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2018-02-21 09:30 by Karl Denninger
in Corruption , 171 references Ignore this thread
An Interesting Perspective On Netflix
[Comments enabled]

This is an interesting perspective on the Netflix "content at all cost" scheme.... and where it will end.

The scheme goes like this: Buy up as much talent in town, as quickly as possible, and it’ll all pay off later. Doesn’t matter how much you have to pay. Trust us, the financials will work out very nicely in the future. Because we will simply chase everyone else out of the game. Just give us a lot of money, so we can make sure that everyone else will go bust - before we do. It will only take us a few short years to make that happen. Then, we’ll be the only option in town. We will control everything. We will be able to squeeze the amount of money paid for talent back down, while charging our customers a ton of money. We will be the last man standing, rolling in dough.

The author notes that this has never worked -- and in fact has either bankrupted or led to enormous losses for the investors.  But there's another point here that really ought to be explored, and this guy misses it:

The essence of this scheme is quite-arguably a criminal enterprise.

The key is right in those two bolded sentences.

Why?

Because 15 USC Chapter 1 section 2 prohibits an attempt to monopolize or restrain trade under criminal penalty.  Section 1 prohibits attempts or acts to restrain trade.

Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court.

You don't have to succeed to be guilty -- you just need to try.

Just as in health care the essence of schemes like this and the money lost is not simply if the scheme fails or not.  It's that the losses taken whether by customers or investors should never happen in the first place because the scheme itself at its foundation is a felony criminal act and, if it were punished just a few times people would cut that crap out!

It is only because our government refuses to enforce 100+ year old law that makes such a criminal act that these schemes persist and ultimately screw customers, investors or in many cases both!

So when does this crap stop?

Only when you, dear American, demand and enforce that the government do it's damn job.