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Why Microsoft Can't Compete With iTunes 249

Posted by Hemos
A reader submitted "Why Microsoft Can't Compete With iTunes which is an interesting op-ed piece about the differences between the two companies, but also the intersection with a different type of business like that of television. I've read some of the same arguements before, but this piece ties it up nicely together."
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Why Microsoft Can't Compete With iTunes More

Why Microsoft Can't Compete With iTunes

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  • - conspicuously repeating the cult-like phrase "recommends Windows XP Professional" in all marketing;

    - never advertising PCs sold without an operating system, or with an alternative OS installed;

    - applying Windows stickers to all PCs sold, and using a keyboard with a prominent Windows key.


    Doesn't this go against the terms of the antitrust settlement with the DOJ?

    • No. (Score:5, Informative)

      by Kadin2048 ( 468275 ) <.ten.yxox. .ta. .nidak.todhsals.> on Friday October 13, 2006 @12:04PM (#16424431) Homepage Journal
      The U.S. DOJ settlement against Microsoft did very little. I would argue it basically did nothing of any relevance, certainly nothing that fundamentally changed Microsoft's business practices. If anything, it probably emboldened them, since the end of the settlement made it harder for a new one to be brought against them in the future -- it demonstrated that the U.S. government didn't have the political cojones to actually do anything meaningful.

      Here's the DOJ's lame info site on the settlement:
      http://www.usdoj.gov/atr/cases/ms-settle.htm [usdoj.gov]

      • Re: (Score:3, Insightful)

        by Anonymous Coward
        it demonstrated that the U.S. government didn't have the political cojones to actually do anything meaningful.

        Not quite. The US Government could do something quite meaningful if it chose to. This administration, however, chose not to do anything meaningful.
        • As opposed to the Clinton administration which let the DMCA pass through?
          • Who said in opposed to anything? The executive enforces. It's not enforcing the laws. I didn't realize the Clinton administration was failing to enforce the laws of the DoJ microsoft ruling.
          • As opposed to the Republican controlled House and Senate who passed it in the first place?

            Don't turn the whole "politicians whoring themselves for money" into a partisan issue, because they all do it, and pretending like it's partisan just distracts people from the problem.
      • Wish I could add more to the discussion, but the site is slashdotted, so here's the coral cache link [nyud.net].

        When I get back from my meeting, I might think of something more useful to say.

    • Re: (Score:3, Insightful)

      by MobileTatsu-NJG ( 946591 )
      "Doesn't this go against the terms of the antitrust settlement with the DOJ?"

      So.. what.. Microsoft can't sell anything anymore?
    • I was not aware that the antitrust settlement was a gag order that primarily prevented Microsoft from merely saying things (which are the three things you list). Sounds more like a gag order/ censorship package than any sort of antitrust settlement (which would be a limitation on actual practices, not speech).

    • Re: (Score:2)

      by AusIV ( 950840 )
      1. Reccomending something is not the same thing as manhandling people into using it.
      2. This is questionable, but there manufacturers that sell PCs with your choice of Windows or a Linux distro. I'm not aware of any big OEMs that offer PCs without an OS, however.
      3. I believe windows stickers are applied to all PCs sold with windows, which makes sense. Regardless, a sticker doesn't require you to use the operating system. Same with the keyboard. I'm typing this on a machine running Kubuntu, and I use the "w

  • Somebody tell me quick... (Score:4, Funny)

    by justinbach ( 1002761 ) on Friday October 13, 2006 @12:02PM (#16424411) Homepage
    what airline I can fly to have an iPod built into my headrest, and a Ballmer-Zune hybrid for a flight attendant?

    • Re: (Score:3, Funny)

      by ciaohound ( 118419 )
      That's no flight attendant. It's a space station. Turn the ship around.

    • Re: (Score:2)

      by necro81 ( 917438 )
      Flight attendant? Heck no! That's Balmer with a dynamite vest strapped on (and sweaty pits if you look closely enough). He's going to take out the plane, isn't that cute?

  • How about... (Score:2, Interesting)

    by abscissa ( 136568 )
    The fact that the market is saturated alredy with people who can use iTunes and who own iPods? What is the insentive to switch?
    • > What is the insentive to switch?
      Ummmmmmm... "Oppose us and we will crush you"?

    • Re:How about... (Score:4, Insightful)

      by 2nd Post! ( 213333 ) <gundbear.pacbell@net> on Friday October 13, 2006 @12:13PM (#16424587) Homepage
      How about a better product?
      1) Microsoft could have easily designed the Zune to be a better MP3 player; build in a microphone for active noise cancelation and automatic volume adjustment, and provided an API for games, applications, and synchronization, and accessories.

      How about an easier to use product?
      1) Microsoft could have easily had the Zune do wireless sync; bring it near your host computer and everything gets synched. No plugging necessary!

      Apple CONTINUOUSLY creates incentives for people to upgrade and replace their iPods by releasing better iPods:
      1) Better battery life
      2) Smaller
      3) More features
      4) Cheaper

      Marketing only goes as far as product quality; a poor product won't last more than one generation. Apple is on seven now.

      • Re: (Score:3, Insightful)

        by maeka ( 518272 )

        1) Microsoft could have easily designed the Zune to be a better MP3 player; build in a microphone for active noise cancelation and automatic volume adjustment

        Active noise cancellation does not work when the microphone is three feet away from the speaker. (As it would be when the Zune is on your hip and the earbuds are in your ears.)
        Automatic volume adjustment would not only be difficult depending on where you wear your Zune, but potentially dangerous. Unless you are using a known set of headphones the Zun

      • because they have deep, DEEP pockets.

        It doesn't matter if it's an absolute failure the first time, the second time or even the third time.

        Remember windows didn't even catch on until 3.11

        By that time, they had learned, bought or stolen enough tech expertise to score a win.

        Then they leveraged their position to strong-arm sellers (not buyers) into carrying it.

        But this time, I am not sure that they can win because of their prior 'success.'

        The battle for the desktop was won but it has turned out to be a stright
      • One thing they could do to sell more ipods is to make their ipods work more independently of itunes. I use my ipod not to play itunes purchased music but to play back mp3s created from my CD collection. I do not care for itunes at all. A couple of things. I can't just copy a picture onto my ipod. I have to sync a folder. I can't just delete a song from the player I want I have to delete it from itunes and then sync the player. I can't just delete a picture either right from the ipod. In fact, I can'

    • Have you looked at the AFTERMARKET? (Score:5, Insightful)

      by ackthpt ( 218170 ) * on Friday October 13, 2006 @12:19PM (#16424699) Homepage Journal

      The fact that the market is saturated alredy with people who can use iTunes and who own iPods? What is the insentive to switch?

      Apple's footprint is extended by the aftermarket, where Zune won't even have one for months or years. I was in CostCo a week ago and was stunned how many portable stereos there are with an iPod cradle. Must have been a dozen, all different manufacturers. While shopping for a new car radio I find lots of them offer an option to hook up your iPod.

      Well. Looks like Apple doesn't just have a market, but a solid market. Apple's worst enemy at this point could only be themselves by changing something and screwing these aftermarket partners who provide them with greater value.

      Microsoft could only achieve this quickly with some very large incentives ($$$$$$$$) given to manufacturers to adopt their platform and I don't see that happening soon enough for the holiday shopping season (which has already begun, dontcherknow.)

  • this bit is interesting .. (Score:5, Interesting)

    by rs232 ( 849320 ) on Friday October 13, 2006 @12:04PM (#16424435)
    The Power of Monopoly

    Interestingly, while Microsoft's monopoly power dominates the PC industry, it didn't achieve that position in the same manner as Apple found success with the iPod. This is very important to understanding why Microsoft can't compete with iTunes.

    It has everything to do with choice.

    More than 80% of Microsoft's revenues for Windows come from corporate volume licensing and OEM copies of Windows bundled with new PCs. That means the company doesn't have to compete to sell a product at retail.

    • Why corporations CHOOSE microsoft (Score:4, Informative)

      by klubar ( 591384 ) on Friday October 13, 2006 @01:32PM (#16426053) Homepage
      I read your article about the "Microsoft fallacy", but you seem to have totally ignored the corporate market. If a Fortune 500 company really wanted to buy machines without Windows licenses they could easily cut a deal with Dell. Dell already sells machines without OS's (see the workstation/server pages) and can special price & configure machines--in fact, they'll even preload any OS/software you want on a machine (minimum quantities apply). However, big corporations really want Windows--it's easily remotely administered, works well with other applications (especially Exchange) and there is a large ecosystem to support it. From secretary training (how to log in, use word) all the way up to advance internals experts. From a corporate point of view, Windows just works.

      Because the big corporation use Windows, all of the smaller firms that buy or sell to the big corporations frequently need to use windows. Sure I could deliver a presentation myself using keynote, but the first time I send it to a corporate client will be the last time with that client. Same thing with sending a document in a "weird" apple font (sure they can open it, but it will look strange--the question will come back "can't you just put it on a PC?".)

      The iSeries (iTunes, iMove, iGarageBand) is essentially meaningless in the corporate environment. Apple has pretty much given up any hope of getting more than a pip of share in companies with more than 500 employees. The same thing is somewhat (although not completely) true in the educational market.

      The training cost of a new hire who doesn't know how to use Windows/Office is higher than one who does--two identically candidate--one who is ready to go and the other who "gee I've only used a Mac, but boy can I operate GarageBand" which would you hire?

      Apple are cool, shiny objects--just keep them at home.
      • "From a corporate point of view, Windows just works."

        I think this point of view might be slipping from dominance. You speak of the population of pre-trained/semi-trained people who can run a windows machine. This is a good thing from the corporate point of view, but at the consumer's end this is what leads to the script-driven tech support system that (to me, at least) is extremely frustrating.

        When I call my ISP for support, I want a guy who knows what an SMTP server is exactly, not a guy who asks what vers

        • Re: (Score:3, Interesting)

          by EggyToast ( 858951 )
          Similarly, a lot of the tools that are windows-driven are not dependent on critical thinking skills. How long does it take to train someone to use Excel if all they have to do is enter data in a spreadsheet, and that's their only job? Is that a useful skill that will make or break a company? Or will someone with the skills simply be a little faster to start?

          Conversely, Excel runs just fine on OS X -- no reason someone can't use it. And the majority of companies who use singular tools like the grandpar

      • Re: (Score:3, Insightful)

        by rolfwind ( 528248 )

        The training cost of a new hire who doesn't know how to use Windows/Office is higher than one who does--two identically candidate--one who is ready to go and the other who "gee I've only used a Mac, but boy can I operate GarageBand" which would you hire?

        I'd look for a 3rd candidate that doesn't need training when moving to a functionally equivalent push n' click program. These other two, tied to a specific OS, don't sound economical in the long run if they need training for every small little thing.

  • DRM does it (Score:3, Insightful)

    by From A Far Away Land ( 930780 ) on Friday October 13, 2006 @12:04PM (#16424437) Homepage Journal
    Microsoft can't compete with iTunes because they are dead set on keeping their WMA DRM PlaysForSure-Maybe technology.

    If anyone hopes to one day defeat iTunes, they'll have to do it by making music more convenient to listen to, not at least as hard.
    • Except from what I've heard, Zune isn't going to use PlaysForSure, it's going to use some other DRM system that won't be compatible with existing (Sandisk, etc.) PFS players.

      So they've basically written PlaysForSure off as a failure, it would seem -- or at least it looks like it. I don't know what you call a DRM system that you refuse to use on your own products, if not a failure.

      But if you read TFA, the reasons for Microsoft's predicted failure are not just that it's hawking a more restrictive DRM system than Apple is (which I'm not sure most people care about) but because their experience just doesn't translate over into the new market. With the exception of the xBox, Microsoft really doesn't know anything about consumer electronics, and their major product is maintained through aggressive marketing agreements that don't allow for any consumer choice. In short, they're crappy at actually getting people to buy their stuff, when they have a choice. Apple, on the other hand, has been fighting an uphill battle for years and knows how to woo people, both via their brains and wallets.

      • XBOX not profitable (Score:5, Interesting)

        by businessnerd ( 1009815 ) on Friday October 13, 2006 @12:54PM (#16425425)
        With the exception of the xBox, Microsoft really doesn't know anything about consumer electronics
        Actually, the XBOX still has not made any money, and probably never will because they chose to sell it at a loss. They expected to make up the difference in game sales, but that hasn't really worked out too well. This was a pretty stupid move on their part. XBOXes are NOT printers. They do not REQUIRE you to purchase supplies on a regular basis in order for it to continue to function. With a printer, you HAVE to buy cartidges when they run out, and 90% of the time, the consumer buys the cartridge made by the same company who made their printer (HP cartridges for HP printers). And furthermore, some of those printer companies also sell paper. Not everyone buys that brand, but it's out there and many do. The XBOX on the other hand, is relying on the purchase of games. Yes you do need to buy at least one game (unless one comes bundled) to use the thing, and yes most people will buy more than one game, but there is nothing forcing them to buy the games on a regular basis. When a great new game comes out, many will buy, but not everyone, and most of the games' revenue will go to the company that produced the game, NOT Microsoft.

        With marketing prowess like this, it's very unlikely that they will be able to compete with Apple.

        • They expected to make up the difference in game sales, but that hasn't really worked out too well. This was a pretty stupid move on their part. XBOXes are NOT printers. They do not REQUIRE you to purchase supplies on a regular basis in order for it to continue to function.

          I believe Sony and Nintendo both make money with that model. You may not HAVE to buy games, but when the average game has severely limited replay value, you either buy a new game or you have a doorstop that cost a few hundred dollars.

          • Re: (Score:2, Insightful)

            by MyNameIsEarl ( 917015 )
            In Nintendo's case, however, they do not sell their consoles at a loss. So they make a profit, however small, on each machine and get the licensing from the games. Sony makes money because the PS and PS2 are such big sellers. The Xbox tried to copy Sony's model but didn't do as well.

        • Re: (Score:2)

          by Glonk ( 103787 )

          Actually, the XBOX still has not made any money, and probably never will because they chose to sell it at a loss. They expected to make up the difference in game sales, but that hasn't really worked out too well. This was a pretty stupid move on their part. XBOXes are NOT printers. They do not REQUIRE you to purchase supplies on a regular basis in order for it to continue to function.

          The Xbox wasn't expected to make money, the Xbox 360 is expected to make money in the not-so-far future. Considering shrinki

    • Re: (Score:2)

      by Znork ( 31774 )
      Indeed. Emusic has the price and drm-freeness and legitimacy, but the majors are unlikely to accept those terms. Fine for people like me who refuse to have anything to do with the majors anyway; we get our music fascist-filtered for free without having to research every label.

      Then again, I wouldnt be surprised by iTunes getting 'defeated' by the labels eventually simply forcing Apple to use equivalent to WMA DRM. Live by the sword of monopoly control, die by the sword of monopoly control.
      • Conversely, emusic offers very cheap music that appeals to people who probably end up buying the most music anyway -- people who constantly seek out new music that may exist on the fringes.

        Emusic's format puts an emphasis on not just independent music, but also the connections between them. I was on the fence about emusic until I noticed how good their recommendation and connectedness was. You can easily play "6 degrees" in emusic and it makes finding music fun, which is a big plus. No other service do

  • You learn something new every day.

  • Old story, re-examined. (Score:2, Interesting)

    by ackthpt ( 218170 ) *

    * applying Windows stickers to all PCs sold, and using a keyboard with a prominent Windows key.

    Hah. One of the first things I did, after building my first PC 4 years ago, was lever off the Windows keys, which flew behind my desk and haven't been seen since. Annoying pieces of shit. Everytime I accidently hit one for Ctrl or Alt fed the need to remove these unwelcome interlopers of QWERTY keyboards.

    More than 80% of Microsoft's revenues for Windows come from corporate volume licensing and OEM copies

  • Brown (Score:5, Funny)

    by MouseR ( 3264 ) on Friday October 13, 2006 @12:07PM (#16424477) Homepage
    Enough said.
  • ...Microsoft and Apple do things differently from one another.

    In other news.. water found to be wet, fire still a hot property, and chocolate exhibits yumminess.

  • The day Microsoft... (Score:4, Funny)

    by endemoniada ( 744727 ) <`gro.adainomedne' `ta' `leinahtan'> on Friday October 13, 2006 @12:17PM (#16424671) Homepage
    ...designs an MP3-player that actually does what it's supposed to, that's when I'll buy it.

    What I don't want is an MP3-player that's DRM-infested, but doesn't even play their own, much advertised DRM format, an MP3-player with WiFi that can ONLY communicate with other MP3-players or an MP3-player with a navigational wheel that doesn't spin.

    Congratulations Microsoft, at least you reinvented the wheel! :=)
  • They earn points by following certain rules Microsoft gives them, including:
    ...
    2.never advertising PCs sold without an operating system, or with an alternative OS installed;

    How can this not be viewed as anti-competitive behavior resulting from MS monopoly? Man, that sucks for the other OS's...
  • Cost and Marketing:

    1. Cost
    Apple's BOM costs aren't meaningfully higher than any of their competitors. I'm guessing their vig to the media conglomerates is about the same. They are working on the same cost structure which means microsoft has no advantage going in. It is very likely the zune will never operate as a profitable project by itself. It may be around for a while and they will destroy all of their OEM vendors business along the way. But, legitimate business that threatens the ipod it won't ever

  • It's obvious (Score:3, Interesting)

    by kimvette ( 919543 ) on Friday October 13, 2006 @12:28PM (#16424885) Homepage Journal
    Microsoft's DRM is fascist. If they could force you to pay a separate license for each ear for listening to music in stero rather than mono, they would. Even average customers are beginning to grow wise to Microsoft, and when Vista is released and they find to run Aero they have to add RAM AND a video card, and then later upgrade their hard drive (and reinstall because they won't have ghost or dd or partimage) and oops, sorry, they just used up their last activation, time to buy again per the EULA. . . or in the case of music specifically, they just bought a new MP3 player? It won't sync, too bad, so sad, Microsoft will tell you to buy it again.

    Apple has discovered a balance between hindering blatent "piracy" and fair use which most people find tolerable, almost downright customer-friendly. If they were to offer iTunes for Linux, I just might buy music from Apple.

    However, they (Apple) still have to realize that when I buy it, I OWN it, and I have the right by law to transfer ownership of what I purchased to someone else if I damn well desire to, just as I can sell or give away a used CD I no longer want.
    • Microsoft's DRM is fascist. If they could force you to pay a separate license for each ear for listening to music in stero rather than mono, they would.

      Microsoft wants the killer feature of the Zune to be the sharing, but that sharing is severely limiting. The best thing to do would be to extend the convenient and useful type of sharing that Apple has in iTunes to the portable players. If they did that before Apple did, it might be useful.

      What I'm thinking is this: Sharing is not limited as to the

    • "However, they (Apple) still have to realize that when I buy it, I OWN it, and I have the right by law to transfer ownership of what I purchased to someone else if I damn well desire to, just as I can sell or give away a used CD I no longer want."

      And, from a technology standpoint, that's exactly what you could do: burn your iTunes purchases to CD and hand them to a friend.

  • Apple a very minor player in PC industry (Score:3, Funny)

    by krell ( 896769 ) on Friday October 13, 2006 @12:30PM (#16424925) Journal
    The article called Apple a minor player in the PC industry. Yes, I'll say 0% (Apple has yet to market a PC) is a rather small share.

    • Re: (Score:2)

      by Wm_K ( 761378 )
      PC, personal computer. Apple surely qualifies as a personal computer manufacturer. Or do you mean x86 compatible PC manufacturer? I believe they even do that too nowadays...

      • Re:Apple a very minor player in PC industry (Score:4, Insightful)

        by krell ( 896769 ) on Friday October 13, 2006 @01:07PM (#16425697) Journal
        You are using it the way few others use it. See the Apple ad campaign that compared Macs to PCs (not to "other" PCs). Check all the software that has been sold in different versions: mac version vs pc version. "Personal computer" has not been a generic term since the early 1980s when, for better or worse, IBM hijacked it. You are right, though, about the new i386 machines that do Bootcamp....which pretty much means that Apple has stepped into the PC market for the first time after all these years.

        • Re: (Score:2)

          by Sique ( 173459 )
          To claim that the company which coined the term "personal computer" back in the 70ies for their Apple ][ never actually sold a PC is somewhat ironic. To call Wintel machines PCs is a quite recent development. When IBM introduced the IBM PC, it was called "the IBM PC", and the clones from Compaq and Tandy et.al. were called "IBM compatibles". It wasn't until the early nineties that PC was a synonym for IBM compatible (but by then IBM was no longer the trendsetter in the business).

          • Re: (Score:2)

            by krell ( 896769 )
            "To claim that the company which coined the term "personal computer" back in the 70ies for their Apple ][ never actually sold a PC is somewhat ironic."

            Actually, if you look it up, the term "personal computer" was coined in the early 1960s, but was hardly used until the IBM-PC.

            "To call Wintel machines is a quite recent development"

            The term "Wintel" never quite fit: half run AMD now, and for the first few years, PCs did not even run Windows. Besides, this "recent" you refer to started in 1981: a mere

            • Re: (Score:2)

              by Sique ( 173459 )
              I happen to have still some old Computer Magazines (from 1987 to be exact), and there the names were "Macintosh" and "IBM compatibles". The term "PC" was mainly used to make a difference to the Home Computers.

              Microcomputers are a completely different thing: The VAX for instance was a microcomputer. Microcomputer used to have the size of a small fridge, and they were called this to make a difference to midrange computers and the big irons. Today the microcomputer class would be called a "server".

              The term Win

    • Well, they sell x86 Intel microcomputers, which you can buy [macmall.com] from several resellers pre-installed with Windows, so.. what were we talking about?

      By this standard they're a marginal PC manufacturers, with a market share on the scale of the Sony Vaios.

    • a little box called the Apple II. about a year or so after they made one of the most popular microprocessors in early history, a naked board with a 6502 on it. 9 years before IBM introduced their first PC.
      • "fool, Apple INVENTED the PC...a little box called the Apple II"

        I know it is a long time ago and easy to forget, but there were a lot of other companies around then. Commodore's PET came out about the same time as the Apple II. The TRS-80 came out a couple months after. There are likely other earlier models I'm probably forgetting. They were called "microcomputers" at that time. The marketing term "personal computer" was introduced a little later, but it never really caught on until the IBM-PC. Also, if
  • Just look at the adverts on that site. PackardBell recommends Windows XP, Lenovo recommends Windows XP Professional, HP recommends Windows XP Professional, Dell recommends Windows XP Professional
  • Not long ago I was hearing how Apple is going to have trouble competing with Microsoft's iPod killer...

    Next story please... How about something to do with HD-DVD vs Blu-Ray or maybe even VHS vs BetaMax!
  • Why is it on ./ that we have articles like this once a week or so, yet I've never seen a headline like "Why Apple can't complete with Microsoft for Operating System", or "Why Apple will never amount to anything in the corporate environment"?

    Apple has less OS market share than the "minor" ipod-wannabes, yet the ./ crowd still thinks Apple matters in Operating Systems. In the corporate market, Apple has basically 0% market share... so by the iPod "logic" used in this article, why should it even bother to c

  • Read with IE (Score:3, Interesting)

    by fritz1968 ( 569074 ) on Friday October 13, 2006 @01:28PM (#16425997)
    Though the article is interesting and enlightening, I could not help but notice that Firefox (1.5.0.7) did not render the page well. Some of the text from the article was underneath other text. It made the reading real annoying. On the other hand, the web page rendered well with IE.

    It's like Bizarro world... A great article exposing Microsoft limitations and/or weaknesses, but it will not render well in Firefox. Because of that, I have to rate the article a 6.5 to 7 (on a scale of one to ten). Fix the rendering so that Firefox renders the text well and then it would probably rate as a 8.5 to 9.
  • I wrote a long article about how important DRM control was to content and content distribution. I even wrote out how some of the historical events over the past 10 years has made for Microsoft's monopoly. I then correlated the DRM to future market control and the building of a greater foundation upon which they will maintain their monopoly status.

    I erased it all because some of the younger crowd probably would see it as some sort of conspiracy theory. Those that lived through the 80s and 90s working in t
  • Does someone have another link? Just "squirt" it onto a reply to this post. Thanks.
  • MARKETING!!! Microsoft won't beat Apple because of marketing. First, ZUNE? Who came up with that name? What is Microsoft's answer to iTunes Music Store? I don't know and I am not sure why I should care. Second, complexity. Wirelessly share your music but with certain restriction and depending on liscensing with the particular albumn....alright, I already have a headache. In Computer Science 101, I was told to always, "Keep it simple, STUPID!". Third, IMAGERY! The biggest consumers of music and music players
  • So when did Microsoft ever "compete" with any other company? That's not how they do business, y'know.

    Consider that they got their start as a subcontractor for IBM, and used IBM's economic clout to enforce "agreements" with retail vendors that effectively locked out other startups. That was so successful that they've never had much of a motive to "compete" in any ordinary sense of the word. They don't compete; they make deals. When they have to, they engage in classical price wars, but that's a last reso

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