There are many kinds of businesses that exploit faults in the public and market, yet don't even have any relationship with branding. Companies have better resources and access to more information about the areas they function in than the public does (whether as individuals or groups), and many businesses don't market to the public at all, even if they deal with the public. Debt collection firms, for example, have all of these features.
The public does have a mechanism to counteract the actions of companies, and that's representative government and regulation. It's obviously imperfect, but it is the mechanism the public has.
So why can't consumers get e.g. cheaper text message rates?
I'm not sure I buy the whole "truly free markets will save us all" argument, but the particular text-messaging argument has a very simple explanation in terms of government monopolies and the cozy relationship between entrenched players and the government.
http://en.wikipedia.org/wiki/Tragedy_of_the_commons#Modern_s...
> municipalities control where you can build cell towers
Substitution sometimes works just as well as attacking any one product's pricing model.
And the other reply is right. The space is incredibly regulated. You'd be arrested for trying to compete in the restricted spectrum.
Hominem ūnīus librī timeō.
Most business take pride in what they make. Most people look for that, and look for recommendations from peers. That system is remarkably effective.
By the 1930s, muckraking journalists, consumer protection organizations, and federal regulators began mounting a campaign for stronger regulatory authority by publicizing a list of injurious products which had been ruled permissible under the 1906 law, including radioactive beverages, cosmetics which caused blindness, and worthless "cures" for diabetes and tuberculosis. The resulting proposed law was unable to get through the Congress of the United States for five years, but was rapidly enacted into law following the public outcry over the 1937 Elixir Sulfanilamide tragedy, in which over 100 people died after using a drug formulated with a toxic, untested solvent. The only way that the FDA could even seize the product was due to a misbranding problem: an "Elixir" was defined as a medication dissolved in ethanol, not the diethylene glycol used in the Elixir Sulfanilamide.
http://www.calcompnutrition.com/natural-cures-kevin-trudeau....
Many real elixirs are killing people right now, by not getting on the market fast enough to save lives because of the lengthy FDA approval process. You don't hear about that.
I would start by emphasizing that things that can kill lots of people should be regulated. Cars and planes and buildings fall in that category. But how?
An airline should be forced to get insurance for the risk of bad pilots. That might be enough to align incentives and protect people from risk. It is a slightly irrelevant issue as laws will be passed within our lifetimes that mandate a human must _not_ fly a commercial airplane. Only robots.
Driving is similar, but much easier, so more people can do it. It's harder from a robotics front, but will also be solved soon. I've worked on robot cars.
Heart surgery is where it gets interesting. By mandating a certain level of quality, you essentially place a price floor above the market price on medical care. That means a lot of people don't get it. Would you rather have a shoddy operation or none at all? As desperate times often demonstrate (e.g. delivering a baby outside a hospital by necessity), people want shoddy care over none at all.
So licensing doctors is bad. Private accreditation is enough. I will trust a doctor that has received a credential or accreditation from an institution I trust. I certainly trust Harvard more than I trust the AMA or HHS.
You should read Capitalism and Freedom by the way. Milton Friedman is an excellent author. He makes this issue crystal clear.
Regulations are just there to try and avoid the transition period of pain (and death).
Sounds remarkably similar to where we are.
For the examples you site about companies too big to fail: firstly no company is too big to fail. Secondly, those industries would be more competitive without regulation, subsidies, the SEC, and the FCC.
Finally, it makes your whole comment hold less weight when you single out Rupert Murdoch while commenting on an open forum on the internet. Communication and broadcasting tools have never been more competitive and free.