Performance of eBay
An economy which is basically driven by a limited number of service providers can actually benefit from that arrangement. This could improve service rates, value for many and customer satisfaction. In reference to the given scenario, the owner of the cable company basically defends the city ruling because in effect, she is really at an advantage. The main essence in such a situation is that the owner actually knew that having a non-regulated service sector in a location can poise greater risks in terms of competition.
In that case, it would be naturally hard for her to attend to the different capability factors in monitoring her future competitors if ever the city will not regulate the utility segment. Apparently, having too many competitors will eventually divide the consumer base into scattered units therefore limiting the capacity of the cable owner to earn profit. In that case, a regulated utility can provide larger profits for the companies supporting a particular or limited segment (Sherman, 1977).
If one will take a look at the performance of eBay today, it may seem that the company is actually arriving at a point of complete success over its electronic platforms. It is very possible that other competitors will rise with the same strategy of eBay but actually, these companies will only rely on eBay’s experience in using its technology. In that case, eBay will then again have a definite advantage of controlling the overall segment of online auction systems.
It is very likely that antitrust issues will rise against eBay in the future. Most likely, there will come a time when the internet auction platform will become saturated that any new business entity will only depend on eBay’s technology, allowing it to dominate the entire internet segment.
Sherman, R. 1977. Ex Ante Rates of Return for Regulated Utilities. JSTOR. Retrieved February 14, 2008 from http://links. jstor. org/sici? sici=0023-7639(197705)53%3A2%3C172%3AEARORF%3E2. 0. CO%3B2-D.