Study Guide
Anti-Competitive Practices
An anti-competitive practice is one performed by a company (Usually
a large market leader) designed to hurt the ability of other companies
to market their competing products. Three examples of this practice
include Vaporware, Price Undercutting, and Forced Bundling. Vaporware
is the unreasonably early announcement of a product in an attempt to cause
customers to wait for the announced product, rather than purchasing alternatives
already available. Undercutting is the practice of lowering the price
on a product below a level of reasonable profit in order to drive competitors
out of business, so that prices can later be raised. Finally, forced
bundling is requiring retailers to sell two seperate products together,
usually involving a new product being forced along with an older and more
popular product. Much legislation has been passed to prevent these
practices and discussion can be found at www.antitrust.org.
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