Words and labels again

Edward Lopez makes the point that what the FTC may see as a "market failure" (e.g., the decline of newspapers and the success of online news sources) is simply another example of creative destruction at work. But one cannot be too wary of market failure peddlers. Often they have an agenda and/or they just don't get it. It's a dynamic market, after all.

In this week's New Yorker, James Surowiecki describes how Netflix won and how Blockbuster lost. They each did their part. Netflix was inovative and Blockbuster was more like the famous dinosaur that tried to don roller skates.

Surowiecki does not call it creative destruction. Instead he refers to "category killers". "These stores killed off all the competition in a category by stocking a near-endless variety of products at prices that small retailers couldn't match." He names the usual big-box suspects.

But I have always thought that the category killers (category busters?) are those who offer a new combination of goods or services -- so that the conventional market share definitions used by anti-trust lawyers become meaningless. I can now get back rubs at the local Whole Foods.

Killing off all the local competition is the opposite. It's the kind of thing that keeps the "trust-busters" engaged.