Lenin in Essen

[Michael Perelman]

Because of the earlier enforcement of antitrust laws, the fashion in mergers
change from amassing more and more of one's competitors to looking for
synergies.  This began in the 1960s, failed, and then reemerged again.  Time
Warner and AOL did not merge because they were in the same market but because
they thought that they could feed off each other's market by promoting one
another's business.

Also keep in mind that term that Doug likes so much -- globalization.
Concentration in the automobile industry used to be counted by the American
firms to supplied the American market.  Now, automobile producers from Europe
and Japan and even Korea have to be included.

Finally, the point about the definition of a market is crucial.  More and more,
commodities are differentiating themselves.  Sneakers have become running shoes,
crosstrainers, basketball shoes ....

As I recall the Harvard Business Review article, the key point was to look for
new opportunities -- such as when the Williams companies turned their gas
pipelines into telecommunications right-of-way's.

--

Michael Perelman
Economics Department
California State University
Chico, CA 95929

Tel. 530-898-5321
E-Mail michael at ecst.csuchico.edu