Tuesday, October 26, 2004

I (Still) Love Competition

According to a recent article, Netflix has lowered its price to 17.99 a month, due to the threat of Amazon entering the market. And in response to pressure from recent entrants Blockbuster, entering at 17.49, and WalMart. Its worth noting that just a few months ago Netflix raised its price from 20.99 to 21.99, but now it looks as though they fear marauders. Economic theory tells us easy entry and exit should keep profit down, looks like it in this case.

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