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===Scale and rent=== | ===Scale and rent=== | ||
It could be argued, and the JC does argue, that the yen for scale in modern commerce is driven not by an aspiration for economy, much less | It could be argued, and the JC ''does'' argue, that the yen for scale in modern commerce is driven not by an aspiration for economy, much less to save a customer money, but for the opportunities it affords to extract rent. However many thousands of organisations make you the financial services sector; however many hundreds of thousands are employed, directly or indirectly servicing those organisations, there are orders of magnitude more putting their hard-earned dollars into that system in the hope of some kind of return. | ||
The point where scale becomes really exciting is where the cost of rent extraction, per dollar, is so minimal that the hosts — beg your pardon, customers — don't even notice it. Scale then becomes free money; you don't need to reduce your rate because the customers will pay it anyway. | The point where scale becomes really exciting is where the cost of rent extraction, per dollar, is so minimal that the hosts — beg your pardon, customers — don't even notice it. Scale then becomes free money; you don't need to reduce your rate because the customers will pay it anyway. | ||
This is why hedge fund managers with 5 billion AUM are happier than | This is why hedge fund managers with 5 billion AUM are happier than those with 500m. | ||
{{sa}} | {{sa}} | ||
*{{br|[finite and Infinte Games}} | |||
*[[Redundancy]] | *[[Redundancy]] | ||
*[[Scale paradox]] | *[[Scale paradox]] | ||