The second company might think there is a market for 100k users, and price accordingly at $10, but only sell 10k copies and go out of business.
Now, however, people see the product as only being worth the lower price point of $10, and won't pay $100 for it anymore. So company A can only sell 1000 copies at $100, and also goes out of business.
The second company might think there is a market for 100k users, and price accordingly at $10, but only sell 10k copies and go out of business.
Now, however, people see the product as only being worth the lower price point of $10, and won't pay $100 for it anymore. So company A can only sell 1000 copies at $100, and also goes out of business.