Another important factor that is a barrier to entry is regulations or patents. The Middle East air line industry is heavily protected by the governments of the region. Etihad Airways, being a national carrier is afforded even more protection and is relatively safe even when it does not show profits on a consistent basis. For a private organization to enter into this market would be tantamount to an athlete having to jump over a 50 feet hurdle. Unless that organization has ample resources at its disposal, quality people and a clear and unobtrusive type of a business model, it would be in its best interests to steer clear of the air line industry in the Middle Eastern region of the world.
Another important barrier is brand loyalty. For example, very few Americans who associate Coca Cola with sporting events like base ball and other important events in their life would consider switching to other brands, regardless if there is a tastier product in the market and at a lower price. As there are very few air lines in the region due to the large amount of start up capital needed, it can be very important to develop brand loyalty to stay ahead of the competitors and also prevent new entrants into the air line industry market. Also, as the costs of switching to another air line are very low or nothing, brand loyalty can play a major factor in deterring all forms of competition and new entrants into the market.
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