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Comment by gumballindie | Hacker News Reader

This comment is underrated. Basically what these businesses do is they sell their products at a dumping cost. If that practice is illegal for physical products then so should it be for software.

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Well, sure, but that’s essentially impossible to define for a product with zero marginal cost. You’d be making it illegal for a small company with x sales/year to sell for the same price as a large company with 2x sales/year.

At a very minimum, you can make it illegal to price a product below its marginal cost. This would have prevented e-commerce/rideshare/delivery companies from using VC-funded discounts to gain market-share and destroy less-funded competitors.

I agree with the sentiment, but it's not correct that price dumping is illegal for physical products.

Trade treaties and WTO rules cover dumping in international trade for obvious reasons, but to my knowledge, there's no law in the major western jurisdictions covering domestic dumping.

Domestic dumping may be prohibited as predatory pricing under anti-trust, depending on the circumstances, including the pricer needing to have market power.

Right, but there is zero differentiation there between physical and virtual products. GP implied that there is some sort of protection against price dumping of physical products that doesn't exist for virtual products.

The differentiation is in your choice of terminology. "Virtual" products have zero marginal cost, and the statute mentions marginal cost. The statute doesn't have to mention "virtual" products because it mentions marginal cost.

https://www.ftc.gov/advice-guidance/competition-guidance/gui... notes that there are dumping restrictions, but that courts rarely find firms in violation.

Asking ChatGPT "What is the case law around single-firm predatory pricing?" provides a number of examples, including the tests used by various Western court systems. (Though do note that ChatGPT is not a lawyer, and this is not legal advice!)

Correct, anti-trust law can introduce a lot of rules prohibiting actions that would be fine if it weren't for the monopolistic position of the actor. But as mentioned in the other comment, there's no differentiation there between physical and virtual products.

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