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US Monopoly Company and US Perfect Competition Company - Essay Example

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Monopoly market structure exists where there are no other competitive companies offering the same product. Companies that exist in monopoly markets often experience no competition. They make decisions on prices of the products without considering customer needs…
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US Monopoly Company and US Perfect Competition Company
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US Monopoly Company and US Perfect Competition Company

Download file to see previous pages... The competitive market structure come into being where there are different firms competing in the market to offer the best product and services to the customers. These companies cannot make decisions without considering what other competitors are doing. When there are several companies offering similar product and services, competition will occur. In most cases, this competition is to the benefit of the customers (Mankiw 329). Market Analyses The two monopolistic companies are the National Basket Association (NBA) and the National Football League (NFL). These two companies are in contract with the best players as well as the best stadiums. It is not easy for any other company to compete with NBA and NFL in this kind of business due to the monopolistic ownership of necessary resources for basketball and football. New companies in the market will have to look for other non standard stadiums as well as little known players, who may not be of use to them economically (Tucker 137). Another way in which NBA and NFL enjoy monopoly in the market is through legal barriers. The government has given them licenses to operate the various leagues, on the contrary, telecommunications companies such as Skype and Cisco Call manager have got licenses to operate in the market. Potential competitors also have got equal opportunity in acquiring license necessary for competition. Other potential competitors to NBA may not be given licenses since there can only be one league in the US. The market in which national basketball association and national football league operates is characterized by the fact that they are he only companies in the market, they also offer unique services and products as well as the impossible entry of possible competitors due to ownership of vital resources by these companies (Tucker 211). Competing NBA and NFL will be unsustainable hence leading to monopoly. Monopoly has resulted due to the large scale of operation in which these two companies operate. They operate national leagues across the United States; competing them will depend on who is able to survive harsh economic times. Potential competitors cannot hope to provide the services provided by NBA and NFL In contrast, One perfect example of accompany in the competitive market structure is Cisco Call Manager (CCM). This company is a key member of the Cisco IP telephony network solution. CCM offers telephone services to its customers. Further, it provides all connection services to IP phones, smart phones and VoIP services. CCM faces competition from other companies such as Skype and Comcast that offer the same products and services (Sheppard 18). Cisco Call manager (CCM) experiences competition from new entrants in the market while NBA does not. New companies that offer similar services to those of Cisco Call Manager (CCM) have found their way to the market. This kind of market is where companies offer telecommunication services to customers does not pose any challenges to possible entrants. To survive in such a competitive market, companies like CCM and Skype must offer their services at low costs and ensure that their products are unique from those offered by their competitors. CCM has also been challenged by the availability of their product substitute (Sheppard 18). NBA experiences no competition from other companies while CCM experiences stiff competition from other companies like Skype since no barriers to entry in the market exist. NBA has awarded contract to the best players as well as ...Download file to see next pagesRead More
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