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Charlie Don't Surf

Public Sector Competing With Private Companies

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Just wondered what people's take was on the public sector setting up in competition (with their almost limitless purse) against existing private companies.

To make it clearer what I'm on about I'll cite my own example.

I run a series of reasonably profitable travel and tourism websites (see signature) However over the past couple of years I've noticed the Tourist Board setting up more and more specific websites and encroaching more and more into my niches. I'd even go as far as to say some of their content/structure is inspired by my own sites.

At the end of the day the Tourist Board charge people for their services (a lot more than I do). Is it really fair that they should have public money to compete with the existing quality private sector?

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that particular case is tricky - I would expect a local tourist board to offer a pretty comprehensive service promoting local tourism

however, maybe this is simply a sign they are over-resourced and seeking ways to justify an expanding budget.

I would take your case to their paymasters (local or regional councils), write to your councillors or MP, and suggest an area to save taxpayers' money, since the private sector (yourself) already provides this service without draining tax reserves.

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that particular case is tricky - I would expect a local tourist board to offer a pretty comprehensive service promoting local tourism

however, maybe this is simply a sign they are over-resourced and seeking ways to justify an expanding budget.

I would take your case to their paymasters (local or regional councils), write to your councillors or MP, and suggest an area to save taxpayers' money, since the private sector (yourself) already provides this service without draining tax reserves.

or maybe the best example AIG

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[sarcasm]

Does it matter?

The private sector does everything a million times better for a tiny fraction of the cost so surely it will have no impact on you?

[/sarcasm]

Complain about it and then see if you can't get some public-private partnership going, be set for life.

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Just wondered what people's take was on the public sector setting up in competition (with their almost limitless purse) against existing private companies.

To make it clearer what I'm on about I'll cite my own example.

I run a series of reasonably profitable travel and tourism websites (see signature) However over the past couple of years I've noticed the Tourist Board setting up more and more specific websites and encroaching more and more into my niches. I'd even go as far as to say some of their content/structure is inspired by my own sites.

At the end of the day the Tourist Board charge people for their services (a lot more than I do). Is it really fair that they should have public money to compete with the existing quality private sector?

Great websites, like the design. And the short answer is no, I don't think it's fair that public funds are syphoned off to, say, set up a competing website that charges for ads from B&Bs & the like. It would be interesting to know if they get sold off and the people in charge of them get shares, or a politically well connected person benefits from the taxpayer funded competition?

The BBC websites have been smothering at birth the efforts small time entrepreneurs for years.

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that particular case is tricky - I would expect a local tourist board to offer a pretty comprehensive service promoting local tourism

however, maybe this is simply a sign they are over-resourced and seeking ways to justify an expanding budget.

I would take your case to their paymasters (local or regional councils), write to your councillors or MP, and suggest an area to save taxpayers' money, since the private sector (yourself) already provides this service without draining tax reserves.

You have to ask who this is a service to. Apparently those people would rather pay more for the alternative which may well be subsidising other things. Are you prepared to give this chap his chance in exchange for you paying higher taxes? I thought you wanted more bang for your buck, but apparently you believe something being revenue neutral is wicked. Do you disapprove of BBC Worldwide as well... should we just give it all away for free to foreigners?

This was a lot simpler to think about before "market reforms" made everything more expensive. Problem is, the public sector is frequently required to overcharge (internally, but also externally) so as not to compete from a position of subsidy and keep the opportunity open for private competition. Its quite likely he has already had his concession on price, that was his opportunity being protected. And thus a dogmatic belief in the market actually raises costs.

Bit of a mess isn't it.

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It's the same problem with the BBC and local services, they strangle any thought of private sector competition at birth and attempt to duplicate

and then force out anything the private sector manages to keep alive.

The BBC's plan to spend £68m on a network of local video news websites has been condemned by the Newspaper Society, which said the corporation should not be given "free rein to trample over commercial rivals".

"The BBC's 60 local websites already compete head-to-head with regional newspaper websites and its expansion plans, combined with its cross-promotional power, threaten to steal away audiences and undermine the ability of publishers to pursue their own digital development strategies, which are so important to the future of local media in the UK."

Newell said that there were already more than 1,100 local commercial websites in the UK, many of which were affiliated to the country's 1,300 regional and local newspapers, with scores already providing video news.

http://www.guardian.co.uk/media/2008/jun/2...g.digitalmedia1

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Guest absolutezero
No it's not

Yes it is.

Him with the biggest capital can squash the competition.

Who has the biggest capital? Oh yes. The State...

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You have to ask who this is a service to. Apparently those people would rather pay more for the alternative which may well be subsidising other things.

nah, he's probably just more competent than the public sector, and has his own ideas.

...And thus a dogmatic belief in the market actually raises costs.

Bit of a mess isn't it.

not really messy, pretty clear, get rid of the public sector element, this is what raises costs. Private sector did something good, to quote the OP, first.

' over the past couple of years I've noticed the Tourist Board setting up more and more specific websites and encroaching more and more into my niches. '

so the public sector copied it after the fact - for what motivation I cannot tell. I would be extremely surprised if it was actually revenue neutral, if all figures were considered.

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Yes it is.

Him with the biggest capital can squash the competition.

Who has the biggest capital? Oh yes. The State...

No its not. If the activity was not profitable, which I suspect in the case of the tourist board websites, it is not, then a capitalist would stop doing that activity or qould quickly deplete their funds and become unable to compete. By your logic the state should just do everything because they are the biggest. Why on earth would you want to pay taxes to support an inefficient expensive function that was already being provided perfectly adequately by the private sector, which was actually a net contributor to taxes?

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Guest happy?
Just wondered what people's take was on the public sector setting up in competition (with their almost limitless purse) against existing private companies.

To make it clearer what I'm on about I'll cite my own example.

I run a series of reasonably profitable travel and tourism websites (see signature) However over the past couple of years I've noticed the Tourist Board setting up more and more specific websites and encroaching more and more into my niches. I'd even go as far as to say some of their content/structure is inspired by my own sites.

At the end of the day the Tourist Board charge people for their services (a lot more than I do). Is it really fair that they should have public money to compete with the existing quality private sector?

The thing is there's no copyright on general ideas. I thought of this idea long before you did but couldn't be bothered to put it into action....

More importantly, being first is no guarantee of success in business. I can think of numerous examples where inferior products have become the de facto standard because their owners were able to dominate - even where that supplier was late to the market (e.g. Internet Explorer).

I.E is an inferior product in many ways and prior to version 5 was a public joke - Microsoft ignored the internet for a decade - yet they now dominate website design - ignoring W3C standards.

Another view might be that you encroached on the role of the tourist boards - they published local information about their area for decades you simply moved into a new medium in the hope of turning a pretty penny, they've now reclaimed their territory.

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Guest absolutezero
No its not. If the activity was not profitable, which I suspect in the case of the tourist board websites, it is not, then a capitalist would stop doing that activity or qould quickly deplete their funds and become unable to compete. By your logic the state should just do everything because they are the biggest. Why on earth would you want to pay taxes to support an inefficient expensive function that was already being provided perfectly adequately by the private sector, which was actually a net contributor to taxes?

Your suspicion would be wrong, as the opening poster says it is profitable.

My logic doesn't say the state SHOULD do anything.

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Your suspicion would be wrong, as the opening poster says it is profitable.

My logic doesn't say the state SHOULD do anything.

Are you actually replying to my post? Doesn't look like it from what you say here.

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The state has increasingly competed with the private sector since the late 1980s.

In consultancy for example: Business Link e.g. and various other government initiatives.

County Councils set up common supply and procurement units: and these now supply non-public sector enterprises.

The list is endless.

As with any business, analysing the competition is an essential aspect of pre-launch planning: and a constant dynamic as businesses should seek to create and maintain Competitive Advantage.

Which is why product offering needs ongoing and permanent review.

Really successful businesses tend to be those which indentify passing opportunity and jump on it: and keep on doing precisely that.

More than ever today a business cannot be static: such complacency leads to competitors stealing your market share.

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Guest absolutezero
Are you actually replying to my post? Doesn't look like it from what you say here.

Given I quoted you and then addressed a couple of your points, I would say I was replying to you.

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Given I quoted you and then addressed a couple of your points, I would say I was replying to you.

Well, you misread my post and posted something suggesting you had proved me wrong.

Then you did your best to avoid the topic under discussion, conveniently failing to really answer anything.

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The state has increasingly competed with the private sector since the late 1980s.

In consultancy for example: Business Link e.g. and various other government initiatives.

County Councils set up common supply and procurement units: and these now supply non-public sector enterprises.

The list is endless.

As with any business, analysing the competition is an essential aspect of pre-launch planning: and a constant dynamic as businesses should seek to create and maintain Competitive Advantage.

Which is why product offering needs ongoing and permanent review.

Really successful businesses tend to be those which indentify passing opportunity and jump on it: and keep on doing precisely that.

More than ever today a business cannot be static: such complacency leads to competitors stealing your market share.

Nothing of what you say is wrong, but just because a business should keep an eye on the competition, does not make an argument for or agianst state competition with private enterprise. My opinion is that if something is being done perfectly well by the private sector, its madness to spend taxpayers money setting up in competition.

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Guest absolutezero
Well, you misread my post and posted something suggesting you had proved me wrong.

Then you did your best to avoid the topic under discussion, conveniently failing to really answer anything.

So to sum up, you don't actually know what you're on about.

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So to sum up, you don't actually know what you're on about.

Plonker, you did not read the post or respond to the points and have the cheek to tell me I don't know what I'm on about.

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Yes it is.

Him with the biggest capital can squash the competition.

Who has the biggest capital? Oh yes. The State...

The state has no capital

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Just wondered what people's take was on the public sector setting up in competition (with their almost limitless purse) against existing private companies.

To make it clearer what I'm on about I'll cite my own example.

I run a series of reasonably profitable travel and tourism websites (see signature) However over the past couple of years I've noticed the Tourist Board setting up more and more specific websites and encroaching more and more into my niches. I'd even go as far as to say some of their content/structure is inspired by my own sites.

At the end of the day the Tourist Board charge people for their services (a lot more than I do). Is it really fair that they should have public money to compete with the existing quality private sector?

State companies competing with the private sector is not a bad thing so long as that state company is self funding. But if that were the case, they probably won’t be a state company.

The biggest easy example is the BBC.

It competes with a relatively limitless purse vs real commercial businesses trying to make a fair buck.

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Nothing of what you say is wrong, but just because a business should keep an eye on the competition, does not make an argument for or agianst state competition with private enterprise. My opinion is that if something is being done perfectly well by the private sector, its madness to spend taxpayers money setting up in competition.

Couldn't agree more.

Unfortunately, much of this is the result of Thatcherist "Market" competition within the state sector itself.

Such as the NHS were forced to "Compete" with the private sector on the theory that this would lead to greater effeciency.

Unfortunately, what it lead to under NuLab was vast outsourcing as the bureaucracy was hugely expanded: and fortunes for various NuLab luvvies such as the ex-civil servant who founded Capita: and on the back of vast contracts gave NuLab many millions............................

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