In the case of VISA, they have to be very careful when it comes to anti-trust issues. It already cost them six billion dollars last time around.
The last thing VISA wants to do, is take over the entire payment system. That's why they're not really attempting to compete with Square or PayPal. They could trivially buy someone like Square.
VISA's golden goose is exactly where they're sitting today: no serious anti-trust burden, massive margins, low overhead brand-based business model. The minute they start trying to own everything, the goose gets shot. Today they do $5.4b in profit on just $12.7b in sales - what can a very modest business like Square offer them on top of their massive 42% net income margins to offset the anti-trust scrutiny they'd be taking on? Absolutely nothing.
If VISA tries to take over the payment processor space, Discover and Mastercard will immediately go in for the kill on anti-trust.
The last thing VISA wants to do, is take over the entire payment system. That's why they're not really attempting to compete with Square or PayPal. They could trivially buy someone like Square.
VISA's golden goose is exactly where they're sitting today: no serious anti-trust burden, massive margins, low overhead brand-based business model. The minute they start trying to own everything, the goose gets shot. Today they do $5.4b in profit on just $12.7b in sales - what can a very modest business like Square offer them on top of their massive 42% net income margins to offset the anti-trust scrutiny they'd be taking on? Absolutely nothing.
If VISA tries to take over the payment processor space, Discover and Mastercard will immediately go in for the kill on anti-trust.