The thing is, it doesn’t have to be a “ridiculous” price, it just needs to be more than what the competitor is currently paying EDIT: can sustainably pay. Imagine the cost to Apple of not being able to produce any smartphones for a year because a competitor had snatched a crucial factory—it’s probably orders of magnitude greater than the rental cost of all the land they use. And remember that the attacker only has to remove one piece of the supply chain, whereas the defender has to ensure that they maintain control over every piece of infrastructure needed.
Given this disparity, you wouldn’t even need malicious destruction, you could just snatch pieces of land from under them and wait it out.
(Re tit-for-tat, see patent wars—these things do happen!)
it just needs to be more than what the competitor is currently paying
It needs to be higher than what the competitor is willing to pay since they can always counter offer.
You could also require that a bid to take over a piece of land stands for at least a length of time equal to K * (total value of current property / bid rental price) for some K, meaning that a takeover would have to be serious before you risked doing this, as you stand to have to pay an amount of money equal to K * total value of current property if nobody outbids you.
It needs to be higher than what the competitor is willing to pay since they can always counter offer.
Agreed. My previous comment was incorrect; it should have been “it just needs to be more than what it’s sustainable for the competitor to pay”. The underlying problem is still that the cost of disruption may be far higher than the sustainable price to rent each piece of land. So if I gain a billion dollars from Apple’s supply chains being cut, then I can bid up to a billion dollars for each piece of land used in their supply chain, and the only way Apple can stop me is paying a billion dollars of rent per piece of land.
You could also require that a bid to take over a piece of land stands for at least a length of time equal to K * (total value of current property / bid rental price) for some K
How would we determine the total value of the current property?
How would we determine the total value of the current property?
I don’t mind using manual assessment for this, since:
a) the exact value doesn’t matter all that much.
b) it only needs to be done when you want to drop your bid, and the previous owner claims you haven’t owned it long enough. So in most cases it won’t be necessary.
The thing is, it doesn’t have to be a “ridiculous” price, it just needs to be more than what the competitor
is currently payingEDIT: can sustainably pay. Imagine the cost to Apple of not being able to produce any smartphones for a year because a competitor had snatched a crucial factory—it’s probably orders of magnitude greater than the rental cost of all the land they use. And remember that the attacker only has to remove one piece of the supply chain, whereas the defender has to ensure that they maintain control over every piece of infrastructure needed.Given this disparity, you wouldn’t even need malicious destruction, you could just snatch pieces of land from under them and wait it out.
(Re tit-for-tat, see patent wars—these things do happen!)
It needs to be higher than what the competitor is willing to pay since they can always counter offer.
You could also require that a bid to take over a piece of land stands for at least a length of time equal to K * (total value of current property / bid rental price) for some K, meaning that a takeover would have to be serious before you risked doing this, as you stand to have to pay an amount of money equal to K * total value of current property if nobody outbids you.
Agreed. My previous comment was incorrect; it should have been “it just needs to be more than what it’s sustainable for the competitor to pay”. The underlying problem is still that the cost of disruption may be far higher than the sustainable price to rent each piece of land. So if I gain a billion dollars from Apple’s supply chains being cut, then I can bid up to a billion dollars for each piece of land used in their supply chain, and the only way Apple can stop me is paying a billion dollars of rent per piece of land.
How would we determine the total value of the current property?
I don’t mind using manual assessment for this, since:
a) the exact value doesn’t matter all that much. b) it only needs to be done when you want to drop your bid, and the previous owner claims you haven’t owned it long enough. So in most cases it won’t be necessary.