Can you define "market"?

If so, the government wants to hire you.

Two recent merger cases have raised the question of how markets are defined. Normally, this blog doesn't care much about the merger and acquisition part of antitrust law, and I'll admit that I know practically nothing about it. But these particular cases are of some interest to marketers.

The one that's getting the most attention this week is Whole Foods/Wild Oats. The purchase of Wild Oats by Whole Foods would combine #1 and #2 in the high-end organic food market -- if you consider that a market. If you do, then you would oppose such a merger, as the Federal Trade Commission has announced it does. Alternatively, you could describe the merger as the combination of two small supermarket chains, minnows compared to Kroger and Super Valu, and say that there's no reason for the FTC to oppose it.

The two chains have said they'll take the FTC to court:

"The FTC has failed to recognize the robust competition in the supermarket industry, which has grown more intense as competitors increase their offerings of natural, organic, and fresh products, renovate their stores and open stores with new banners and formats resembling Whole Foods Market."

Personally, although I'll reiterate that I know nothing about the law, I think I side with the stores. There is no "natural food market", there's a niche within the grocery market that these two stores have successfully exploited. But now all the big chains are jumping in, and the only way for the niche players to survive will be to combine and grow. As an example, here's the Basha's chain in Arizona announcing their entry into the niche a couple weeks ago:

Bashas' will open its first Ike's Farmers' Market grocery store this weekend in Oro Valley, company officials announced Wednesday.

Ike's Farmers Market is a new concept for the privately held, Chandler-based chain that operates Bashas' Supermarkets, AJ's Fine Foods and the Food City grocery stores.

Ike's features organic breads, an extensive offering of bulk food items such as nuts, grains and coffees, organic wines and health-oriented products including supplements and natural body care items.

Ike Basha, by the way, was one of the founders of the chain.

This is just one of dozens of entries into the category by existing supermarkets, who are either opening new stores under new names, as Basha's is doing, or vastly expanding their natural food selections (e.g., Wal-Mart).

The other case is the merger of the XM and Sirius satellite radio companies. This one raises the question of whether satellite radio is a distinct market from broadcast radio. If it is, then the only two providers are merging; if it isn't, then the merger is no big deal, because the two represent a fairly small portion of the radio market.

The thing I enjoy about this one is watching the National Association of Broadcasters twist themselves into pretzels trying to make a logical argument against the merger. The NAB is the principal opponent and has been lobbying Capitol Hill assiduously. The problem is that the NAB's actions undercut their argument: If satellite radio is not competitive with the broadcasters, then why does the NAB care?