Author: Fernando Villegas
Date: 15:43:08 11/02/98
Hi: The long thread about microsoft becoming a chess monopoly and/or Chessbase being the Microsoft of chess programming busines has some flaws in the economic side of the analysis I would like to fix to expel from your hearts the panic you have :-). To become a monopoly is not enought the financial potential to become one; it is neccesary nobody else has the potential to do the same. in fact monopoly, more than an issue of market share, is an issue of critical mass of financial resources. You become monopoly when the market AND the product are such that a next phase of development requires huge amounts of capital that in the long run are available for only one or two great players. This market mut be very great AND the product should requiere a huge expoenditure of money to get aditional progress. Examples are computer, airplanes, cars industries... When this factor concur, sooner or later the first David Crockets of the industry vanish as much thet cannot get enough money to do so. Take a look at the automobile industry in the beginning of this century and you will see how many little factories existed producing sometimes incredibles cars, a lot better that the A Fords that got the lyon share very soon, but they had not the money to produce in mass quantities and/or invest in the heavy machinery required to multiply the output, to begin with. So they were crushed. But in this industry the requisites are very different. Professional Chess programming is not a great market that requires a huge investment in distribution channels to be reached and coped. And a chess program is not a product that requires much more that the wit of the producer. In other words, anybody with enough skill and interest has the chance to become a player here, to be known as a player, although this fact does not means that every player will get enough money from it. The danger for this field is not that Chessbase or any other will close the avenues to any other creative guy, because they cannot do so, but, on the contrary, the danger is too much players for the market such as is it. So the problem of the future -or present- is the opposite: not an uncoming monopoly, but too much players or, in other words, lack of monopoly if you wish. We can see this issue in the follwoing way: If no big companies are available to take care of this tiny market employing, let us say, a dozen or so first class programmers, these last should survive on personal ground and initiative and many of them wont make it. Instead of a dozen productive programmer working for two or three companies, we will have 12 magnific independent guys out of business. Which is the best outcome? Fernando
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