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Comment by 6cd6beb | Hacker News Reader

>In the case of maps, there weren't many great alternatives for a long time, due to Google sucking all the oxygen/profit potential out of the field with their excellent free offerings.

ianal and all that, but isn't somewhere antitrust- or monopoly- adjacent?

I know if walmart moved into a new city and started giving away hardware for free, then waited until all the local hardware stores had been shut down for 10 months, and then jacked up their prices to 100 times what they used to be before going free, that'd be pretty illegal.

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IANAL either, but yeah, the practice you're describing, using revenues from other parts of a business to subsidize the areas it wants to compete hard in until the competitors are dead, is typically known as "predatory pricing", which is illegal. IIRC, Standard Oil was a big user of that playbook.

I don't know if this qualifies, and I don't know how much appetite there is for prosecuting Google for offering useful things for free. I don't think they've had much of a history of jacking up prices after killing off a market, until relatively recently. Interesting question, though.

Isn't this done all the time by Google though? They offer so many services for free, such as the consumer version of Google Maps, or YouTube (in the early days before ads)?

Not to mention Internet.org from Facebook, TOM's (free) shoes in Africa.

It does sound a lot like it, but I don't know if there's some other element you have to do to make it engaging in predatory pricing, or if there's just been no will to prosecute them yet. The FTC seems like it's been relatively lax on antitrust recently, so I could believe it's just the latter. Or maybe it's just the remnants of the free pass that governments gave the early internet, and we'll start seeing more.

What do you think about startups that give away webviews for free?

This is what drug dealers do.

It was also the plot of the James Bond film Live and Let Die.

Are you saying drug dealers go around giving their product for free until no competition or we are hooked?

I don't really think that happens at all. If so where are they?

I doubt anyone is driving out competition with free product, but using free product to hook a new client is definitely a thing that happens.

That's not too say that there's guys on street corners offering free drugs to random passersby. Rather there's lots of dealers who just deal to aquaintances, friends, friends of friends, neighbors, etc. In that case they can spread a few hundred dollars worth of product around to non-users within their social network in hopes of picking up another client or two, who will end up generating reliable profit for a long time.

Don't Uber and Amazon do that already?

i think uber at least (not that i want to defend anything they do) is different, because they don’t have low rates to smother their competition; they have low introductory rates to attract riders and drivers to the service

unsure if that’s also predatory pricing? seems different to me

Just because they have a nice PR-friendly story to tell doesn't make the pricing any less predatory. The point of predatory pricing is to attract people to the service, to shut down competition.

> they don’t have low rates to smother their competition

Whether their competition is Lyft, Taxis, or public transportation, their subsidized pricing is a big factor to their customers.

And WalMart.

Yes. Web search: "Amazon diapers.com".

Walmart practically did this but with a little twist back in the days. They opened multiple extra stores within a very small geographical area. Some stores were actually losing money but it didn't matter to them because they used it to completely destroy all competitors in that area and forced them to close up their shops. Once everybody is gone, Walmart has accomplished their mission and then proceeded to shut down the extra stores as well.

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