Online business information hub Investopedia defines “monopoly” as a situation in which a single company or group owns all or nearly all of the market for a given type of product or service. By definition, monopoly is characterized by an absence of competition, which often results in high prices and inferior products.
Monopoly in the Philippine tobacco industry is what a Bulacan-based cigarette manufacturer is trying to subdue. Mighty Corporation, the only Filipino-owned company producing low-priced cigarettes for almost seven decades now has warned that a foreign-dominated monopoly is out to kill all remaining low-priced local cigarette brands in the market.
Mighty Corp Executive Vice President Oscar Barrientos said, “Recent moves by our competitors, particularly a multinational company, against MC indicate a calibrated campaign to bring us to our knees and push us out of the picture.” He added that Barrientos their company was accused of technical smuggling, tax evasion and all other possible crimes which he labels as malicious and baseless.
In an earlier report, Finance Secretary Cesar Purisima was earlier quoted as saying: “It is natural for Philip Morris to fight change because you want to keep your monopolistic position. But in this environment, why should we, as a country, allow a monopoly?” The biggest cigarette manufacturer in the country is Philip Morris Fortune Tobacco Corp., formed out of a merger between Philip Morris Philippines and Fortune Tobacco Corp. (PMFTC) in 2010.
PMFTC controls 94 percent of the cigarette market, making it one of the most successful monopolies in the Philippines. Barrientos said a foreign-dominated monopoly of the market was geared towards promoting mid-market brands since profit margins in the low-cost brand category were low. “They want to kill off all remaining low-cost local brands in the market by hook or by crook so that the playing field will be cleared for their expensive foreign brands,” the Mighty Corp executive lamented.
Barrientos assured the local consumers that they will fight monopoly for sure. “It’s an uphill battle, but we cannot and will not allow a foreign bully to just trample on us and any other Filipino company that it views as a threat to its campaign for market domination. As big as our competitor is, it’s a shame that it has to resort to lies and deceit,” he stressed.