"Get rich or Die tryin" is it the case with Whirlpool-Maytag ?!
Referring to the article “Regulators OK Whirlpool-Maytag merger”, Whirlpool is
having a bad time trying to merge with Maytag. Knowingly Whirlpool is the number one appliance manufacture in the US, while Maytag is the third behind GE consumer products. This merger was severely opposed by antitrust regulators: group of lawyers, who started operating after the Sherman Antitrust Act (1890), which is law designed to make illegal all trusts and other combinations that aimed to create monopolies in restraint of interstate commerce. Relating this article to David Baron’s we find the following:
Issues: The issue was derived due to Whirlpool potential merger with Maytag an aspect that allows the firm to control of almost 70% of the clothes washers and dryers besides half of the dishwashers demanded by the US economy. Moreover this merger is expected to decrease the competition for this industry and increase oligopoly (of which I believe would occur between GE and the new merger Whirlpool-Maytag leaving other competitors all the way behind).
Information: The information is basically under process; more studies are made by antitrust regulators, lawyers and Justice Department. As mentioned in the case “The department asked for more time to review the merger last month, prompting wide speculation that it was preparing to challenge the deal”, while the antitrust regulators commented “The antitrust division has been reviewing the proposed merger since September. The companies announced that they had signed a definitive merger agreement in August.” And executives from both companies declined to discuss how the merger would affect factories.
Interests: Interests include stakeholders of both companies. It was mentioned the Whirlpool and Maytag share’s prices rose by 27.7% and 7.1% respectively. This reflects our previous discussion that shareholders are optimistic that this merger would boost profits and decrease current competition. Other interests are the antitrust regulators and the Justice Department in the U.S. We could also add consumers as an interest group but am referring to antitrust regulator and department of just as the consumer’s representatives.
Institutions: As was mentioned in Baron’s framework, Institutions are regulators or in other words organizations having the authority to oppose new laws. In this case we find that the main authority is the Justice Department, although it ruled against the antitrust lawyers but the case isn’t settled yet as they requested more time to review some substantive matters. Another institution that’s not involved yet but I assume it will be involved as soon as possible is the Federal Trade Commission Consumer Protection.
In conclusion, I believe that this merger won’t be opposed or in other words it shouldn’t be opposed by the Justice Department because large retailers including Sears, Lowe's Companies Inc., The Home Depot Inc. Co. and Best Buy have alternatives available to help them resist any attempt by the combined company to raise prices. Not only this, but also competitors are numerous and almost equal in size such as GE and Frigidaire besides foreign competitors such as Samsung. And due to increasing demand those competitors could sustain their production units or simply increase their production.
Would Sony's PS3 delay break the barriers of Rivalry?
Is Sony’s PS3 delay harmful? Would it give a better chance to its competitors Microsoft and Nintendo? Would it increase rivalry and decrease Sony’s PS3 shares? Emphasizing on this and referring to the Article “Sony’s Delay of Game” and relating it to Porter’s framework we find the following: 
“Price cuts are quickly and easily matched by rivals, and once they are matched they lower revenues for all firms unless industry price elasticity of demand is very great” according to this statement in Porter’s framework we find that Intensity of rivalry among existing competitors does occur. Relating this to the article we find that Sony’s share prices fell by 1.8% in Tokyo Trading since it gave a better chance to its rivals Microsoft and Nintendo to increase their market share which is 70% acquired by Sony PS.
- Competitors are numerous or are roughly equal in size and power: I believe 3 competitors could refer to numerous since this could eliminate monopoly or oligopoly. Although Microsoft is the biggest in size, but its gamming department is somehow equal to Nintendo’s and Sony’s PS size. Microsoft’s gamming department doesn’t produce games per se, but they research and develop to arrive to a better game support performance that’s compatible with computer games manufactures. As for the power I believe Sony’s PS is the greatest with 70% market share in the gamming industry.
- Industry growth is slow: “Slow industry growth turns competition into a market share game for firms seeking expansion” Which totally contradicts our article since the industry growth is fast. And as was stated in the article “not everybody thinks being late is a huge liability” a period of 3 month would still keep Sony’s PS at the lead.
- The product or service lacks differentiation or switching costs: Referring to the article “When completed, the PS3 will play all PlayStation games, old and new, as well as high-definition movies. It will let users surf the Internet via a broadband connection and sport a 60-gigabyte hard drive to store downloaded games or music, a wireless antenna to link to other Sony gizmos, and a tiny camera for chatting with friends over a video hookup.” All of this proves that Sony’s PS has maintained huge differentiation and low switching costs not only because of the technology but for its loyal customers.
- Capacity is normally augmented in large increments: “He said he plans to prepare 1 million PS3 consoles for the worldwide launch and have enough capacity to roll out another 5 million through the end of March, 2007” For the first Sony would offer 6 million consoles which means 0.01 console to each individual on earth. I believe for the first year this is a big number! Accordingly the supply is being offered in large increments which would urge other competitors to cut prices.
- Exit barriers are high: Obviously “Strategic Interrelationships” is one of the most competitive disadvantages in Sony’s core business. Since the PS business unit is highly correlated to Sony’s image as a whole this causes the firm to perceive high strategic importance to being in the business.
In conclusion I believe this delay won’t affect Sony’s PS manufacture since it has a competitive advantage that eliminates any rivalry at least for the Short Term.
To all Bloggers watch out Google's Blog Search
Is Google the potential competitor in terms of Bloggers? Would Google gain market s
hares after they were successfully distributed among market leaders Technorati, Blogpulse and newcomer IceRocket? Let's discuss the article from Porter's point of view. Although some of the critics would take the case as rivalry among existing competitors, since Google is a well known search engine that could invade search engine markets anytime anywhere and easily attract customers given that Blog search engine is to be offered as a complement to Google's main objectives. But I'd prefer to be more logical and discuss Google's perspective as a potential entrant in view of the fact that the three market leading Blog search engines are considered specialists in this field of interest.
I believe the biggest potential hump that Google would face is in terms of "Bargaining Power of Buyers", relating it to this case "Bargaining Power of Blog Surfers". - Purchases are large in volume relative to seller sales: As a matter of fact Blogs and Blog Surfers are increasing tremendously in this time horizon since it attracts surveyors, news reporters, students and many other slices of the economy due to its short written analysis, opinions of fact and different criticisms; allowing this product to be well differentiated from old traditional long compositions discussing every single detail that are sometimes proposed to professionals and presented in newspapers. Relating this issue to the case we know that Google has lost a great market share to old established competitors.
- The product it purchases from the industry are standard or undifferentiated: As products are hardly to differentiate and existing competitors are available anytime to offer high quality services, Google must be able to differentiate its services by conferring a high quality of service and user-friendly interface.
- It faces few switching costs: As I mentioned earlier Google should start considering this service as a complement for its well known products and thus gain and attract existing customers by offering other services like Blog surfing.
- The product it purchases from the industry represents a significant fraction of its cost or purchases: As a matter of fact buyers barely pay a significant amount of dollars to access or use Blog search engines, so buyers are less price sensitive which makes it more challenging for Google to attract current customers, unless as mentioned earlier this product was offered as a complement for Google's current customers.
Finally I believe Google should offer more than just Blog search engines, but to reserve the rights to practice more power on its biggest free blogging service as it was stated in the article "Google already runs the biggest free blogging service in the world, Blogger". For example decreasing the efficiency of the leading search engines by applying certain codes for word search among articles.
having a bad time trying to merge with Maytag. Knowingly Whirlpool is the number one appliance manufacture in the US, while Maytag is the third behind GE consumer products. This merger was severely opposed by antitrust regulators: group of lawyers, who started operating after the Sherman Antitrust Act (1890), which is law designed to make illegal all trusts and other combinations that aimed to create monopolies in restraint of interstate commerce. Relating this article to David Baron’s we find the following:
