Competitive Analysis and Business Cycles - Essay Example

However, with time several companies began manufacturing similar products. Given the high cost associated with the operations is the software market, only a few companies have managed to operate thereby developing perfect control of their respective market shares. Such companies include Apple, Android and AVG, an antivirus manufacturing company among many others. Each of these companies manufacture similar products thus competing for the market but have successfully acquired adequate market shares.

The oligopolistic market structures present the sellers with several market entry barriers key among which include the extensive competition and government policies thus resulting in very few operators. The market however does not present the sellers with any market entry barriers thus resulting in multitude of buyers for which the companies thus compete favorably (Stackelberg, Damien, Lynn and Rowland 41). Question 2: The government has supported Microsoft and the computer industry in several ways thus helping create the current oligopolistic market.

Microsoft for example is a large American multinational corporation, one that the government considers too big to die. The death of such large companies especially during financial crises often leads to numerous ripple effects that may possibly paralyze the economy of a country in its totality. To prevent such, the American government has often provided the company with several incentives during such times to ensure that it continues to operate. The incentives include tax reduction and provision of bailouts whenever the companies near collapse.

Microsoft has maintained a perfect operation over the years owing to the fact that it had monopolized the market for long implying that the company never neared a collapse thus requiring a bail out from the government. However, the government has developed specific incentive packages that best targeted the Microsoft Corporation. The government has supported the growth of Microsoft as industry and other similar companies by forming bilateral trade contracts. The government is one of the main spenders whose contribution to an economy is essential.

The government has often sought tenders from Microsoft in the form of either the purchase of some of its products or seeking its services. Such large contracts safeguard the company’s profitability thus increasing their longevity in the market. The presence of such large tenders also makes the market more lucrative to other entrepreneurs a feature that resulted in the entry of other software and equipment manufacturers. Additionally, the government of the United States of America has formulated and implemented several legislations seeking to protect intellectual properties manufactured by such companies thereby safeguarding the interests of the companies.

Microsoft, Android and Apple among others manufacture handsets and computers among other electronic devices. Additionally, they manufacture Software a unique type of product that required protection. Through the provision of patents, the government created an effective platform on which company defendant its products thus maximizing profitability. Such policies have contributed to the growth and expansion of the industry resulting in the current numerous operators. Question 3: Intellectual