{"id":624000,"date":"2024-06-13T00:00:00","date_gmt":"2024-06-13T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/2024\/06\/13\/pianos-motorcycles-and-robots-how-jack-of-all-trades-companies-mastered-diversification-and-market-manipulation\/"},"modified":"2024-06-13T00:00:00","modified_gmt":"2024-06-13T00:00:00","slug":"pianos-motorcycles-and-robots-how-jack-of-all-trades-companies-mastered-diversification-and-market-manipulation","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/egypt\/2024\/06\/13\/pianos-motorcycles-and-robots-how-jack-of-all-trades-companies-mastered-diversification-and-market-manipulation\/","title":{"rendered":"Pianos, motorcycles, and robots: How jack-of-all-trades companies mastered diversification (and market manipulation)"},"content":{"rendered":"<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"> <strong>In a global market that demands perpetual growth,<\/strong> companies once content with a single product or service are increasingly spreading their wings to venture into seemingly unrelated territories. The onboarding of different products or acquiring companies with separate offerings can be a strategic gameplan for diversification, but it can sometimes pave the way for market manipulation.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>A famous example of successful pivoting is <\/strong><strong><a target=\"_blank\" href=\"https:\/\/www.nintendo.co.jp\/corporate\/en\/history\/index.html\" style=\"\" rel=\"noopener\">Nintendo<\/a><\/strong>, which started out as a playing card company in 1889. Their progression into the video game giant we know now after 88 years of operation wasn\u2019t borne out of desperation \u2014 Nintendo was, up until the launch of their first home video game consoles in 1977, a very successful playing card company.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>But the undisputed monarch of diversification is Yamaha.<\/strong> Their development began when <a target=\"_blank\" href=\"https:\/\/www.yamaha.com\/en\/about\/history\/\" style=\"\" rel=\"noopener\">Yamaha<\/a>, founded just two years before Nintendo, forayed into furniture in 1903 thanks to the expertise of their carpenters, who had up until then been manufacturing reed organs and pianos. After being asked to produce <a target=\"_blank\" href=\"https:\/\/www.yamaha.com\/en\/about\/experience\/innovation-road\/collection\/detail\/0002\/\" style=\"\" rel=\"noopener\">wooden aircraft propellers<\/a> by the government during the interwar period in 1921, Yamaha used the production techniques they acquired as the first building block to motorcycle manufacturing.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>One thing led to another. <\/strong>The leap from motorcycles to snowmobiles was lateral, and that led to the development of ship engines, which naturally preceded a whole boat. Pools were then built to test the boats, and so started the pool business. In the process of developing a filtration system for the pool, a malfunctioning filter full of algae spurred the biotechnology research branch of the company. As a tribute to their musical roots, the rest of the orchestra joined the lineup, and electric guitars led to amplifiers and microphones and research in digital signal processing.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Standard operation expansion is rarely as organic.<\/strong> More contemporary companies often opt to expand to industries they know are proven winners. And so these companies go to war \u2014 literally. <a target=\"_blank\" href=\"https:\/\/www.honeywellhome.com\/us\/en\/products\/security\/security-systems\/\" style=\"\" rel=\"noopener\">Honeywell<\/a>, the home security company, also produces <a target=\"_blank\" href=\"https:\/\/aerospace.honeywell.com\/us\/en\/products-and-services\/by-catalog\/standard-equipment\/actuation\/missile-actuation?utm_source=google&utm_medium=cpc&utm_campaign=23-aero-ww-dsa-products&utm_content=dyn-en-lp&gad_source=1&gclid=Cj0KCQjwpZWzBhC0ARIsACvjWROj0YnxTFO2MVBK30Jm2azkh8UUO0jiLyX2vF6I4unWWznMMzh_9i4aAleFEALw_wcB\" style=\"\" rel=\"noopener\">missile guidance systems<\/a>. In fact, they were the ones to build the <a target=\"_blank\" href=\"https:\/\/aerospace.honeywell.com\/us\/en\/products-and-services\/product\/hardware-and-systems\/cockpit-systems-and-displays\/flight-controls-and-autopilots\" style=\"\" rel=\"noopener\">autopilot system<\/a> that was used to <a target=\"_blank\" href=\"https:\/\/www.si.edu\/object\/north-american-f-100d-super-sabre%3Anasm_A19781577000\" style=\"\" rel=\"noopener\">drop the nuclear bomb<\/a> on Hiroshima. <a target=\"_blank\" href=\"https:\/\/www.singer.com\/\" style=\"\" rel=\"noopener\">Singer<\/a> are known for their <a target=\"_blank\" href=\"https:\/\/typewriterdatabase.com\/royal.617.typewriter-serial-number-database\" style=\"\" rel=\"noopener\">typewriters<\/a> and sewing machines\u2026 and also <a target=\"_blank\" href=\"https:\/\/www.popularmechanics.com\/military\/weapons\/a23340620\/singer-sewing-machine-company-45-pistol-gun\/\" style=\"\" rel=\"noopener\">guns<\/a>. <a target=\"_blank\" href=\"https:\/\/www.ti.com\/\" style=\"\" rel=\"noopener\">Texas Instruments<\/a>, whose <a target=\"_blank\" href=\"https:\/\/education.ti.com\/en\/products\" style=\"\" rel=\"noopener\">calculators<\/a> tortured most of us, manufacture <a target=\"_blank\" href=\"https:\/\/armourersbench.com\/tag\/texas-instruments-javelin\/\" style=\"\" rel=\"noopener\">rocket launchers<\/a> and other large weapons for the US military.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Acquisition kings: <\/strong>Other companies pivot through acquisitions. Leaving their core brand intact, these companies grow into consumer goods giants by owning a vast portfolio of brands. <a target=\"_blank\" href=\"https:\/\/us.pg.com\/\" style=\"\" rel=\"noopener\">Procter & Gamble<\/a> and <a target=\"_blank\" href=\"https:\/\/www.unilever.com\/\" style=\"\" rel=\"noopener\">Unilever<\/a> are prime examples. Both of these companies\u2019 lists of acquired brands are so long that they need their own Wikipedia pages.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>This isn\u2019t a simple matter of multiple offerings.<\/strong> Some companies, like General Motors and Volkswagen, own multiple brands at different price points and\/or with different specifications. On the other hand, many of the competing brands we\u2019re familiar with (and maybe biased towards) are <a target=\"_blank\" href=\"https:\/\/blog.cheapism.com\/brands-owned-by-same-company\/\" style=\"\" rel=\"noopener\">owned by the same company<\/a>. Having multiple products targeted at the same audience enables a company to benefit no matter which route the consumer takes, giving them the <a target=\"_blank\" href=\"https:\/\/uniquebusinessmodels.substack.com\/p\/18-the-illusion-of-choice-business\" style=\"\" rel=\"noopener\">illusion of choice<\/a>.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Who\u2019s to tell when diversification becomes market manipulation?<\/strong> Lawmakers say it\u2019s all about intent. A company\u2019s intent may allegedly be to increase market share or control a larger portion of the market, but it usually leads to artificially inflating prices. Since consumers rely on their products and don\u2019t have any other options, competitive prices are no longer a concern.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Turns out there is such a thing as putting your eggs in too many baskets. <\/strong>While acquisition isn\u2019t inherently manipulative<strong>, <\/strong>large-scale acquisitions can affect the market in the same way as intentional manipulation. When a company buys up its most significant competitors, the reduced competition can lead to higher prices for consumers because there are fewer options available. If a company monopolizes too much of the market, it becomes subject to antitrust laws for stifling competition.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>This not only applies to consumer goods but also to media and technology.<\/strong> There are currently antitrust cases filed against <a target=\"_blank\" href=\"https:\/\/www.nytimes.com\/2024\/05\/03\/technology\/google-apple-amazon-meta-antitrust.html\" style=\"\" rel=\"noopener\">Google<\/a>, <a target=\"_blank\" href=\"https:\/\/variety.com\/2020\/digital\/news\/ftc-states-sue-facebook-monopoly-divest-instagram-whatsapp-1234849764\/\" style=\"\" rel=\"noopener\">Meta<\/a>, <a target=\"_blank\" href=\"https:\/\/www.ftc.gov\/news-events\/news\/press-releases\/2023\/09\/ftc-sues-amazon-illegally-maintaining-monopoly-power\" style=\"\" rel=\"noopener\">Amazon<\/a>, and <a target=\"_blank\" href=\"https:\/\/apnews.com\/article\/apple-antitrust-monopoly-app-store-justice-department-822d7e8f5cf53a2636795fcc33ee1fc3\" style=\"\" rel=\"noopener\">Apple<\/a> for monopolistic behavior, based on the Federal Trade Commission\u2019s (FTC) <a target=\"_blank\" href=\"https:\/\/www.ftc.gov\/enforcement\/anticompetitive-practices\" style=\"\" rel=\"noopener\">distinction<\/a> between healthy diversification and anti-competitive market practices. The FTC has sued all four companies \u2014 twice in Google\u2019s case \u2014 for employing anticompetitive and illegal strategies to maintain their monopolies.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>  <\/strong><\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>Market manipulation masters:<\/strong> Google is being accused of internet search monopoly, acquiring rivals through anticompetitive mergers, and bullying publishers and advertisers into using the company\u2019s ad technology. The FTC, <a target=\"_blank\" href=\"https:\/\/www.nytimes.com\/2023\/09\/26\/technology\/ftc-amazon.html\" style=\"\" rel=\"noopener\">alongside 17 states<\/a>, sued Amazon for overcharging sellers using their marketplace and manufacturing artificially higher prices. Apple was sued for blocking competition in the cloud, messaging, and digital wallet market, inflating prices, and restricting how third-party products interact with Apple products after a two-year investigation corroborated by <a target=\"_blank\" href=\"https:\/\/time.com\/6959254\/doj-apple-antitrust-lawsuit-monopoly-iphone\/\" style=\"\" rel=\"noopener\">16 states<\/a>. Meta was taken to the courtrooms by the FTC and <a target=\"_blank\" href=\"https:\/\/variety.com\/2020\/digital\/news\/ftc-states-sue-facebook-monopoly-divest-instagram-whatsapp-1234849764\/\" style=\"\" rel=\"noopener\">40 states<\/a> for monopolizing the social media industry by <a target=\"_blank\" href=\"https:\/\/www.nytimes.com\/2020\/12\/09\/technology\/facebook-antitrust-monopoly.html?action=click&pgtype=Article&state=default&module=styln-big-tech&variant=show&region=MAIN_CONTENT_1&block=storyline_levelup_swipe_recirc\" style=\"\" rel=\"noopener\">depriving<\/a> consumers of platforms unassociated with the company by buying out Instagram and WhatsApp.<\/p>\n<p style=\"padding:0;margin:0;line-height:1.15;orphans:2;widows:2;text-align:left\"><strong>These lawsuits aren\u2019t punishment for too much growth<\/strong> \u2014 the FTC alleges that instead of improving their products and services for a larger market share and better consumer experiences, these companies have been acting to push out smaller players and prevent their advancement in the space, cementing their monopolies in the name of diversification. All four companies have denied the FTC\u2019s claims and are fighting back, citing lawful intent.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Companies once content with a single product or service are increasingly spreading their wings to venture into seemingly unrelated territories<\/p>\n","protected":false},"author":1,"featured_media":624001,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-feature.php","format":"standard","meta":{"_acf_changed":false,"newspack_ads_suppress_ads":false,"newspack_popups_has_disabled_popups":false,"newspack_sponsor_sponsorship_scope":"","newspack_sponsor_native_byline_display":"inherit","newspack_sponsor_native_category_display":"inherit","newspack_sponsor_underwriter_style":"inherit","newspack_sponsor_underwriter_placement":"inherit","ep_exclude_from_search":false,"_primary_brand":0,"newspack_featured_image_position":"","newspack_post_subtitle":"","newspack_article_summary_title":"Overview:","newspack_article_summary":"","newspack_hide_updated_date":false,"newspack_show_updated_date":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8652],"tags":[8651,633,134],"brand":[],"newspack_spnsrs_tax":[],"class_list":["post-624000","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-business","tag-enterprisepm","tag-ever-given","wpautop","entry"],"acf":{"mongo_id":"544a3836-5dca-4274-a7f4-90ea55abc8cf","order":"11","is_powered_by":false,"story_type":"1","photo_url":"https:\/\/ent.news\/2024\/6\/735.jpg","photo_position":"above","homepage_title":"","full_issue_title":"","related_issue":[623985],"teaser":"Companies once content with a single product or service are increasingly spreading their wings to venture into seemingly unrelated territories","voice_url":"https:\/\/s3.us-east-1.amazonaws.com\/ent.news\/audio\/2024\/6\/.70e756fd-d0d5-487d-9989-adb0afc7c764.mp3"},"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.1 (Yoast SEO v27.1.1) - 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The green bond issuance will be used to finance renewable energy projects and could be cross-listed on the EGX\u2026","rel":"","context":"In &quot;DEBT WATCH&quot;","block_context":{"text":"DEBT WATCH","link":"https:\/\/enterpriseam.com\/egypt\/category\/debt-watch\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/ent.news\/2022\/1\/206.jpg?fit=%2C&ssl=1&resize=350%2C200","width":350,"height":200},"classes":[]},{"id":577768,"url":"https:\/\/enterpriseam.com\/egypt\/2022\/12\/05\/we-could-see-the-first-tranche-of-our-imf-loan-before-the-new-year-says-maait\/","url_meta":{"origin":624000,"position":1},"title":"We could see the first tranche of our IMF loan before the new year, says Maait","author":"enterpriseam admin","date":"5 December 2022","format":false,"excerpt":"Could we see the first chunk of our IMF loan as soon as this month? 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