Comment Re: Why? (Score 1) 144
A key component of our strategy course is something called Market shaping. That's basically how to collude without technically colluding. The way they phrase it is that you don't want to compete on price because that erodes profits for everybody. Although naive economics would suggest that if there's a market for buying versus renting that market would be fulfilled it's not quite that simple. If renting is more profitable then, as other posters alluded, the people who are renting will have more money. They can use that money to help put the people doing the direct sales out of business or otherwise obstruct their market. The easiest thing of course is just to buy them up and change their model to match yours. You can also use your profits from one market to temporarily subsidize another Market. The latter strategy works in many cases even without driving the competition out of business - they get the message and play ball rather than engaging in a price war.