Mergers, acquisitions and partnership agreements have become increasingly common in business. There have been many of late such as AT&T-Time Warner, CVS-Aetna, Express Scripts-Cigna and T Mobile- Sprint. This raises the specter of collaboration, yet there is a fear within the US Department of Justice (DoJ), that this could thwart the true spirit of competition, essential to a healthy business environment. Occasionally the DOJ can actually knock-down some proposed mergers when affects the customer base substantially. However, a lot of mergers take place due to other reasons and not just to kill competition. In fact, competition itself is a varied term. Five kinds have been identified, starting with horizontal competition which is naturally one where two or more compete within the same industry. Conversely, vertical is that where companies are in competition either with their suppliers upstream or buyers downstream, mainly over profit margins. Disruptive competition is one where any business innovation moves in to the market, threatening to deplete or eliminate legacy firms. State-sponsored competition is very common in China. Here, companies are backed by a central government, often for welfare purposes. Collective competition is increasing its presence but has always been around. It is when several players collaborate simply to fight an existing giant head-on. These collaborators do not have much in common except a common enemy, such as Apple is for the Android camp. Source:

Uploaded Date:22 June 2018

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