Robber Barons in Space

>>

> I believe that I indicated that it could be attempted by a standard
> setting body. The penalty you describe would be the intent. But,
it
> would be more effective if the market were monopolized by a single
> entity. This way, standards would essentially be enforced by
fiat.
> This is what I meant by developing controlling market share. I'm
not
> sure if it's possible... As you said, "Devil is in the Details".

As I'm reading your writings on this matter it strikes me that you
may be referencing a software market model and its reliance on
standards for gains in efficiency and interoperability. If this is
indeed the case, I have reservations about its applicability to the
business case you're trying to make.

Interoperability is the key benefit found in software standards,
whereas manufacturer efficiency and lower unit cost, both derived
from large market share, are the key benefits found in steps 1-4 of
your plan.

Without the efficiency and lower unit cost, the ease of replacement
issue may come to naught. If your design, with its common coupling,
only offers a savings of 1% over a custom designed coupling, then
that may not be a driving factor in your quest for market dominance.

With multiple players, a standard is usually adopted in order to
facilitiate market acceptance, lower development costs, and permit
interoperability. Standards by themselves don't usually lead to a
dominant player emerging because all of the players have equal
access to the standard.

ALso, don't neglect the players who don't adopt the standard and
work actively against it and promote their own internal standard
(Microsoft Java vs. Sun Java) or try to establish an alternative
coalition for their standard.

In the end, I don't see a widely accepted standard leading to a
dominant player.

When you write "it would be more effective if the market were
monopolized by a single entity" I have to ask by what gauge you
measure effectiveness? If that gauge is solely the adoption of a
standard then there may be many other gauges in which this single
entity fails, and I'm not yet convinced that the single gauge is the
best measure by which to judge the endeavor.

>>

>
> The penalty you state would be imposed if a majority of companies
> (read market share) adopted the standards imposed by the standard
> setting body. This requires a heavy hitting group of professionals
> to pull this off.
>
> Or, a group of companies comprising a majority market share could
> form a conglomerate. They cannot legally garner more than 80%
market
> share, but they could get close enough to wield the necessary
power.
> (Maybe?)
>
> Of course, there's the old-fashioned way -- acquisition.
>
> Might be other ways...

Again I reference the software model, and if a maverick company
bucks the standard, then they cannot interoperate in the larger
marketplace. That is definitely a hindrance in the computer market
(IBM vs. Apple), the cell phone market (Europe - GSM 900; US -
Analog, TDMA, CDMA, GSM 1900; Japan - PDC), TV braodcast markets
(NTSC - US and Asia; PAL - Europe; SECAM- France) and also video
with its classic Beta vs. VHS battle. In these cases a common
standard defintely helps achieve many goals.

But there are many markets in which a single standard would be of
little value. Consider auto tires; they are designed for specific
functions and that functionality would be lost by incorporating a
single standard. To take the example further, consider the common
zipper; what benefit would be gained by having all of the teeth from
every zipper being able to intermesh. I would venture the opinion
that all of the goals that you hold out for solar panel inter-
connectivity could be applied to the zipper model. Would the cost of
zippers come down so much so as to make the standard palatable?
Other than achieving the goal of having a dominant player or
standard, what else is accomplished? Repairing half of a broken
zipper is now easier because any other half of a zipper can be used.
In the end I don't see the "zipper" standard leading to a monopoly.

>>

Steps 1-3 describe
> a "typical" (albeit, large) solar panel manufacturer. This is a
> proven business that could survive for the 15 requisite years.
Then,
> it could begin to expand into the solar panel replacement biz.
Yes?

In short, yes, but in a more lengthy analysis, I have to ask how the
solar manufacturer has achieved its large size? Is it through
defensible intellectual property, superior product which cannot be
duplicated, innovative financing, or a myriad of other avenues? I
have some trouble with this conceptual leap because solar cell
manufacturing is more like a commodity business and is open to many
players who may be willing to invest their resources in the
endeavor. I can't see how a dominant player is going to emerge.

While this one player is incorporating their standard coupling on
satellite solar panels for fifteen years, their competitors are
doing the same with their preferred standards.

>>

> These are all good questions that I don't think need to be answered
> in the business plan. This is the research arm of the business.
> (Another reason for creating a company with large market share. It
> takes bucks to do this kind of research. The bigger you are, the
> more you can spend.)
>
> Make sense?
>
> Chris.

One doesn't create a business with a large market share, that market
share is the result of other actions that are taken within the
business. Thus, the stategy of the business must be successfully
implmented in order to bring about both profitability and large
market share. Is a standard satellite coupling the sole strategy
that a solar cell manufacturer is relying on, and if so, how does
that feature lead to market dominance and increased profitability?
Those are the issues that I'm having trouble grasping and your
further expalnation would help me understand.

TangoMan