The Conspiracy in Question:

I have heard from different sources (crazy people), that certain companies suppress better technology in favor of profits. For instance car tires and light-bulbs that last 100 times longer than current ones, for the same price. Some people even believe the multiple manufacturer collaborate on this, like a cartel.

Arguments For the Conspiracy

  • They would lose money, due to reduced replacement of; light-bulbs or tires.

Arguments Against the Conspiracy

  • It would be hugely profitable to sell the better, longer lasting; light-bulbs or tires, as it would instantly dominate the market and other brands would become inferior.

Has anyone heard this? or have any insight into how this started? or other examples?

By the way, I'm fully aware this is probably just a rumor.

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    This claim is unfalsifiable in the general case. (How would you prove it never happened?) but may be answerable in the specific case. @ChrisW just cited a good precedent question. I asked a poor example a few years ago – Oddthinking Nov 27 '14 at 3:13
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    @ChrisW Except that Free-Market Capitalism when not regulated tends to give rise to monopolies that would have a vested interest in not letting a new innovation upset their gravy train ride. – Shadur Nov 27 '14 at 6:33
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    @DVK Yes there is. Ask John D. Rockefeller about how he kept Standard Oil the monopoly until government forced him to break up. – Shadur Nov 27 '14 at 14:55
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    @DVK Maybe the Northern Securities Company ? Or going further back and looking over my own country's shadier past, such worthies as the United Dutch East Indies Company which controlled pretty much 100% of the Dutch sea trade in its heyday and habitually committed atrocities on anyone overseas that didn't agree to their trade terms... – Shadur Nov 27 '14 at 15:18
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    @DVK The big monopolies in the early 20th centuries formed explicitly because there weren't any laws to stop them from doing so. – Shadur Nov 27 '14 at 15:33

There is actually some precedence for this.

Several auto manufacturers are now producing electric cars. However, the customer experience reported anecdotally but also measurably (meta article) by Consumer Reports (original statistics) has shown that some dealerships are less than enthusiastic about actually selling them. And more to the point, they're certainly not going to go out of their way to steer you towards them. The Consumer Reports study was made by asking the dealerships straight up that the secret shopper wanted their electric model, just to see which ones would go out of their way to actively discourage or even prevent the customer from buying one. They weren't going into the shops and asking for a hatchback that was good on gas.

Currently, there are two reasons for this. The first is that in spite of their higher sticker prices, commission is actually considerably lower. This is in no small part because the manufacturers are trying to reduce their cost to compete with similar gas models. The second is that the dealerships' business model relies less on car sales and far more on selling maintenance. Unfortunately for the dealerships though, EV maintenance is little more than tire rotation and replacing windshield washer fluid.

Tesla had already forseen this problem (Elon Musk quote: "Every other electric car maker that went that route went out of business."), and ditched that sales model entirely. They have non-commissioned salespeople, and don't charge a premium for service. It's one of the reasons that Tesla sales have been exceeding Nissan Leaf sales, in spite of the fact that the base Model S is over twice as expensive. Consumer polls have shown that the customer experience at Tesla stores has been overwhelmingly more positive than other EV purchases at dealerships.

Well that's all well and good for electric cars, but what about light bulbs and tires and other consumer goods that need to be replaced on a regular basis, but probably shouldn't be?

To be honest, that's probably an issue with cost. Washing machines for example, have gotten increasingly unreliable overall for decades. However, the average cost of them has likewise gone down. The buying public has a tendency towards buying big ticket items that are cheaper because that's the one they can afford at the time, as opposed to the one that's three times the cost but will last ten times as long. Those washing machines that last a lifetime are still being sold, but they come with a price tag that's much higher, and sales of those models aren't that great. Or look at shoes (sneakers and runners in particular), and the way pretty much everyone "knows" that you have to replace them at least once a year. This didn't used to be the case at all, and shoe repair shops used to flourish by just replacing the soles of shoes. But a pair of properly repairable shoes isn't cheap, nor easy to come by. The fact of the matter is that in the marketplace, cheaper almost always wins. Expensive and more reliable can make a profit sometimes too, but the road is littered with companies that were outsold by brands that were cheaper and high volume.

  • You've shown that the market doesn't accept some more expensive/less profitable technologies, but not that they are actively suppressing/hiding the technologies that are available. – Oddthinking Nov 27 '14 at 23:12
  • I think that has a lot more to do with the conspiracy theory than the theorists would like to think, actually. – Ernie Nov 28 '14 at 17:05
  • I'm pretty sure the telephone answering machine was suppressed too. – TRiG Nov 30 '14 at 23:25

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