Draft Market Definition Analysis Memorandum

---
name: draft-market-definition-analysis-memorandum
task_id: antitrust-competition/draft-market-definition-analysis-memorandum
description: Closes gaps in narrow vs. broad product market analysis, buyer-side harm, and hot-document identification in strategic planning market definition memos.
activates_for: [planner, solver, checker]
---

# Skill: Market Definition Analysis Memorandum

## 2. Failure modes the skill is correcting

- Baseline analyzes only one product market definition rather than walking both narrow and broad alternatives; each must be tested separately so the memo frames the full regulatory-risk range
- Baseline treats market definition as a single arithmetic exercise and misses the legal reason each boundary is plausible or weak under a hypothetical-monopolist framework
- Baseline ignores buyer-side theories of harm even where the parties compete to purchase from the same suppliers, carriers, or other input providers
- Baseline overlooks geographic narrowing at the lane, corridor, regional, or local level even when a national framing looks unconcentrated
- Baseline does not identify hot documents with competitive language for document management in a pre-HSR planning memo
- Baseline fails to use customer exclusivity, switching behavior, and internal characterizations of the parties’ competitive role as evidence bearing on market boundaries
- Baseline omits serial-acquisition context that can change the strategic significance of an otherwise modest transaction

## 3. Legal frameworks / domain conventions that apply

- Use merger-guideline market definition and hypothetical-monopolist analysis: ask whether a hypothetical monopolist over the proposed candidate market could profitably impose a small but significant and non-transitory increase in price, using substitution patterns, switching behavior, and practical indicia as the core evidence
- Treat product-market evidence and geographic-market evidence as distinct inquiries; a plausible national market does not preclude a narrower lane, corridor, regional, or local market if substitution is limited there
- Use both seller-side and buyer-side competition concepts: if the parties buy from the same input suppliers, carriers, or other upstream counterparties, analyze monopsony or buyer-power effects separately from downstream pricing effects
- Treat internal descriptions of a party as a low-cost provider, aggressive pricer, disrupter, constraint, or must-watch competitor as potentially probative of competitive significance
- Give weight to exclusivity evidence: customers who use only one channel, mode, or product category and would not switch in response to a price increase can support a narrower market definition
- Consider serial acquisition context when the transaction appears to continue a pattern of roll-up activity in the same line of business or geography
- For legal propositions, tie the conclusion to the governing antitrust framework and cite the controlling authority relied on in the source set or in standard antitrust practice; do not state a market-definition conclusion without naming the rule or doctrine that supports it

## 4. Analytical scaffolds

1. Enumerate the candidate market definitions explicitly before analysis; if more than one product, geography, or harm theory is in play, analyze each one on its own terms rather than collapsing them into a single representative pass
2. For each product market candidate, state why it is narrower or broader, then test it under the hypothetical-monopolist framework and explain the evidence that supports or undercuts it
3. For each market candidate, assess concentration and share implications only after the boundary is justified; use the source documents’ transaction facts and customer data, and avoid unsupported arithmetic
4. Evaluate exclusive-channel or exclusive-mode users as boundary evidence: identify the relevant customer segment, explain what their behavior says about substitution, and note whether it strengthens a narrow market theory
5. If the documents characterize either party as aggressive, disruptive, low-cost, or uniquely constraining, treat that as a separate competitive-significance issue and explain whether it matters to unilateral, coordinated, or exclusionary theories
6. Run a separate buyer-side analysis when the parties compete to buy from the same suppliers, carriers, or other inputs; distinguish input-competition effects from downstream customer effects
7. Walk geography from the broadest plausible frame to the narrowest plausible frame; explain why a national lens may be too coarse and where concentration or customer immobility becomes more acute
8. Review the record document-by-document for competitive language; flag documents that describe pricing, capacity, routing, bidding, customer lock-in, disciplining effects, or expansion constraints as hot and explain why they matter
9. If the record suggests prior acquisitions in the same space, assess whether the deal fits a cumulative acquisition pattern that changes the strategic risk profile

## 5. Vertical / structural / temporal relationships

- Analyze market definition across levels, not just categories: product, channel, mode, lane, corridor, region, local area, and customer segment may each support different boundaries
- Separate upstream input competition from downstream selling competition; a single transaction can create both seller-side and buyer-side concerns without the same evidence supporting both
- Read internal documents temporally: older documents may show the historical competitive baseline, while newer ones may show the transaction rationale and current competitive posture
- If the file set includes multiple acquisition waves, relate the current deal to the sequence rather than treating it as an isolated event
- Connect customer exclusivity over time to switching inertia and to the likely effect of a post-closing price increase or service degradation

## 6. Output structure conventions

- Open with a short executive summary that states the most plausible market frames and the principal regulatory risk signal
- Use separate sections for product market analysis, geographic market analysis, theories of harm, document hot spots, and entry/expansion considerations
- For each market frame, identify the evidence, explain the boundary judgment, and state the practical consequence for regulatory risk
- When multiple candidate markets are analyzed, keep them distinct and label them clearly so the reader can compare narrow versus broad outcomes
- When discussing harm theories, distinguish unilateral effects, coordinated effects, buyer-side harm, and any aggressive-pricer or disruptor-elimination theory
- For flagged documents, identify the document type and summarize the problematic competitive language without quoting more than necessary from the source set
- End with a concise Recommended Actions block that assigns next steps to counsel and business stakeholders and ties each step to the imminent pre-HSR planning milestone
- Keep the memo partner-ready: concise, decision-oriented, and organized for fast review rather than narrative excess