Elevator Oligopoly
Four companies control every elevator on earth. Once installed, switching costs make the maintenance contract nearly permanent.
Otis, Schindler, Kohn, and Thiessenkrup control 65% of the global elevator market. They aren't competing on innovation or price, they're competing on installed base. Once an elevator is built into a skyscraper, it becomes expensive to replace. The building owner will pay whatever the original manufacturer charges for maintenance and repairs. Maintenance contracts last decades. A skyscraper built in 1980 still uses the original elevator, still gets service from Otis. That contract generates $4,000 yearly per elevator. A hundred-story building has two dozen elevators, nearly $1 million in annual service revenue from a single building. The four competitors recognize this.
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