) became unskilled.
Some people did, some didn't. Certainly some people have had to learn new skills, but I don't think it is nearly as difficult as you seem to think. And even a relatively unskilled person can survive at one of the large number of relatively low-skilled jobs paying $7-$9 an hour. No it's not fun, but it's a start.
The obvious way out is to institute on-the-job training, but without generous tax credits this won't happen...
Are you saying that most people are so poor that they can't afford to get training without help? I find this hard to believe. Yes, college is expensive, but there are lots of community collges, techncal schools, self-help books, and many employers *do* provide training, even to their unskilled workers. I question your doom-and-gloom outlook. The sky is not falling.
And stock speculators cause the companies to focus on quarter-to-quarter profits, with the strong desire that each quarter be higher than the last.
If this is true, then these speculators will drive the company into the ground, they will lose their money, and wiser speculators will be around next time. The stock market has some of the brightest people in the country. Do you seriously think that they are all so stupid as to focus only on the next quarter and ignore the long-term damage they are doing? Most of them are going to keep the stock for more than a few weeks, and even if not, they still are going to have to find someone to buy the now-crippled company.
So no, capitalism is not inherently unstable, people are not helpless, managers are not stupid, and the poor are not doomed to remain that way forever. I guess I'm a lot more optimistic than you.
Yeah, right. So why are all these 30-40 year old geeks with impressive resume's getting ditched for 20 year olds, and settling for cruddy little jobs instead?
Some do, some don't. What's your point? If the 30 and 40 year olds let their skills stagnate, are you saying the corporation has an obligation to keep giving them raises and promotions just for existing? The older geeks have things the younger geeks don't: more industry experience, better judgement, a wider perspective on new technologies. Younger geeks have different advantages, but in either case, the corporation pays people what their skill command on the market. If the young geek makes the company more money, then they should be paid more, no?
If humanity were all alike, and all equally good at a job, everybody would be getting the minimum wage (and we'd probably have been hived by now)
I suggest you study economics. You just got done saying that companies bid up the prices of the higher-skilled workers. Why wouldn't the same process happen for the lower-skilled ones? The fact is, that's what happens. If an employee is making a lot more for his company than he is being paid, a competing company will offer him more to come work for them. This applies to burger flippers as well as CEO's. If the going rate for burger flippers was $1, restaurants would find they could attract the best people by offering $1.50. Then the compeition would see they are losing workers and offer $2. This will go on until the per-hour profit due to one worker is approximately equal to that worker's pay.
I assume you have at least some knowledge of economics, so I find it strange that you'd take this position. No one argues that this occurs in any other market. Every market has a system of supply and demand, and the market price is determined by these forces. This is a simplification in some cases, but it does decribe approximately how things work. Thus a free market in labor would not lead to the price of labor dropping to zero and more than the price of soybeans would drop to zero. Companies compete for employees just as they compete for raw materials. And no one pretends that raw materials will be "exploited" without minimum prices for those. The same economic laws apply.
Can you think of a better Feudal architecture than the modern Corporation? And how much is the difference betweent the actual value of your work, and what you get paid?
That's just nonsense. Today's "serfs" make enourmously more money than any feudal serf, have much better working conditions, and a whole lot more freedom. Anyone in America is free to leave his job and seek another. There's nothing feudal about it.
As for the "actual value of my work," how can I determine that besides looking at how much other people are willing to pay for it? If no one will pay me more than $2 an hour, then on what basis do you claim that it is worth more? Labor does not have intrinsic value. It is only given value by those who value it. If I choose to sell my labor, that means I value the money more than my labor. And whoever buys it values my labor more than the money. There is no such thing as an "actual value," independent of who is recieving the benefits of that labor.
Do you feel that only the corporations deserve government subsidy?
I don't think anyone deserves subsidies. I'd cut back corporate welfare just as quickly as social welfare. I find it interesting that everyone assumes that if you are against government subsidies for the poor, then you must be in favor of government subsidies for the rich. That's nonsense. I don't think the government should subsidize anyone.
So long as you live in a Capitalist society, private industry has no incentive to eliminate unemployment, as unemployment is used as a threat to keep workers in line.
Um... "private industry" is not a single monolithic organization. Individual companies will hire qualified workers and pay them enough to hold on to them. Different companies compete to hold those workers, and offer to pay them more to attract them. So you're just wrong: private industry does not cause unemployment. In fact, right now, the unemployment rate is practically zero. The 5% who are not working are mostly between jobs or are seasonal workers. Anyone with any skills at all has no trouble finding a job.
What causes the unemployment is primarily the government. Things like minimum wages, Welfare, labor regulations, etc. Without these, the markmet would adjust so that pretty much anyone could get a job and support himself. If you don't believe me, ask yourself why almost everyone gets payed more than the minimum wage? Has the "downward spiral" not completed yet? Wages are currently increasing.
So I think you're just confused. Without capitalism, we would all be back to the middle ages, working at manual labor tasks and giving our meager surpluses to our fuedal lords. Capitalism has liberated the common man.
I don't have statistics, although the 2-3 trillion sounds about right. However, I do think we'd be a lot better without welfare.
Think about it this way: Welfare is a subsidy on being unemployed. Simple economics tells you that this will increase the number people unemployed. This is why the Welfare rolls have been steadily expanding, and why poverty has not been eradicated by the Welfare stat, but has expanded.
There are other problems too. Obviously, the money is one problem. Governments in general spend about twice as much to do the same job as the private sector does. The welfare program is riddled with waste and corruption. Also, a private charity organization would have much more incentive to get people off of the dole and onto jobs. So in fact the cost would be a lot less than half what the government spends.
The basic problem is that charity has come to be seen as an entitlement of the poor rather than a gift from those who pay for it. People who felt that they are simply demanding their rights are much less likely to do anything to get a job. There should be a social stigma about living at the expense of others.
So yes, people do lose their jobs and need help, but the private sector does a much better job in that roll. Government welfare has perverted charity into a tax-financed industry.
I know this is an unorthodox position, but ack yourself this: the government in the 60's initiated a "War on Poverty" with the stated goal of eradicating poverty. Today we have more poverty then ever, despite rapidly growing wealth. Clearly something is not working. Government welfare is part of the problem, not the solution.
the mac crowd is generally much less technical than the pc crowd. (This would mean that there would be fewer experienced programmers that would be willing to devote their spare time to working on it).
I don't think this is true at all. Certainly in absolute numbers there are going to be more PC hackers than Mac hackers, just cause there are more PC's out there. But there is a thriving Mac hacker community. Many of the users now flooding into the Mac commnunity as a result of the iMac are probably not hackers, but there is a core of Apple loyalists that have been buying Mac's for 10 years. Many of them are very technically minded. Myself included. MacOSrumors, MacInTouch, MacNN, AppleInsider, MacOpinion are all Mac news sites aimed at power users. There may not be as many of us, but we do exist.
And trust me: you, me, everybody would buy cheaper Intel versions of MacOS if they could. If some company ported a 99% compatible MacOS to Intel and undersold Apple by $1000, Apple would be out of business. Unfortunate, but true.
I wouldn't. At least not under any reasonable scenario. Apple's high end is now around $2500, so I'd be very impressed if someone could come up with the performance-equivalent of the G3/450 for $1500. Apple's pricing, though still a little higher, has gotten a lot better in recent years. The G3 kicks ass, and the G4's gonna be even better. Apple's claims of twice the MHz-for-MHz speed are probably exagerated, but a G3/450 is still a wicked fast machine. And with the upcoming copper and SOI technologies, the PPC will be faster, smaller, and cooler than x86 chips for a while yet.
And one of the biggest advantages of having a Mac is the complete system integration: the OS and hardware were made by the same company, and the two pieces were designed to complement each other. This means that you have much less trouble with driver conflicts, configuration, etc.
A Wintel port of Mac OS would also likely be behind the current Mac OS feature-wise, and it's not going to be binary-compatible. These two combined mean that even if there was a 100%-companitble Mac OS port, most newbies will just buy from Apple and save the hassle. And Apple's core graphics market will likely stick with Apple, as Apple's hardware is very strong in that area.
What Apple should probably do is Open Source 90% of the OS, and keep the remaining 10% proprietary. This is enough to give their hardware a significant advantage, while still reaping much of the benefit of the Open Source model. Or maybe they should just delay releasing the source for 6 months or so. That way the really cool stuff would still make them money, but users would still be able to hack the rest.
That, my poor anonymous coward, is where you are wrong. You can call it what you like, but the system I'm advocating is properly called capitalism. The only way to achieve a long-term monopoly is with government help. In a truly free market, someone will always be waiting in the wings for the opportunity to take your monopoly away from you. So even if you get a monopoly (which is extremely difficult) you can't afford to abuse it too much because you'll end up losing it.
The goal is no longer 'how can I enhance services to win more business from these people?', instead it becomes 'how can I slash their tires more cheaply than I could win business, thereby getting their business by default?'. If this tireslashing requires temporary inconvenience, well, one just has to take the long view, doesn't one?
You are confusing capitalism with gang warfare. If a business is slashing another business's tires, they should be thrown in jail. Slashing tires is completely different from lowering prices. "Unregulated" means that the government doesn't interfere with peaceful, non-coersive activities, not that you should be allowed to do whatever you please.
AMD is getting mugged already. They're losing a lot of money, and the amount of energy and virtuosity they've shown suggests that in a balanced market with many vendors, they would be pushing 50% maybe- they can do inexpensive, they can do a pretty decent yield, they can even do high performance, they can do PR, they can get vendors: what's not to like?
I am not aware of a single example in which Intel slashed AMD's tires or murdered their salesmen. If so, then I fully support arresting those involved.
Instead, they're being mugged- they are slammed into horrible losses not by virtue of them sucking that badly, but simply because they are up against a quiet monopolist.
What exactly is Intel doing that is so horrible? They certainly have not been mugged in any literal sense. You are confusing real warfare with "economic warfare." The first is and should be illegal. "Economic warfare" is a misnomer and should be legal. AMD has a good shot at unseating Intel, and there's nothing unfair about it. They knew the risks and challenges when they went into business, and they clearly think they can win. I think they might to.
For what they're doing, normally one would expect the company to make even a small amount of profit. I'm not convinced they can, whatever they do.
How do you figure? If the K7 is as good as AMD says it is, they stand to make a ton of money, even if Intel does slash their prices. If Intel's product really is inferior, then that means AMD can charge slightly more than Intel, and can thereby outlast them. And as I've said elsewhere, if they do have a superior product, then they will have no trouble getting the investor backing they'll need to stay in business.
And you're fool enough to call that capitalism rather than the feudalism it is- which is why you're a damned fool.
I'm glad you're not an AC, and you make some good points, but you didn't really address the specific reasons I gave. AMD is not a helpless victim on the verge of bankruptcy. The free market it not gang warfare, and it's not feudalism. You paint with an awefully broad brush. Slashing tires and lowering prices are completely different actions, and conflating the two only clouds the issue.
Wow, a non-anonymous, non-insulting, and interesting response. :)
Short-term, this will probably be true. However, investors/banks/whoever are not going to keep throwing money at a company indefinitely. If the company who is selling low has more cash, eventually they will force the other out of business.
But at some point, it starts to hurt Intel so much that even if they do drive AMD out of business, they won't be able to recoup their losses. If Intel attempts to charge monopoly rents, someone else will quickly see an opportunity and enter the market. There are a lot of chip makers who would love to get a piece of Intel's market. So At some point, it just does so much damage to Intel that they are better off just letting AMD have a piece of the market, and working to undercut them by developing better products.
Brian Larsen also made a couple of good points. In particular, if AMD is the underdog, they will be selling fewer total chips, and so they will experience fewer losses from the underselling. And they can temporarily shift their efforts to a different market until Intel raises it prices again.
The point is that the market is never as simple or static as the "predatory pricing" argument assumes it to be. Markets change, companies change. And it is next to impossible for a company to gain and keep a monopoly simply by bullying its competition out of the market.
I can't cite specific examples, but I think the empirical evidence bears this out. Most of the "dumping" complaints are basically just companies whining about getting trounced by a better competitor.
Short-term, this will probably be true. However, investors/banks/whoever are not going to keep throwing money at a company indefinitely. If the company who is selling low has more cash, eventually they will force the other out of business.
But at some point, it starts to hurt Intel so much that even if they do drive AMD out of business, they won't be able to recoup their losses. If Intel attempts to charge monopoly rents, someone else will quickly see an opportunity and enter the market. There are a lot of chip makers who would love to get a piece of Intel's market. So At some point, it just does so much damage to Intel that they are better off just letting AMD have a piece of the market, and working to undercut them by developing better products.
Brian Larsen also made a couple of good points. In particular, if AMD is the underdog, they will be selling fewer total chips, and so they will experience fewer losses from the underselling. And they can temporarily shift their efforts to a different market until Intel raises it prices again.
The point is that the market is never as simple or static as the "predatory pricing" argument assumes it to be. Markets change, companies change. And it is next to impossible for a company to gain and keep a monopoly simply by bullying its competition out of the market.
I can't cite specific examples, but I think the empirical evidence bears this out. Most of the "dumping" complaints are basically just companies whining about getting trounced by a better competitor.
Have you ever heard of Mr Andreas, and a little company called Archer Daniels Midland? (ADM - Supermarket to the world!) Lisene price fixing? 2 years jail time? Hmmmmm?
No I don't. Please elaborate.
But I will point out that ADM is hardly a creature of the free market. They make their money feeding at the government trough--recieving massive Corporate Welfare. So I doubt that it's a good example in any event.
do yourself a favor.. read a newspaper. It talks about the real world.
I love ad-hominum attacks and condescending attitudes. Especially when the person dishing them up won't even put his name behind them.
Might Makes Right
In fact that's the exact opposite of the truth. When's the last time you saw a Microsoft employee bursting into your home to inspect for Macs? Companies don't have "might." Governments do. That's why advocates of capitalism are so much more afraid of government than corporations. Corporations don't throw you in jail if you displease them.
The weak deserve no pity
That's not what I said. If AMD were to go out of business, I might pity them. I just don't think that we should prop them up if they are producing inferior products at higher prices. Besides, it's not like a company that goes out of business has all its employees taken out and shot. They find other jobs, and are not particularly hurt for it.
It is interesting to me that you choose to make AMD an object of pity. They may not be Intel, but they are far from a poor helpless mom-and-pop corporation.
All people must believe that no business ever suceeds without marketing a superior product. (*cough* Windows *cough*)
Windows sucks. I use it as little as possible, and I have never claimed that it is a good OS. But the fact is that people chose to buy it, because they believed it was the best value. Are you going to tell me that with your superior wisdom, you're going to determine the One True OS, and force everyone else to use it? Consumers have always had choices, and always will. If they make bad decisions, that's their choice.
Any individuals commenting on this are irrational, communist, anti-capitalist, and threats to the American Way of Life.
Given you out-of-context bromides and complete lack of content, I'd say the irrational part of it fits you pretty well. I have no idea if you are communist. You are clearly anti-capitalist. I'm not going to pretend that I have a monoply on the "American Way of Life."
not only does it keep the peons in line but it lets you feel that your superiority made you divinely ordained to lead.
Actually, this is a pretty good discription of statism. I don't know about you, but I don't consider myself a peon, nor a slave to my capitalist masters.
I'm surprised you've avoided noticing how our society works after living in it so long. (I assume you have ? )
I've noticed that the US is both the freest and the most prosperous nation in the world, and I don't think that's a coincidence. I've also noticed that the private sector is in general much more efficient, innovative, and humane that paper-puching bureaucrats and self-serving lawyers. Actually, I'm not even sure what you are talking about. Would you like to explain "how our society works?"
now AMD dosent have any cash to ride out a rough year.
Let's say a year from now AMD is about to release the K8, which is fast enough to blow Intel out of the water, but they're on the verge of bankruptcy. Do you seriously think they would have any trouble getting the capital they need to stay in business? They can go to any investor on Wall Street and say "how would you like to get in on the ground floor of the soon-to-be industry leader in the processor market." Lots of invstors will be willing to take that gamble. If they have a better product, then Intel will have to work hard to compete. If the K7 ends up being a flop, then I'm not gonna shed too many tears if they go under. But in any event, simply cutting prices and hoping AMD goes under isn't gonna cut it.
Also, keep in mind that AMD is not Intel's only competitor. There are lots of other chip makers. none of them make a competitive x86 clone right now, but if AMD stumbles you can bet somebody else will want to take a shot at it. Nothing Intel could do would give them a monopoly for more than a year or two. Then someone will see the opportunity to make a profit and will enter the market. If AMD ever does beat Intel, they will reap substantial profits from being the industry leader. So you can bet they're willing to take some heavy losses on the gamble that they can come out on top.
Boy, that's a helpful comment, especially coming from a coward. I reread my post, and I see nothing unethical about the things I wrote. If this was a serious comment and not simply a random flame, I'd be interested to see you back that claim up.
I don't think there is anything unethical about capitalism, competition, freedom, or low prices. Nor is there anything unethical about one company trying to increase its market share, even if that means that another company loses market share. What is unethical is punishing companies for lowering prices and providing services that people want. It is also unethical to harass productive businesses with nonsensical complaints about their "predatory" practices.
If you have an actual argument to make, let's hear it. But if you simply have a knee-jerk reaction against capitalism, then please don't waste your time. And while you're at it, get yourself a username and take responsibility for the things you post.
Intel knows AMD will run out of money first (like MS and Netscape).
Maybe that was Microsoft's plan, but it obviously never happened. Netscape is still developing its browser and giving it away, and they have used that to leverage their entry into the server market. What's so terrible about Microsoft and Netscape giving their browsers away is beyond me. Netscape recently got sold off to AOL/Sun for an ungodly amount of money. Doesn't look like Netscape ever ran out of money to me.
The same is true of AMD and Intel. The chances of Intel driving AMD out of business in the next few years is pretty much zero. Even if the K7 is a flop and they lose a lot of money on it, they still have a large enough market share to make a K8 and a K9. Intel would be pretty stupid to try a "predatory" pricing strategy for the 5-or-so years it would probably take to drive out AMD, since they'd lose a bunch of money in the process. And once they get their little monopoly and raise their prices, someone else will do the same thing AMD did and create another competing chip. There's just too much profit potential for anyone who can get a piece of Intel's market share for Intel to be able to keep a monopoly for long.
No I didn't miss the point totally. I addressed it head on. Did you even read my post? I said...
The point is that it is not usually possible to waltz into a market with a bunch of money, drive out the competition, and then recoup those losses in monopoly rents. If they don't have a product as good as the smaller businesses, those businesses will be able to survive.
I am not missing the point. I fully understand the point and I think that point is nonsense. There is nothing fundamentally different between
"predatory" price cuts and other price cuts. A business with a superior product has a good chance of surviving in the market no matter how much money the competition has to burn. The only way to drive someone out of business and make a profit at it is to make a better product, or find a way to produce it at lower cost. Capital markets provide mechanisms whereby smaller companies can get the operating capital they need to stay in business until the larger company gives up and goes away.
"Dumping" is the exact same idea as predatory pricing, and it has precisely the same economic flaws. The free market has a number of mechanisms that ensure that this type of behavior can be combatted. And in the process of combatting this imaginary evil, laws against "dumping" force consumers to pay more than they otherwise would.
I think it's great that Intel is cutting its prices, and I hope AMD does the same. A "price war" would be a boon to consumers, who would save money whoever they buy from. We should be encouraging price cuts, not whining about them.
These low prices may not even bring Burger Heaven a profit, but they serve the purpose of squashing the weak competition.
It's called competition. Companies compete to have the best product at the lowest price. Whoever does the best job gets a larger market share. That's just the way the free market works.
I don't know anywhere in the constitution where is it says that "mom and pop" stores have an absolute right to keep their market share. If Burger Heaven can produce a better product at a lower price, why should the government stop them?
Now it may be that Burger Heaven is actually trying to drive the mom-and-pop place out of business, but there are lots of ways to combat that. They can borrow money, sell shares in the business to friends, sell their store to McBurgers, Merge with McBurgers, shift to a different market, etc. Remember also that most of the customers in the area probably prefer their superior survice and hometown feel, and will stick with them even if the prices are a little higher.
The point is that it is not usually possible to waltz into a market with a bunch of money, drive out the competition, and then recoup those losses in monopoly rents. If they don't have a product as good as the smaller businesses, those businesses will be able to survive.
It is particularly ludicrous to argue that Intel is going to drive AMD out of business by cutting their chip prices if AMD has a superior product. AMD now has substantial industry credibility, and if it needed more capital, it could sell bonds or float more stock without more trouble. Lot's of investors will be happy to put up the money, in the hope that AMD will be the next Intel.
I get tired of seeing every move by Intel or Microsoft interpreted as further proof that they are evil, while AMD, Apple, Netscape, Motorolla can do the exact same things and no one cares. All companies cut their prices when competitors come out with a better product. That's life. Get over it.
I hate to add myself to the list of people who complain about grammar and spelling errors, but this really bothered me:
Interesting its a really excellent piece.
There should be a comma, period, semicolon--something--after "interesting." The "interesting" is a seperate thought, short for "that is interesting." I had to re-read that 3 times before I figured out what it was saying.
I don't want to nitpick, and it's really not that big a deal. But the little lead-in blurbs Rob writes are only a few sentences each. And thousands of us read them. Surely he can take the time to reread them a couple of times to make sure they are correct. Maybe he can even have someone else read them over. This would save those of us who are anal-retentive a lot of frustration.
The windows system, like the Mac system, is horrible. Having a seperate directory structure for programs and data is the way to go.
One important distinction: what you are saying is certainly true of a multi-user, shared system like Unix or Win NT. However, for Win95 or the Mac, where there's usually only one user, it is a different story. On my Mac, for example, I set everything up, so I know exactly where things are. It would be silly to give myself a "home directory," since there's only one user.
And I would argue that the Mac is usually set up better then the Windows equivalent. The Mac has one "System Folder" and as long as you don't mess with it, your system won't break. Likewise, there is usually an Applications folder, into which applications go, and documents are no normally stored there.
Of course this requires some discipline on the user's part. The best laid out FS in the world is going to break if the user doesn't take the effort to keep in order. But for a single-user machine, I'm not sure there's anything particularly wrong with the Win/Mac filesystem layout. The Mac in particular has a very well-designed set of conventions, IMHO.
Of course, it's lousy for multi-user environments, but that's what OS X is for.