Portelli: Eyewear monopoly robs consumers blind

For anyone who has ever been baffled by the price tag on a pair of glasses, last week’s episode of “60 Minutes” was a real “eye opener” into the inside world of Luxottica, the largest eyewear company in the world whose monopoly on the glasses industry is detrimental to competing companies and consumers alike.

In 1961, Luxottica was a small factory located in the Italian Alps. Today it has become a multimillion dollar business, with over 800 million dollars in income per year.

Luxottica controls nearly every major retail eyewear store, including Lens Crafters, Pearl Vision and Sunglass Hut International. Luxottica CEO Andrea Guerra said about 500 million people in the world wear Luxottica eyewear. By owning every major store, Luxottica can charge any exorbitantly high price on a pair of glasses.

The company also retails eyewear for top-brand labels like Chanel, Ray-Ban and Dolce and Gabbana. These design labels don’t even create the frame design for their glasses. They send a book of their season’s looks to Luxottica, who produces a frame and then places the designers’ names on it. People who believe they are paying top dollar for a frame from their favorite designers are, in actuality, buying a Luxottica design.

Many are attracted to the bigger names because they believe they are getting an authentic design. It is no accident that Luxottica is not a publically recognized name because the company knows that people would rather buy from a well-known designer than from an unknown Italian eyewear company. Luxottica is a monopoly, marketing under brand names to make it look like there are a variety of different businesses competing against each other. The only retailers that don’t sell Luxottica eyewear are Wal-Mart, Costco and BJ’s. While a pair of glasses can cost up to $600 at a Luxottica retailer, an identical pair of glasses at Wal-Mart can cost $100.

In the past 30 years, prices of glasses have almost tripled, and it is because of Luxottica’s monopoly business. There is no reason why people should have to pay a ridiculously overpriced amount for what is basically a pair of lenses and a metal or plastic rim.

About the outlandish prices, Guerra said that glasses are “100 percent functional, 100 percent aesthetical and they need to be on your face for 15 hours a day. Not easy, and there's a lot of work behind them.” A lot of work does not mean that eyewear has to sport an inflated price tag.

Like any other major monopoly, Luxottica is smart in knowing that people will pay a lot for eyewear because they need them for everyday use. It is obvious that Luxottica is hardly concerned with the well-being of its customers and are plainly taking advantage of those who need glasses to function.

Although the glasses by higher brand names are more aesthetically pleasing, it is much more beneficial to buy from stores like Wal-Mart or Costco where the prices are significantly cheaper.