Is Santa Claus in a Dominant Market Position?
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As Christmas is approaching, parents may need to select a bearer of gifts for their household. In theory, the list of “service providers” in the wintertime gift delivery market is quite broad, including for example the Slavic Father Frost, St. Nicholas, Befana, Sinterklaas, Belsnickel or even groups like The Three Kings. However, due to tradition and a massive marketing campaign the options for Finnish families are pretty much limited to this one big fellow with a long white beard, Mr. Santa Claus.
As a market giant it is safe to say that Santa Claus has exceptional market power in the service of delivering gifts during the Christmas Holidays. Afterall, all kids are talking about since the first day of December is Santa Claus. It could even be challenging to find an alternative to Santa on Christmas Eve as other notable service providers don’t offer their gift delivery services during Christmas. One could even say that Santa holds a dominant position at least in Christmas Eve deliveries.
To be in a dominant position is not in itself illegal, since such a position can be obtained for example by providing an unrivalled service. And when you are able to offer just-in-time delivery solutions to all your customers while simultaneously circling around the globe in one day, and still obtain extremely high scores in customer satisfaction surveys, the dominant status is truly deserved.
But with great power comes great responsibility. As a dominant service provider Santa has a special responsibility to ensure that its conduct does not distort competition.
For example, what if Santa Claus obligated families to hire three elves as a condition of welcoming Santa to their homes to deliver presents? Could this be a case of “tying” which could be construed as an abuse of a dominant position?
And what about the parents who order services from Santa Claus? What if Santa charges families different prices based on his personal preferences in cookie assortments and the fanciness of Christmas lights? Wouldn’t this be viewed as discriminatory conduct and applying dissimilar conditions to equivalent agreements?
And lastly, Santa requires good behavior from children, but what if they are firmly on the naughty list? In the absence of genuine competition, can Santa just refuse to deliver gifts? Generally speaking, companies have the freedom to choose with whom they want to do business with. But if a dominant service provider refuses to supply or sets unreasonable demands regarding the terms of the service, this may be considered as and a form of abuse of dominance. This means that parents have one less thing to stress about as Santa must allow a certain amount of crankiness from children.
