market power is Microsoft's market share in PC operating systems. The United States v. Microsoft case dealt with an allegation that Microsoft illegally exercised its market power by bundling its web browser with its operating system. In this respect, the notion of dominance and dominant position in EU Antitrust Law is a strictly related aspect. Oligopoly power Another form of market power is that of an oligopoly or oligopsony. Within this market structure, the market is highly concentrated and several firms control a significant share of market sales. The main characteristics of an oligopoly are: A few sellers and many buyers. Homogenous or differentiated products. High barriers to entry. This includes, but is not limited to, 'technology challenges, government regulations, patents, start-up costs, or education and licensing requirements'. Interaction/strategic behaviour. It is salient to note that only a few firms make up the market share. Hence, their market power is large as a collective and each firm has little or no market power independently. Generally, when a firm operating in an oligopolistic market adjusts prices, other firms in the industry will be directly impacted. The graph below depicts the kinked demand curve hypothesis which was proposed by Paul Sweezy who was an American economist. It is important to note that this graph is a simplistic example of a kinked demand curve. Oligopolistic firms are believed to operate within the confines of the kinked demand function. This means that when firms set prices above the prevailing price level (P*), prices are relatively elastic because individuals are likely to switch to a competitor's product as a substitute. Prices below P* are believed to be relatively inelastic as competitive firms are likely to mimic the change in prices, meaning less gains are experienced by the firm. An oligopoly may engage in collusion, either tacit or overt to exercise market power and manipulate prices to control demand and revenue for a collection of firms. A group of firms that explicitly agree to affect market price or output is called a cartel, with the organization of petroleum-exporting countries (OPEC) being one of the most well known example of an international cartel. Sources of market power By remaining consistent with the strict definition of market power as any firm with a positive Lerner index, the sources of market power is derived from distinctiveness of the good and or seller. For a monopolist, distinctiveness is a necessary