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Sharing information, follow up

On Sept 15 I asked whether information sharing between the New York Times and the Washington Post constituted a possible violation of antitrust law. Prof. Shubha Ghosh, of AntitrustProf Blog, responded by writing, “It is not clear how this activity, as described, would have adversely affected competition and market price. My guess is that the practice was a way of assuring some degree of diversity in news reporting and to ensure that one paper did not look too much like the other.” Yet I interpreted the activity’s purpose much differently. Based upon a couple examples cited within the article, the purpose was a “curtesy” to ensure that the other paper did not miss out on a big, substantial story.

Therefore the two newspapers – who in their own admission are direct competitors – have a horizontal agreement fixing output in some respects. Imagine two cereal companies getting together to discuss the ingredients each of them uses in an effort to make sure one’s product isn’t too superior to the other. This may not constitute a violation, but taken to an extreme it very well could.

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