Product Definition, Product Information, and Market Power: Kodak in Perspective

the United States Supreme Court held that market power sufficient to impose an illegal tying arrangement can, at least in theory, derive from buyers' uncertainty regarding a product's costs and quality. Although commentators disagree on the implications of the Kodak decision, all seem to agree that the opinion's emphasis on product information costs is a departure from previously accepted economic analysis of antitrust law. In this Article, Mark R. Patterson argues that the Kodak decision is, in fact, economically reasonable, incorporating into antitrust law previously neglected economic teachings about the value of product information and its potential to create market power. Applying these teachings to the facts of Kodak, Professor Patterson suggests an analytical technique for measuring information-based market power, and discusses the implications of the inclusion of information costs as a part of an analysis of market power. Further, Mr. Patterson argues that Kodak is consistent with earlier Supreme Court decisions in which the Court condemned competitors' joint restrictions on market information.