Say you and a some neighbors are selling Kool aid on neighboring corners. You sell one flavor, the four of them all sell the same different flavor. That means you have a monopoly on customers who like your flavor, and the other four have to divide the market for their flavor by 4. Which market model will make a better profit? Make this even more cunning on fox's part... Your Kool aid is more popular than theirs. Not by a huge margin, but by enough to be obvious. Wouldn't it be wiser for one of your competitors to change flavors to get a larger share of a larger market, rather than fight for a small share of a smaller market?