Last time, I shared with you the story of Phoebus – a 20th century cartel that sought to fix light bulb prices as well as harm product innovation with reduced longevity. Doing so would mean strong demand for replacement products, and fortified sales volumes. Since those early days though, some economic literature has surfaced to formally analyse the rationale behind planned obsolescence in imperfectly competitive markets. With this understanding in mind, we find that there are plenty of remarkable examples of planned obsolescence today.
The technology sector- what’s a firm to do?
Hot off the heels of the recent Apple vs. Samsung trial in the U.S. there has been heated discussion over what implications this ruling will have on the future of technology companies. While Apple walked away from the trial with a definitive victory and another $1.05 billion to add to its already overweight piggy-bank, could this triumph actually be a curse in disguise?