In an economy, vendor locking , also known as locking ownership or locking subscribers , rendering customers dependent on vendors for products and services, unable to use vendors others without substantial switching costs. Locking costs that create barriers to market entry can result in antitrust action against monopoly.
Video Vendor lock-in
Contoh
Microsoft
The European Commission, in its decision on 24 March 2004 on Microsoft business practices, quotes, in paragraph 463, the general manager of Microsoft for the development of Aaron Contorer C as stated in the internal Microsoft Memo 21 February 1997 compiled for Bill Gates: "The Windows API is so widespread, so deep, and so functional that most ISVs will be crazy about not using it, and it's deeply embedded in the source code of many Windows applications that there is a huge switching fee for using different operating systems.This is the switching cost that has given customers the patience to stick with Windows through all our mistakes, our buggy drivers, our high TCO, the lack of sexy vision at the time, and many other difficulties. [...] Customers are constantly evaluating other desktop platforms, [but] will be very much job to move that they hope we just improve Windows rather than force mer eka to move. In short, without this exclusive franchise called Windows API, we will die ti me ago. The Windows franchise is driven by application development that focuses on our core API "
Microsoft application software also shows locking through the use of proprietary file formats. Microsoft Outlook uses a datastore format with no document of its own and is not documented. The current version of Microsoft Word has introduced a new MS-OOXML format. This can make it easier for competitors to write documents compatible with Microsoft Office in the future by reducing locking. Microsoft released a full description of the file format for older versions of Word, Excel and PowerPoint in February 2008.
Apple Inc.
Prior to March 2009, digital music files with digital rights management were available for purchase from the iTunes Store, encoded in a proprietary derivative of AAC format using Apple's FairPlay DRM system. These files are only compatible with Apple iTunes media player software on Mac and Windows, iPod portable digital music players, iPhone smartphones, iPad tablet computers, and Motorola ROKR E1 and SLVR mobile phones. As a result, the music is locked in this ecosystem and is available for portable use only through the purchase of any of the above devices, or by burning to a CD and optionally tearing back to DRM-free format such as MP3 or WAV.
In January 2005, an iPod buyer named Thomas Slattery filed a lawsuit against Apple for the "illegal bundling" of the iTunes Music Store and their iPod device. He states in a nutshell: "Apple has turned an open and interactive standard into an intelligence that prevents consumers from using their portable hard drive digital music player." By the time Apple was found to have 80% of the market share of digital music sales and 90% of the market share of new music players, it claims to allow Apple to horizontally capitalize on its dominant position in both markets to lock consumers into their complementary offerings.. In September 2005, US District Judge James Ware agreed to Slattery v. Apple Computer Inc. to process a monopoly charge against Apple in violation of the Sherman Anti-Semitic Act.
On June 7, 2006, the Norwegian Consumer Council declared that Apple's iTunes Music Store violated Norwegian law. The contract conditions are unclear and "clearly unbalanced to dislike customers". Retroactive changes to DRM conditions and nonconformities with other music players are the main points of concern. In an earlier letter to Apple, BjÃÆ'¸rn consumer ombudsman Erik Thon complained that the iTunes DRM mechanism is key for Apple's music players, and argues that this is a conflict with consumer rights that he doubts will be retained by Norwegian copyright laws.
On May 29, 2007, the tracks on the EMI label became available in a DRM-free format called iTunes Plus. These files are not protected and encoded in AAC format at 256 kilobits per second, twice the bitrate of the standard tracks purchased through the service. The iTunes account can be set to display a standard or iTunes Plus format for tracks where both formats exist. These files can be used with all players that support AAC file format and are not locked onto Apple hardware. They can be converted to MP3 format if desired.
On January 6, 2009, the four major music studios (Warner Bros, Sony BMG, Universal, and EMI) have signed up to remove DRM from their tracks, at no additional cost. However, Apple requires consumers to previously buy DRM music restrictions removed.
While Google has declared its position to support interoperability, the company has taken steps from open protocols to replace the open Google Talk standard with the Google Hangouts proprietary protocol. In addition, the Google Data Liberation Front has been inactive on Twitter since 2013 and its official website www.dataliberation.org now redirects to a page in the Google FAQ, which directs users to believe the project has been closed.
Another example
- Many printer manufacturers claim that if any ink cartridges, other than self-sold, are used in the printer, the printer warranty becomes void. Lexmark goes a step further, creating an ink cartridge that contains an authentication system, whose purpose is to make it illegal in the United States (under the DMCA) for competitors to create compatible ink cartridges with Lexmark printers.
- The test strips for glucose meters are usually made for a specific brand or model. Strips designed for Accu-chek devices, for example, are not compatible with meters from other manufacturers. Lack of standardization can cause problems especially in developing countries, where glucose meters and associated strips are scarce commodities. Some companies, though claiming to have a lifetime warranty on their products, stop making certain models and chips each so that even those who have models are functioning well, have to buy a new model.
- The one-serving coffee capsule system of K-Cup is covered by a patent owned by Keurig, a subsidiary of Green Mountain Coffee Roasters, and no other manufacturer can make K-Cup compatible with Keurig coffee makers without license from Keurig. While the company has patents on system improvements, the original K-Cup patent expires in September 2012. Other single-serve coffee brands, such as Nespresso, also have proprietary systems.
- The camera mounts of competitor camera manufacturers are almost always incompatible. Therefore, a photographer with a set of lens mounts from a particular manufacturer will choose not to purchase cameras from other manufacturers.
- Nvidia, in 2018 still only supports Nvidia G-Sync exclusively despite standard open Video Adaptive Sync (FreeSync) standards for Electronic Video Standards (VESA).
Maps Vendor lock-in
Variations
- Monopolistic
- Does a single vendor control the market for methods or technologies that are locked into. Differentiate between locked in technology alone, or vendor-specific.
This lock-in class is potentially very difficult to overcome if the monopoly is blocked by impenetrable market barriers, such as patents, confidentiality, cryptography or other technical hurdles.
- Collective
- Are individuals locked collectively, partly through each other. Economically, there is a cost of to reject the local dominant choice, as if by friction between individuals. In the mathematical model of differential equations, regardless of individual discretion, this is a distributed parameter system in market share, which can be used for modeling with partial differential equations, for example the heat equation.
This lock-in class is potentially unavoidable by rationally unmotivated individuals, by creating a prisoner's dilemma - if the cost to refuse is greater than the cost of joining, then the optimal local choice is to join - a barrier that requires cooperation to overcome. The distributive property (the cost of rejecting local dominant choices) is not a network effect, due to the lack of positive feedback, but the addition of individual bistability, as with switching costs, qualifies as a network effect, by distributing this instability to the collective as a whole.
Locking technology
As defined by The Independent, this is a type of lock-in non-monopoly (technology only), collectively (at the community level):
Locking technology is the idea that the more people adopt a particular technology, the less likely users are to switch.
Example:
- The prevalence of QWERTY keyboard layouts that are constantly being said to be caused by locking technology.
- Carbon locking is the theory that people are becoming dependent on carbon-intensive technology, hindering commercialization of renewable energy.
- Changing one lossy file format to another creates a loss of quality generation. This applies to switching costs. Therefore, if the valuable content is encoded in the format, this creates the need for continued compatibility with it.
Personal technology add-on
The key-in technology, as defined, is strictly of the collective type. However, personal variants are also likely to permutate the variations shown in the table, but without monopoly and no collectivity, is expected to be the weakest key. Personal equivalent example:
- Someone who has advanced on a QWERTY keyboard will have an incentive to continue using the QWERTY keyboard.
- A car owner has an incentive to use their car, because using a car is a bargain compared to the total cost of car ownership; The car was said to be a charred charge.
- Someone who has ripped their CD collection to MP3 will have the urge to choose audio equipment that supports this format; and vice versa, for reasons of personal investment, has an incentive to continue to tear into this format.
- A person who has most of their multimedia equipment connected to HDMI will tend to look for HDMI compatibility to all their other multimedia-capable equipment (although this is a much worse lock-in case than the one above, since the wide availability of the adapter which can be used to connect HDMI equipment to/from - for example - DVI or DisplayPort equipment).
Locking collective vendors
There is a locked situation that is monopolistic and collective. Having the worst of both worlds, it can be very difficult to escape - in many instances, the cost of resisting creates some degree of isolation from (socially dominating technology in) society, which can be socially costly, but the direct competition with the vendor's dominant is hindered by compatibility.
As one blogger puts it:
If I stop using Skype, I will lose contact with many people, because it is not possible to get them all changed to [other] software .
While MP3 is now patent-free, in 2001 it was patented and deeply rooted, as noted by Richard Stallman that year (in justifying the liberal license for Ogg Vorbis):
there is (...) the danger that people will stay in MP3 format even though it is patented, and we will not be * allowed * to write free encoders for the most popular formats. (...) Usually, if someone decides not to use a copyleft program because the license is not fun, it does not belong to us. But if he rejects Ogg/Vorbis code for licensing, and using MP3s instead, then the issue lies behind us - because continuous MP3 usage can help MP3 to become and stay rooted.
Source of the article : Wikipedia
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