Full opinion text
MEMORANDUM OPINION BERYL A. HOWELL, District Judge. Last year, approximately 140 million Americans filed tax returns with the Internal Revenue Service (“IRS”). Paying taxes is a fundamental civic duty in our democracy. Taxes pay for the government to carry out its constitutionally mandated functions and enable the government to give force to the laws and policies adopted by the people of the United States through their elected representatives. Despite the necessity of taxes to fund our government and to sustain services that many citizens depend upon, the task of preparing a tax return brings joy to the hearts of few. Many find it to be a complex and tedious exercise. Fortunately, various businesses offer different products and services designed to assist taxpayers with preparing their returns. These tax preparation businesses principally include accountants, retail tax stores, and digital tax software providers — all of which provide important services to the American taxpayer. In this case, the United States, through the Antitrust Division of the Department of Justice, seeks to enjoin a proposed merger between two companies that offer tax software products — H & R Block and Tax-ACT — on the grounds that the merger violates the antitrust laws and will lead to an anticompetitive duopoly in which the only substantial providers of digital tax software in the marketplace would be H & R Block and Intuit, the maker of the popular “TurboTax” software program. After carefully considering all of the evidence, including documents and factual and expert testimony, the applicable law, and the arguments before the Court, the Court will enjoin the proposed merger for the reasons explained in detail below. TABLE OF CONTENTS I. BACKGROUND.................... .....................................43 A. Overview ..............................................................43 B. The Merging Parties....................................................45 C. The History Of TaxACT And The Proposed Transaction...................45 D. Free Products And The Free File Alliance................................47 II. STANDARD OF REVIEW..................................................48 III. DISCUSSION..............................................................50 A. The Relevant Product Market...........................................50 1. The Defendants’ Documents Show That DDIY Is The Relevant Product Market.................................................52 2. The Relevant Product Market Does Not Include Assisted Tax Preparation Or Manual Preparation ..............................54 3. The Economic Expert Testimony Tends To Confirm That DDIY Is The Relevant Product Market..................................60 B. Likely Effect on Competition ...........................................71 1. The Plaintiffs Prima Facie Case ...................................71 2. Defendants’ Rebuttal Arguments....................................73 a. Barriers to Entry..............................................73 b. Coordinated Effects............................................77 c. Unilateral Effects..............................................80 d. Post-Merger Efficiencies.......................................89 IV. CONCLUSION.............................................................92 1. BACKGROUND A. Overview The United States, through the Antitrust Division of the Department of Justice (the “DOJ,” the “government,” or the “plaintiff’), filed this action on May 23, 2011. The DOJ seeks to enjoin Defendant H & R Block, Inc. from acquiring Defendant 2SS Holdings, Inc. (“TaxACT”), which sells digital do-it-yourself tax preparation products marketed under the brand name TaxACT. Compl. ¶ 10. H & R Block (“HRB”) is a Missouri corporation headquartered in Kansas City, Missouri. Id. ¶ 9. 2SS Holdings, or TaxACT, is a Delaware corporation headquartered in Cedar Rapids, Iowa. Id. ¶ 10. Defendant TA IX, L.P. (“TA”), a Delaware limited partnership headquartered in Boston, Massachusetts, owns a two-thirds interest in TaxACT. Id. ¶ 11. As noted above, approximately 140 million Americans filed tax returns with the IRS in 2010. Id. ¶ 1. Broadly speaking, there are three methods for preparing a tax return. The “pen and paper” or “manual” method includes preparation by hand and with free, electronically tillable forms available on the IRS website. A second method, known as “assisted” preparation, involves hiring a tax professional — typically either a certified public accountant (“CPA”) or a specialist at a retail tax store. HRB operates the largest retail tax store chain in the United States. Cobb, TT, 9/19/11 a.m., at 37. The companies Jackson-Hewitt and Liberty Tax Service also operate well-known retail tax stores. Finally, many taxpayers now prepare their returns using digital do-it-yourself tax preparation products (“DDIY”), such as the popular software product “TurboTax.” DDIY preparation is becoming increasingly popular and an estimated 35 to 40 million taxpayers used DDIY in 2010. GX 19 at 3; see also GX 27. The three most popular DDIY providers are HRB, TaxACT, and Intuit, the maker of TurboTax. According to IRS data, these three firms accounted for approximately 90 percent of the DDIY-prepared federal returns filed in tax season 2010. GX 27. The next largest firm is TaxHawk, also known as FreeTaxUSA, with 3.2 percent market share, followed by TaxSlayer, with 2.7 percent. Id. The remainder of the market is divided among numerous smaller firms. Id. Intuit accounted for 62.2 percent of DDIY returns, HRB for 15.6 percent, and TaxACT for 12.8 percent. Id. DDIY products are offered to consumers through three channels: (1) online through an internet browser; (2) personal computer software downloaded from a website; and (3) personal computer software installed from a disk, which is either sent directly to the consumer or purchased by the consumer from a third-party retailer. GX 629 at 11. In industry parlance, DDIY products provided through an internet browser are called “online” products, while software applications downloaded onto the user’s computer via the web or installed from a disk are referred to as “software” products. See id. The proposed acquisition challenged in this case would combine HRB and Tax-ACT, the second and third most popular providers of DDIY products, respectively. According to the government, this combination would result in an effective duopoly between HRB and Intuit in the DDIY market, in which the next nearest competitor will have an approximately 3 percent market share, and most other competitors will have less than a 1 percent share. GX 27. The government also alleges that unilateral anticompetitive effects would result from the elimination of head-to-head competition between the merging parties. Compl. ¶ 45. Thus, the DOJ alleges that because the proposed acquisition would reduce competition in the DDIY industry by eliminating head-to-head competition between the merging parties and by making anticompetitive coordination between the two major remaining market participants substantially more likely, the proposed acquisition violates Section 7 of the Clayton Act, 15 U.S.C. § 18. Id. ¶¶ 40-49. Accordingly, the government seeks a permanent injunction blocking HRB from acquiring Tax-ACT. Id. ¶¶ 53-55. On July 6, 2011, the Court entered a scheduling order in this case that provided for an expedited schedule of fact and expert discovery and briefing on the government’s anticipated motion to enjoin the transaction. Joint Scheduling and Case Mgmt. Order, ECF No. 30. On August 1, 2011, the DOJ filed a motion for preliminary injunction against the merger, which was fully briefed by August 18, 2011. The parties subsequently agreed to forego the preliminary injunction phase and proceed directly to a trial on the merits of this action. TT, 9/6/11 a.m., at 8-9. On September 2, 2011, the Court held a pre-trial conference. On September 6, the Court began a nine-day bench trial that was held on September 6, 7, 8, 9, 12, 13, 15, 19, and 20. Eight fact witnesses and three expert witnesses testified at the hearing. The parties presented testimony from additional witnesses by affidavit and deposition. Each side submitted over 800 exhibits, totaling many thousands of pages. Following the conclusion of the evidentiary phase of the trial, the Court gave the parties approximately two weeks to submit post-trial memoranda and proposed findings of fact, which were filed on September 28, 2011. ECF Nos. 98-99. The Court then heard closing arguments on October 3, 2011. The government’s motion to enjoin HRB’s acquisition of TaxACT is presently before the Court. For the reasons explained in this opinion, the Court grants the government’s motion. Before proceeding to a discussion of the relevant legal standards governing this case, the Court will provide additional background regarding the parties, their proposed transaction, and the tax preparation industry in general. B. The Merging Parties HRB is a Missouri corporation with its principal place of business in Kansas City, Missouri. Compl. ¶ 9; Defs.’ Answer, ECF No. 31, ¶ 9. HRB provides both assisted tax preparation services and DDIY products through separate business units. Bennett, TT, 9/6/11 a.m., at 106. HRB offers its DDIY products for consumers under the brand name “H & R Block At Home” (formerly known as “TaxCut”). GX 629 at 9. In 2011, HRB’s DDIY products generated {significant} revenue. GX 296-2. For the same period, HRB sold approximately 6.69 million DDIY units to consumers. GX 296-2. Separately, in 2011, HRB’s assisted tax preparation business generated approximately $2.7 billion in revenue (based on 14,756,000 U.S. tax returns at an average fee of $182.96, as reported in HRB’s 2011 Annual Report). GX 532 (Cobb Dep.) at 32; GX 565 at 19. 2SS Holdings, Inc. (“2SS”) is a Delaware corporation with its principal place of business in Cedar Rapids, Iowa. Compl. ¶ 10; Defs.’ Answer ¶ 10. 2SS owns 2nd Story Software, Inc., which offers DDIY products under the brand name “TaxACT.” GX 629 at 8-9. In the fiscal year ending April 30, 2011, TaxACT products generated approximately {half as much revenue as H & R Block}. GX 151 at 6. In the same year, consumers used TaxACT to electronically file approximately 5 million federal tax returns. GX 151 at 3-4. TA IX, L.P. (“TA”) is a private equity firm organized under the laws of Delaware with its headquarters in Boston, Massachusetts. Compl. ¶ 11; Defs.’ Answer ¶ 11. In December of 2004, TA purchased a majority interest in 2SS for $85 million, and as a result TA has majority control of 2SS Holdings and 2nd Story Software. GX 55 (Greif Dep.) at 72-73; GX 28-3. C. The History Of TaxACT And The Proposed Transaction TaxACT was founded in 1998 by Lance Dunn and three others, with Mr. Dunn serving as president. Dunn, TT, 9/7/11 p.m., at 49-52. Before founding TaxACT, Mr. Dunn and the other co-founders of the company had worked at Parsons Technology, a software company that had created a DDIY tax preparation product called “Personal Tax Edge.” Id. at 49-52. In 1994, Intuit acquired Parsons Technology and continued to operate Personal Tax Edge as a separate product for approximately two years before merging it into its TurboTax product line. Id. at 51. Mr. Dunn testified that the business objective of founding TaxACT was “to make money selling value tax software which ... was a category that did not exist at that time” because Intuit’s acquisition of Parsons Technology had eliminated Personal Tax Edge, which had previously occupied a value tax software niche. Id. at 52. Thus, TaxACT “recreated” the category or “niche that the Personal Tax Edge product line filled when it existed.” Id. Over the years, TaxACT has emphasized high-quality free product offerings as part of its business strategy. Id. at 53. Tax-ACT initially offered a DDIY tax preparation product that made it free to prepare and print a federal tax return, but Tax-ACT charged a fee for electronic filing (“e-filing”) or preparation of a state tax return. Id. at 54. Thus, from the beginning, TaxACT’s business strategy relied on promoting “free” or “freemium” products, in which a basic part of the service is offered for free and add-ons and extra features are sold for a price. As Mr. Dunn put it, “Free is an integral part of the value model. And the beauty of it is it has universal appeal. Everybody likes something for free.” Id. Currently, TaxACT’s free product offering allows customers to prepare, print, and e-file a federal tax return completely for free. Id. at 54; GX 28-10 at 5-7. Tax-ACT’s “Deluxe” edition, which costs $9.95, contains additional features, such as the ability to import data from a return filed the prior year through TaxACT. GX 55-26; Dunn, TT, 9/7/11 p.m., at 91-92; GX 28-10 at 5-7; GX 28 (Dunn. Dep.) at 219. Customers who use TaxACT to prepare a state tax return in addition to a federal return pay either $14.95 for the state return in combination with the free federal product or $17.95 for the state return in combination with the “Deluxe” federal product. GX 55-26; Dunn, TT, 9/8/11 a.m., at 49. TaxACT’s prices have generally remained unchanged for the past decade. Dunn, TT, 9/7/11 p.m., at 91. The parties first began discussing the potential acquisition of TaxACT by HRB in July 2009. Bowen, TT, 9/15/11 p.m., at 14. During the fall of 2009, teams from HRB and TaxACT met to discuss the possibilities for the potential acquisition and HRB performed due diligence on TaxACT. See DX 244 at 8-9; Bowen, TT, 9/15/11 p.m., at 19-23, 26; DX 9527 at 35. Negotiations between the parties stalled in December 2009 and the proposed deal collapsed. Bowen, TT, 9/15/11 p.m., at 33. The CEOs of the two companies continued to discuss a potential acquisition through the spring of 2010, however. Id. at 34. Serious merger talks resumed in July 2010. Id. at 38-39; DX1005. In October 2010, the HRB Board of Directors approved a plan for HRB to acquire TaxACT. DX 600 at 12-13; Bowen, TT, 9/15/11 p.m., at 59-60. On October 13, 2010, HRB entered into a merger agreement with 2SS and TA. GX 120 at 1. Under this agreement, HRB would acquire control of 2SS for $287.5 million. GX 120 at 6; GX 119 at 1. HRB’s stated post-merger plan is to maintain both the HRB and TaxACT brands — with the HRB-brand focusing on higher priced-products and the TaxACT brand focusing on the lower-priced products. See Bennett, TT, 9/6/11 a.m., at 101-102; DX 1005 at 1. HRB plans {redacted} ultimately to rely on TaxACT’s current technological platform and intends to give Mr. Dunn responsibility for running the combined firm’s entire DDIY business operation from Cedar Rapids, Iowa. Dunn, TT, 9/8/11 p.m. (sealed), at 14-16; see also Bennett, TT, 9/6/11 a.m., at 110. D. Free Products And The Free File Alliance The evolution of TaxACT’s free product offerings and the other free offerings in the DDIY market is important for understanding the claims in this case. The players in the DDIY market offer various “free” tax preparation products, but the features and functionality offered in these free products vary significantly, as do the ways in which these free products are ultimately combined with paid products to earn revenue. While the availability of some types of free product offers has long been a feature of the DDIY market, a spike in free offerings occurred during the last decade in parallel with the growth of e-filing. As a matter of public policy, the IRS actively promotes e-filing because it has an interest in efficient and accessible tax return preparation and filing. The Internal Revenue Service Restructuring and Reform Act of 1998 set a goal of having eighty percent of individual taxpayers e-filing their returns by 2007. IRS Stip., ECF No. 80, ¶ 2. The IRS is close to achieving that goal and the IRS Oversight Board has recommended that the 80 percent benchmark be achieved by 2012. Id. According to stipulated facts attested to by IRS employees, in 2001, the IRS adopted an initiative “to decrease the tax preparation and filing burden of wage earners by providing greater access to free online tax preparation and filing options for a significant number of taxpayers.” Id. ¶ 4. The IRS also determined that it could save a substantial amount of public money by encouraging filers to switch to e-filing, since e-filed returns are cheaper for the IRS to process. Id. ¶ 5. The IRS determined that the most effective and efficient way to accomplish its goal of promoting access to free online tax preparation and filing options was to partner with a consortium of companies in the electronic tax preparation and filing industry. Id. ¶ 6; GX 297-D7 at E-2. In 2002, this consortium of companies formed Free File Alliance, LLG (“FFA”) in order to partner with the IRS on this initiative to promote free filing. IRS Stip. ¶ 6; GX 297-D7 at E-2. HRB, TaxACT, and Intuit are all members of the FFA, as are approximately fifteen smaller companies. See IRS Stip. ¶ 8; DX 328. On October 30, 2002, the IRS and the FFA entered into a “Free On-Line Electronic Tax Filing Agreement” to provide free online tax return preparation and filing to individual taxpayers. IRS Stip. ¶ 9. Pursuant to this agreement, members of the FFA would offer free, online tax preparation and filing services to taxpayers, and the IRS would provide taxpayers with links to those free services through a web page, hosted at irs.gov and accessible through another government website. Id. ¶ 12. HRB, TaxACT, and Intuit were among the original members to make free offers through the FFA. Id. ¶ 8. “In 2003, the first year in which free services were available to taxpayers through the FFA, none of the FFA members offered free services to all taxpayers.” Id. ¶ 14. Rather, each “member set eligibility criteria. Most members, including H & R Block, TaxACT, and Intuit, used adjusted gross income (‘AGI’) as a way to define which taxpayers were eligible” for their offers of free federal tax return preparation services. Id. “For example, H & R Block offered free services to taxpayers with an AGI of $28,000 or less.” Id. Some members that offered free federal return preparation services based on AGI also offered free services to taxpayers who met other conditions, such as eligibility to file a Form 1040EZ. Id. “Several members did not define eligibility based on AGI. Of the eleven FFA members that offered free services based on AGI, only TaxACT’s AGI-based offering was available to individuals with AGI over $33,000.” Id. Specifically, TaxACT made its free federal services available exclusively to taxpayers who had AGI over $100,000 or were eligible to file a Form 1040EZ. Id. In 2004, the second year in which free services for federal returns were available to taxpayers through the FFA, TaxACT introduced a new offer through the FFA that offered free preparation and e-filing of federal returns for all taxpayers regardless of AGI or other limitations (“free for all”). See id. ¶ 15; Dunn, TT, 9/7/11 p.m., at 65, 78. After TaxACT introduced a free-for-all offer through the FFA, other companies followed by introducing federal free-for-all offers of their own. Dunn, TT, 9/7/11 p.m., at 78 (“After we offered free for everyone in 2003, in 2004, a lot of companies offered free for everyone on the FFA.”). According to Mr. Dunn’s testimony, after TaxACT made its FFA offer of a free federal product for all taxpayers, without any AGI or other limitations, other companies made efforts to restrict the wide availability of free offers on the FFA. Id. at 79. Specifically, according to Mr. Dunn, Intuit proposed that companies in the FFA collude by agreeing to restrict free offers. Id. Mr. Dunn and TaxACT opposed Intuit’s proposal and believed that it was “probably not legal for that group to restrain trade.” Id. Subsequently, HRB, Intuit and others successfully lobbied the IRS to implement restrictions on the number of taxpayers that could be covered by a free offer through the FFA website. GX 28 (Dunn Dep.) at 114-15; GX 28-4; GX 35 at HRB-DOJ-00912870; GX 569 (DuMars Dep.) at 108, 112-113; Ernst, TT, 9/7/11 a.m., 26-27; GX 41 at 4; GX 25 (TaxHawk Decl.) ¶ 16. HRB desired these restrictions because, among other things, it was concerned about how free-for-all offers would affect the pricing structure for the industry and believed that such offers might undermine the company’s ability to generate money through the paid side of its DDIY business. Ernst, TT, 9/7/11 a.m., at 26-27; GX 531 (Ciaramitaro Dep.) at 60-62; see also GX 41 at 4; GX 25 (Tax-Hawk Decl.) ¶ 16. The IRS amended the FFA rules in October 2005 to prevent FFA members from making free-for-all offers. Dunn, TT, 9/7/11 p.m., at 78-79; Ernst, TT, 9/7/11 a.m„ at 29; GX 42; GX 25 (Tax-Hawk Decl.) ¶ 16; GX 29 (Intuit Decl.) ¶ 9. Therefore, TaxACT could no longer make its free-for-all offer through the FFA. In tax year 2005, in response to restrictions that the IRS imposed on the scope of offers that could be made through the FFA, TaxACT became the first DDIY company to offer all tax payers a free DDIY product for preparation of federal returns directly on its website. Dunn, TT, 9/7/11 p.m., at 79-80; GX 28 (Dunn Dep.) at 122-23. Today, free offers in various forms are an entrenched part of the DDIY market. Dunn, TT, 9/8/11 a.m., 85; Defs.’ Opening Stmt., TT, 9/6/11 a.m., at 86-87. II. STANDARD OF REVIEW “Section 7 of the Clayton Act, 15 U.S.C. § 18, prohibits a corporation from acquiring ‘the whole or any part of the assets of another [corporation] engaged also in commerce or in any activity affecting commerce, where in any line of commerce or in any activity affecting commerce in any section of the country, the effect of such acquisition may be substantially to lessen competition, or to tend to create a monopoly.’ ” United States v. Sungard Data Sys., Inc., 172 F.Supp.2d 172, 180 (D.D.C.2001) (quoting 15 U.S.C. § 18). “The United States is authorized by Section 15 of the Clayton Act to seek an injunction to block a pending acquisition.” Id. (citing 15 U.S.C. § 25). “The United States has the ultimate burden of proving a Section 7 violation by a preponderance of the evidence.” Id. “To establish a Section 7 violation, plaintiff must show that a pending acquisition is reasonably likely to cause anticompetitive effects.” Id. (citing United States v. Penn-Olin Chem. Co., 378 U.S. 158, 171, 84 S.Ct. 1710, 12 L.Ed.2d 775 (1964)); see also United States v. Oracle Corp., 331 F.Supp.2d 1098, 1109 (N.D.Cal.2004). “Congress used the words ‘may be substantially to lessen competition’ (emphasis supplied), to indicate that its concern was with probabilities, not certainties.” FTC v. H.J. Heinz Co., 246 F.3d 708, 713 (D.C.Cir.2001) (quoting Brown Shoe Co. v. United States, 370 U.S. 294, 323, 82 S.Ct. 1502, 8 L.Ed.2d 510 (1962)). “Section 7 does not require proof that a merger or other acquisition has caused higher prices in the affected market. All that is necessary is that the merger create an appreciable danger of such consequences in the future.” Hosp. Corp. of Am. v. FTC, 807 F.2d 1381, 1389 (7th Cir.1986). “As this Circuit explained in Heinz, 246 F.3d at 715, the decision in United States v. Baker Hughes Inc., 908 F.2d 981 (D.C.Cir.1990), sets forth the analytical approach for establishing a Section 7 violation.” Sungard, 172 F.Supp.2d at 180. “The basic outline of a section 7 horizontal acquisition case is familiar. By showing that a transaction will lead to undue concentration in the market for a particular product in a particular geographic area, the government establishes a presumption that the transaction will substantially lessen competition.” Baker Hughes, 908 F.2d at 982. To establish this presumption, the government must “show that the merger would produce ‘a firm controlling an undue percentage share of the relevant market, and [would] result [ ] in a significant increase in the concentration of firms in that market.’ ” Heinz, 246 F.3d at 715 (quoting United States v. Philadelphia Nat’l Bank, 374 U.S. 321, 363, 83 S.Ct. 1715, 10 L.Ed.2d 915 (1963)) (alterations in original). Once the government has established this presumption, the burden shifts to the defendants to rebut the presumption by “showing] that the market-share statistics give an inaccurate account of the merger’s probable effects on competition in the relevant market.” Heinz, 246 F.3d at 715 (internal quotation omitted). “ ‘If the defendant successfully rebuts the presumption [of illegality], the burden of producing additional evidence of anticompetitive effect shifts to the government, and merges with the ultimate burden of persuasion, which remains with the government at all times.’” Id. (quoting Baker Hughes, 908 F.2d at 983). Ultimately, “[t]he Supreme Court has adopted a totality-of-the-circumstances approach to the statute, weighing a variety of factors to determine the effects of particular transactions on competition.” Baker Hughes, 908 F.2d at 984. III. DISCUSSION A. The Relevant Product Market “Merger analysis begins with defining the relevant product market.” FTC v. Swedish Match, 131 F.Supp.2d 151, 156 (D.D.C.2000) (citing Brown Shoe, 370 U.S. 294, 324, 82 S.Ct. 1502 (1962)). “Defining the relevant market is critical in an antitrust case because the legality of the proposed mergerf ] in question almost always depends upon the market power of the parties involved.” Id. (quoting FTC v. Cardinal Health, Inc., 12 F.Supp.2d 34, 45 (D.D.C.1998)). Indeed, the relevant market definition is often “the key to the ultimate resolution of this type of case because of the relative implications of market power.” Id. The government argues that the relevant market in this case consists of all DDIY products, but does not include assisted tax preparation or pen-and-paper. Under this view of the market, the acquisition in this case would result in a DDIY market that is dominated by two large players — H & R Block and Intuit — that together control approximately 90 percent of the market share, with the remaining 10 percent of the market divided amongst a plethora of smaller companies. In contrast, the defendants argue for a broader market that includes all tax preparation methods (“all methods”), comprised of DDIY, assisted, and pen-and-paper. Under this view of the market, the market concentration effects of this acquisition would be much smaller and would not lead to a situation in which two firms control 90 percent of the market. This broader view of the market rests primarily on the premise that providers of all methods of tax preparation compete with each other for the patronage of the same pool of customers — U.S. taxpayers. After carefully considering the evidence and arguments presented by all parties, the Court has concluded that the relevant market in this case is, as the DOJ contends, the market for digital do-it-yourself tax preparation products. A “relevant product market” is a term of art in antitrust analysis. The Supreme Court has set forth the general rule for defining a relevant product market: “The outer boundaries of a product market are determined by the reasonable interchangeability of use [by consumers] or the cross-elasticity of demand between the product itself and substitutes for it.” Brown Shoe, 370 U.S. at 325, 82 S.Ct. 1502; see also United, States v. E.I. du Pont de Nemours & Co., 351 U.S. 377, 395, 76 S.Ct. 994, 100 L.Ed. 1264 (1956). In other words, courts look at “whether two products can be used for the same purpose, and, if so, whether and to what extent purchasers are willing to substitute one for the other.” FTC v. Staples, Inc., 970 F.Supp. 1066, 1074 (D.D.C.1997) (citation omitted); see also Bow-Ton Stores, Inc. v. May Dep’t Stores Co., 881 F.Supp. 860, 868 (W.D.N.Y.1994) (citing Hayden Pub. Co. v. Cox Broad. Corp., 730 F.2d 64, 71 (2d Cir.1984)). A broad, overall market may contain smaller markets which themselves “constitute product markets for antitrust purposes.” Brown Shoe, 370 U.S. at 325, 82 S.Ct. 1502. “[T]he mere fact that a firm may be termed a competitor in the overall marketplace does not necessarily require that it be included in the relevant product market for antitrust purposes.” Staples, 970 F.Supp. at 1075. Traditionally, courts have held that the boundaries of a relevant product market within a broader market “may be determined by examining such practical indicia as industry or public recognition of the [relevant market] as a separate economic entity, the product’s peculiar characteristics and uses, unique production facilities, distinct customers, distinct prices, sensitivity to price changes, and specialized vendors.” FTC v. Whole Foods Market, Inc. 548 F.3d 1028, 1037-38 (D.C.Cir.2008) (Brown, J.) (quoting Brown Shoe, 370 U.S. at 325, 82 S.Ct. 1502). See also FTC v. CCC Holdings, Inc., 605 F.Supp.2d 26, 38 (D.D.C.2009). These “practical indicia” of market boundaries may be viewed as evidentiary proxies for proof of substitutability and cross-elasticities of supply and demand. Rothery Storage & Van Co. v. Atlas Van Lines, Inc., 792 F.2d 210, 218 (D.C.Cir.1986). An analytical method often used by courts to define a relevant market is to ask hypothetically whether it would be profitable to have a monopoly over a given set of substitutable products. If so, those products may constitute a relevant market. See 5C Phillip E. Areeda & Herbert Hovenkamp, Antitrust Law (hereinafter, “Areeda & Hovenkamp”), ¶ 530a, at 226 (3d ed. 2007) (“[A] market can be seen as the array of producers of substitute products that could control price if united in a hypothetical cartel or as a hypothetical monopoly.”). This approach — sometimes called the “hypothetical monopolist test”— is endorsed by the Horizontal Merger Guidelines issued by the DOJ and Federal Trade Commission. See Fed. Trade Comm’n & U.S. Dep’t of Justice Horizontal Merger Guidelines (2010) (hereinafter, “Merger Guidelines”), § 4.1.1. In the merger context, this inquiry boils down to whether “a hypothetical profit-maximizing firm, not subject to price regulation, that was the only present and future seller of those products ... likely would impose at least a small but significant and non-transitory increase in price (“SSNIP”) on at least one product in the market, including at least one product sold by one of the merging firms.” Id. The “small but significant and non-transitory increase in price,” or SSNIP, is typically assumed to be five percent or more. Id. § 4.1.2. Thus, the question here is whether it would be hypothetically useful to have a monopoly over all DDIY tax preparation products because the monopolist could then profitably raise prices for those products by five percent or more; or whether, to the contrary, there would be no reason to monopolize all DDIY tax preparation products because substitution and price competition with other methods of tax preparation would restrain any potential DDIY monopolist from profitably raising prices. In other words, would enough DDIY users switch to the assisted or pen- and-paper methods of tax preparation in response to a five-to-ten percent increase in DDIY prices to make such a price increase unprofitable? In evaluating the relevant product market here, the Court considers business documents from the defendants and others, the testimony of the fact witnesses, and the analyses of the parties’ expert economists. This evidence demonstrates that DDIY is the relevant product market in this case. 1. The Defendants’ Documents Show That DDIY Is The Relevant Product Market. When determining the relevant product market, courts often pay close attention to the defendants’ ordinary course of business documents. See, e.g., Staples, 970 F.Supp. at 1076; CCC Holdings, 605 F.Supp.2d at 41-42. The government argues that the defendants’ ordinary course of business documents in this case “conclusively demonstrate that competition with other [DDIY] firms drive Defendants’ pricing decisions, quality improvements, and corporate strategy” for their own DDIY products' — thus supporting the government’s view of the relevant market. Pl.’s Post-Trial Mem. at 7. The defendants contend that the government has relied on “select, ‘out-of-context’ snippets from documents,” and that the documents as a whole support the defendants’ view that the relevant product market is all methods of tax preparation. Defs.’ Post-Trial Mem. at 1. The Court finds that the documentary evidence in this case supports the conclusion that DDIY is the relevant product market. Internal TaxACT documents establish that TaxACT has viewed DDIY offerings by HRB and TurboTax as its primary competitors, that it has tracked their marketing, product offerings, and pricing, and that it has determined its own pricing and business strategy in relation to those companies’ DDIY products. See GX 295-16 (“Competitive Analysis” comparing the three companies); GX 102 (email explaining TaxACT is a “direct competitor” with HRB and Intuit’s products); GX 55 (Greif Dep.) at 137-38 (describing TaxACT’s compilation of a routine, end-of-season competitive analysis that “typically” covers Intuit, HRB, and TaxACT). Confidential memoranda prepared by TaxACT’s investment bankers for potential private equity buyers of TaxACT identify HRB and TurboTax as TaxACT’s primary competitors in a DDIY market. See GX 7 (Greene Holcomb & Fisher “Confidential Memorandum”) at 14 (“The Company’s major competitors for both desktop and Internet-based income tax software and e-filing services include Intuit (the makers of Turbo-Tax software) and H & R Block (the makers of TaxCut software).”); GX 134 (Deutsche Bank “Confidential Information Memorandum”) at 17 (“The Company’s two main competitors, Intuit and H & R Block ...”); see also Dunn, TT, 9/7/11 p.m., at 97-104. These documents also recognize that TaxACT’s strategy for competing with Intuit and HRB is to offer a lower price for what it deems a superior product. GX 7 at 14 (“Relative to its two major competitors, 2nd Story has positioned its product offerings as being of equal or higher quality, and completely fulfilling the needs of a vast portion of the potential market. It also pursues a pricing strategy that positions its products and services meaningfully below either Intuit or H & R Block, in some instances free.”). While, as defendants point out, parts of these TaxACT documents also discuss the broader tax preparation industry, these documents make clear that TaxACT’s own view — and that conveyed by its investment bankers to potential buyers — is that the company primarily competes in a DDIY market against Intuit and HRB and that it develops its pricing and business strategy with that market and those competitors in mind. These documents are strong evidence that DDIY is the relevant product market. See Whole Foods, 548 F.3d at 1045 (Tatel, J.) (“[E]vidence of industry or public recognition of the submarket as a separate economic unit matters because we assume that economic actors usually have accurate perceptions of economic realities.”) (internal quotation omitted). Internal HRB documents also evidence HRB’s perception of a discrete DDIY market or market segment. HRB and its outside consultants have tracked its digital competitors’ activities, prices, and product offerings. See GX 28-19 (“2009 Competitive Price Comparison”); GX 118 (independent analyst’s report analyzing digital competitors as one of three separate categories of competitors); GX 61-8 at 1 (slide on competition in “digital market” identifying TurboTax and TaxACT as competitors); GX 199 (HRB “digital strategy update” Powerpoint tracking features and prices for TurboTax and TaxACT); GX 188 (HRB spreadsheet comparing HRB, TurboTax, and TaxACT prices for various product offerings). Documents from HRB’s DDIY business have also referred to HRB, TaxACT, and TurboTax as the “Big Three” competitors in the DDIY market. GX 61-3 (“OCS Offsite Competitive Intelligence Review of TS07”) at 5; GX 61-4 at 1 (email referencing request for data from consultant regarding “big 3 digital tax prep companies”); see also GX 70 (email from head of HRB’s digital business stating its “only real direct competitors are turbotax in san diego and taxact in cedar rapids” [sic]); Ernst, TT, 9/7/11 a.m., at 13-14. Finally, the documents show that, in connection with a proposed acquisition of TaxACT, HRB identified the proposed transaction as a way to grow its digital “market share” and has measured Tax-ACT’s market share in a DDIY market. GX 130 at 96-99; GX 21-37 (projections from 2009 for different potential scenarios for acquisition of TaxACT, including their effect on DDIY market share); see also Newkirk, TT, 9/7/11 a.m., at 95-96 (explaining GX 21-37). All of these documents also provide evidence that DDIY is a relevant product market. The defendants acknowledge that “the merging parties certainly have documents that discuss each other and digital competitors generally, and even reference a digital market and the ‘Big Three,’ ” but contend this evidence is insufficient to prove a market. Defs.’ Post-Trial Mem. at 9. Rather, the defendants argue that the documents show that the relevant market is all methods of tax preparation, especially in light of documented competition between DDIY providers and assisted providers for the same overall pool of U.S. taxpayers who are potential customers. See id. 9-10; see, e.g., DX 78 at 4 (Intuit document explaining 2011 strategic goal of acquiring tax store customers); GX 650 at 41 (Intuit document noting goal of acquiring tax store customers and specifically mentioning HRB). As discussed below, the Court disagrees and finds that the relevant product market is DDIY products. 2. The Relevant Product Market Does Not Include Assisted Tax Preparation Or Manual Preparation. It is beyond debate — and conceded by the plaintiff — that all methods of tax preparation are, to some degree, in competition. Pl.’s Post-Trial Mem. at 8. All tax preparation methods provide taxpayers with a means to perform the task of completing a tax return, but each method is starkly different. Thus, while providers of all tax preparation methods may compete at some level, this “does not necessarily require that [they] be included in the relevant product market for antitrust purposes.” Staples, 970 F.Supp. at 1075. DDIY tax preparation products differ from manual tax preparation and assisted tax preparation products in a number of meaningful ways. As compared to manual and assisted methods, DDIY products involve different technology, price, convenience level, time investment, mental effort and type of interaction by the consumer. Taken together, these different attributes make the consumer experience of using DDIY products quite distinct from other methods of tax preparation. See Whole Foods, 548 F.3d at 1037-38 (Brown, J.) (noting that a “product’s peculiar characteristics and uses” and “distinct prices” may distinguish a relevant market) (citing Brown Shoe, 370 U.S. at 325, 82 S.Ct. 1502); see also, e.g., GX 130 at 140 (HRB internal analysis discussing convenience and price as factors differentiating DDIY and assisted methods for consumers). The question for this court is whether DDIY and other methods of tax preparation are “reasonably interchangeable”’ so that it would not be profitable to have a monopoly over only DDIY products, a. Assisted Tax Preparation Is Not In The Relevant Product Market. Apart from the analysis of their economic expert, the defendants’ main argument for inclusion of assisted tax preparation in the relevant market is that DDIY and assisted companies compete for customers. As evidence for this point, the defendants emphasize that Intuit’s marketing efforts have targeted HRB’s assisted customers. See DX 78 at 3 (Intuit document noting strategic goal to “Beat Tax Storefs]”). While the evidence does show that companies in the DDIY and assisted markets all generally compete with each other for the same overall pool of potential customers — U.S. taxpayers — that fact does not necessarily mean that DDIY and assisted must be viewed as part of the same relevant product market. DDIY provides customers with tax preparation services through an entirely different method, technology, and user experience than assisted preparation. As Judge Tatel explained in Whole Foods: [Wjhen the automobile was first invented, competing auto manufacturers obviously took customers primarily from companies selling horses and buggies, not from other auto manufacturers, but that hardly shows that cars and horse-drawn carriages should be treated as the same product market. That Whole Foods and Wild Oats have attracted many customers away from conventional grocery stores by offering extensive selections of natural and organic products thus tells us nothing about whether Whole Foods and Wild Oats should be treated as operating in the same market as conventional grocery stores. Indeed, courts have often found that sufficiently innovative retailers can constitute a distinct product market even when they take customers from existing retailers. Whole Foods, 548 F.3d at 1048; see also Staples, 970 F.Supp. at 1074-80 (finding a distinct market of office supply superstores despite competition from mail-order catalogues and stores carrying a broader range of merchandise). The key question for the Court is whether DDIY and assisted products are sufficiently close substitutes to constrain any anticompetitive DDIY pricing after the proposed merger. Evidence of the absence of close price competition between DDIY and assisted products makes clear that the answer to that question is no — and that DDIY is the relevant product market here. See Swedish Match, 131 F.Supp.2d at 165 (“Distinct pricing is also a consideration” in determining the relevant product market) (citing Brown Shoe, 370 U.S. at 325, 82 S.Ct. 1502). Significantly, despite some DDIY efforts to capture tax store customers, none of the major DDIY competitors sets their prices based on consideration of assisted prices. See, e.g., Ernst, TT, 9/7/11 a.m., at 35 (HRB set its digital and assisted prices separately); {redacted} (Dep.) at 183:18— 25 (explaining that {redacted} does not consider assisted pricing in setting prices because its prices are already “substantially less than both tax stores and most professionals”). Indeed, there are quite significant price disparities between the average prices of DDIY and assisted products. The average price of TurboTax, the most popular DDIY brand is approximately $55. GX 293 (Intuit Dep.) at 21. The average price of HRB’s DDIY products is approximately $25. GX 296-7 at 6. Overall, the DDIY industry average price is $44.13. GX 121 at 57. In contrast, the typical price of an assisted tax return is significantly higher, in the range of $150-200. A 10 percent or even 20 percent price increase in the average price of DDIY would only move the average price up to $48.54 or $52.96, respectively — still substantially below the average price of assisted tax products. The overall lack of evidence of price competition between DDIY and assisted products supports the conclusion that DDIY is a separate relevant product market for evaluating this transaction, despite the fact that DDIY and assisted firms target their marketing efforts at the same pool of customers. The defendants point to some evidence that HRB sets prices for certain assisted products to compete with DDIY. For example, defendants note that in 2009, HRB “reduced prices on its assisted tax preparation services to $39 for federal 1040EZ preparation and $29 for state tax preparation to compete with and {redacted}” to DDIY. DFF ¶ 77a. These are limited product offerings for which prices appear well below even the 25th percentile price for HRB’s assisted products. See GX 128 (HRB “TS10 Market Dynamics” presentation) at 38 (noting, for Tax Season 2010, that the 25th percentile for prices at HRB stores was {higher than DDIY}). Relatedly, the defendants’ claim that prices for assisted and DDIY products “significantly overlap” is not strongly supported and relies on a comparison of the most limited, low-end assisted products with DDIY products generally. See DFF ¶ 78b (citing tax year 2009 data that show that 14 percent of customers using name-brand tax stores paid $50 or less and another 20 percent paid between $51-100); id. ¶ 78c-d (quoting prices for Jackson Hewitt’s preparation of form 1040EZ, a simplified tax form, at Wal-Mart and for HRB’s Second Look service, which actually only double-checks an already completed tax return for errors). In sum, while defendants’ have identified isolated instances in which assisted product offerings are priced lower than the average prices for typical assisted products, they do not and cannot demonstrate that this is generally the case. Testimony from HRB executives further supports treating DDIY as a relevant product market in evaluating this transaction. HRB’s DDIY and assisted businesses are run as separate business units. Bennett, TT, 9/6/11 a.m., at 106. Alan Bennett, who was the CEO of HRB in 2010 when the parties reached the proposed merger agreement, testified that “net-net,” he did not believe that HRB’s DDIY business had impacted its assisted business in terms of taking away customers. Id. at 108; see also GX 1151 at 4 (HRB internal analysis stating “Online is not growing materially at the expense of assisted.”). Mark Ernst, HRB’s CEO from 2001 to 2007, also explained that, in his opinion based on research he reviewed while at HRB, the primary reason consumers switched between assisted and DDIY was because of “life events” that led to changes in tax status. Ernst, TT, 9/7/11 a.m., at 34-35. Finally, defendants argue that their broad relevant market is appropriate because there is “industry movement toward ‘hybrid’ products that combine some elements of both digital and assisted tax preparation.” Defs.’ Post>-Trial Mem. at 11. Based on the evidence presented at the hearing, however, it would be premature for the Court to identify any trend toward hybrid products. In fact, neither Intuit nor TaxACT presently offers a hybrid product and the defendants openly concede that HRB’s current hybrid product has had “somewhat limited success,” which defendants attribute to “technical issues” and a “lack of consistent marketing.” Id. at 11 n. 16. {redacted} {T}he Court finds it unlikely that there will be a sufficiently large scale shift into these products in the immediate future to compel the conclusion that DDIY and assisted products make up the same relevant product market. b. Manual Tax Preparation Is Not In The Relevant Product Market. The defendants also argue that manual tax preparation, or pen-and-paper, should be included in the relevant product market. At the outset, the Court notes that pen-and-paper is not a “product” at all; it is the task of filling out a tax return by oneself without any interactive assistance. Even so, the defendants argue pen- and-paper should be included in the relevant product market because it acts as a “significant competitive constraint” on DDIY. Defs.’ Posh-Trial Mem. at 11. The defendants’ argument relies primarily on two factors. First, the defendants’ cite the results of a 2011 email survey of Tax-ACT customers. See id. For reasons detailed in the following section, the Court declines to rely on this email survey. Second, the defendants point to documents and testimony indicating that TaxACT has considered possible diversion to pen-and-paper in setting its prices. See id. at 11-12. The Court finds that pen-and-paper is not part of the relevant market because it does not believe a sufficient number of consumers would switch to pen-and-paper in response to a small, but significant increase in DDIY prices. The possibility of preparing one’s own tax return necessarily constrains the prices of other methods of preparation at some level. For example, if the price of DDIY and assisted products were raised to $1 million per tax return, surely all but the most well-heeled taxpayers would switch to pen-and-paper. Yet, at the more practical price increase levels that trigger antitrust concern — the typical five to ten percent price increase of the SSNIP test — pen-and-paper preparation is unlikely to provide a meaningful restraint for DDIY products, which currently sell for an average price of $44.13. GX 121 at 57. The government well illustrated the overly broad nature of defendants’ proposed relevant market by posing to the defendants’ expert the hypothetical question of whether “sitting at home and drinking chicken soup [would be] part of the market for [manufactured] cold remedies?” Meyer, TT, 9/13/11 a.m., at 65. The defendants’ expert responded that the real “question is if the price of cold medicines went up sufficiently, would people turn to chicken soup?” Id. As an initial matter, in contrast to the defendants’ expert, the Court doubts that it would ever be legally appropriate to define a relevant product market that included manufactured cold remedies and ordinary chicken soup. This conclusion flows from the deep functional differences between those products. Setting that issue aside, however, a price has increased “sufficiently” to trigger antitrust concern at the level of a five to ten percent small, but significant non-transitory increase in price. Just as chicken soup is unlikely to constrain the price of manufactured cold remedies sufficiently, the Court concludes that a SSNIP in DDIY would not be constrained by people turning to pen-and-paper. First, the share of returns prepared via pen-and-paper has dwindled over the past decade, as the DDIY market has grown. Bennett, TT, 9/6/11 a.m., at 118; GX 296 (Houseworth Dep.) at 66-68. Second, while pen-and-paper filers have been a net source of new customers for DDIY companies, both HRB and {redacted} executives have testified that they do not believe their DDIY products compete closely with pen-and-paper methods, {redacted} (Dep.) at 37:20-38:10; see GX 296 (Houseworth Dep.) 89-90. Third, courts in antitrust cases frequently exclude similar “self-supply” substitutes from relevant product markets. See, e.g., FTC v. H.J. Heinz Co., 116 F.Supp.2d 190, 195 (D.D.C.2000), rev’d on other grounds, 246 F.3d 708 (D.C.Cir.2001) (noting that homemade baby food and breast milk should not be included in the jarred baby food market even though substitution was possible because “the Supreme Court’s interchangeability test refers to products.”)-, CCC Holdings, 605 F.Supp.2d at 41-42 (excluding books that can be used to perform insurance loss valuations by hand from market for loss valuation software); United States v. Visa U.S.A. Inc., 163 F.Supp.2d 322, 338 (S.D.N.Y.2001) (excluding cash and checks from general purpose credit card market). The main case the defendants rely on to show that “self-supply” substitutes should be included in the relevant market involved a consumer market consisting of vertically integrated companies and explicitly distinguished cases, such as this one, involving markets of individual consumers. In United States v. Sungard Data Systems, Inc., Judge Huvelle found that disaster recovery computer systems developed internally by companies were in the same relevant product market as shared data recovery systems provided by outside vendors. Sungard, 172 F.Supp.2d at 187-89. The Sungard court, however, distinguished the case before it — which involved vertical integration — from the situation in Heinz, the case involving the market for jarred baby food, because “homemade baby food is not an aspect of vertical integration ... [and] individual consumers cannot vertically integrate by producing a product that they would otherwise have to purchase.” Id. at 187 n. 15. In finding that in-house computer systems were included in its relevant product market, the Sungard court cited the following example from Areeda & Hovenkamp ¶ 535e regarding vertical integration: If iron ore is the relevant market and if shares are best measured there by sales, then internally used ore — so-called captive output — is part of the ore market even though it is not sold as such. In measuring the market power of a defendant selling iron ore, the ore used internally by other firms constrains the defendant’s ability to profit by raising ore prices to monopoly levels. The higher ore price may induce an integrated firm to expand its ore production — to supply others in direct competition with the alleged monopolist or to expand its own steel production and thereby reduce the demand of other steel makers for ore, or both. Hence, captive output constrains the defendant regardless of whether integrated firms sell their ore to other steel makers previously purchasing from the defendant. In sum, the integrated firm’s ore output belongs in the market. Id. at 186 n. 14. This rationale for including “self-supply” in a relevant product market does not appear to apply to the DDIY market in which the consumers are individuals and not also potential traders or producers. While some diversion from DDIY to manual filing may occur in response to a SSNIP, the Court finds that it would likely be limited and marginal. The functional experience of using a DDIY product is meaningfully different from the self-service task of filling out tax forms independently. Manual completion of a tax return requires different tools, effort, resources, and time investment by a consumer than use of either DDIY or assisted methods. The following discussion from United States v. Visa U.S.A. Inc. regarding why cash and checks should not be included in the credit card market is instructive here: [Although it is literally true that, in a general sense, cash and checks compete with general purpose cards as an option for payment by consumers and that growth in payments via cards takes share from cash and checks in some instances, cash and checks do not drive many of the means of competition in the general purpose card market. In this respect, [the expert’s] analogy of the general purpose card market to that for airplane travel is illustrative. [The expert] argues that while it is true that at the margin there is some competition for customers among planes, trains, cars and buses, the reality is that airplane travel is a distinct product in which airlines are the principal drivers of competition. Any airline that had monopoly power over airline travel could raise prices or limit output without significant concern about competition from other forms of transportation. The same holds true for competition among general purpose credit and charge cards. Visa U.S.A. Inc., 163 F.Supp.2d at 338. Here, the same analogy to airplane travel holds true for competition among DDIY providers, who provide a distinct product for completion of tax returns. Indeed, the pen-and-paper method, in which the consumer essentially relies on his or her own labor to prepare a tax return, is perhaps most analogous to walking as opposed to purchasing a ride on any means of transportation. In sum, filling out a tax return manually is not reasonably interchangeable with DDIY products that effectively fill out the tax return with data input provided by the consumer. Inclusion of all possible methods of tax preparation, including pen-and-paper, in the relevant product market also violates the principle that the relevant product market should ordinarily be defined as the smallest product market that will satisfy the hypothetical monopolist test. See Merger Guidelines § 4.1.1 (“When the Agencies rely on market shares and concentration, they usually do so in the smallest relevant market satisfying the hypothetical monopolist test.”); see also Warren-Boulton, TT, 9/8/11 p.m., at 35-36. Indeed, the defendants’ inclusion of pen-and-paper in the relevant market ignores at least one obvious, smaller market possibility that they might have proposed — the combined market of all DDIY and assisted tax preparation products. It is hardly plausible that a monopolist of this market — to which the only alternative would be pen-and-paper — could not impose a SSNIP. The defendants’ proposed relevant market of all methods of tax return preparation is so broadly defined that, as the plaintiffs expert testified, there are no conceivable alternatives besides going to jail, fleeing to Canada, or not earning any taxable income. Warren-Boulton, TT, 9/8/11 p.m., at 35-36. As the plaintiffs expert put it, “if you’re talking about the market for all tax preparation, you’re talking about a market where, in economist terms, demand is completely [in]elastie. There are no alternatives.” Id. at 35. In such circumstances, the usual tools of antitrust analysis — such as the hypothetical monopolist test — cease being useful because it is self-evident that a monopolist of all forms of tax preparation, including self-preparation, could impose a small, but significant price increase. Indeed, a monopolist in that situation could essentially name any price since taxpayers would have no alternative but to pay it. As the plaintiffs expert testified, defining a market that broadly negates the entire purpose of defining a relevant market in ,an antitrust case. You want to define a relevant market in an antitrust case so then [you can calculate] shares and the change in shares makes sense. I don’t want to go to infinity ... I want to define a relevant market under ... the smallest market principle, which is I want to define the relevant market so that if a hypothetical monopolist ... did manage to control all of those products, they would impose a significant price increase, large enough to be of concern but not so large as to make the whole exercise pointless. Id. at 35-36. The Court agrees with this assessment and finds the defendants’ proposed relevant market to be overbroad. 3. The Economic Expert Testimony Tends To Confirm That DDIY Is The Relevant Product Market. Both the plaintiff and the defendants presented testimony from expert economists to support their view of the relevant product market. In addition to their testimony at the hearing, these expert witnesses also provided a detailed expert report and an affidavit summarizing their analysis and conclusions. The Court finds that the analysis performed by the plaintiffs expert tends to confirm that DDIY is a relevant product market, although the available data in this case limited the predictive power of the plaintiffs expert’s economic models. The Court also finds that it cannot draw any conclusions from defendants’ expert’s analysis because of severe shortcomings in the underlying consumer survey data upon which the defendants’ expert relied. a. Plaintiffs Expert — Dr. Warren-Boulton The plaintiffs expert, Dr. Warren-Boulton, found- the relevant product market to be DDIY. He determined that a hypothetical monopolist of DDIY products could profitably impose a SSNIP for at least one DDIY product, and that consumer substitution to assisted methods or pen-and-paper would be insufficient to defeat the SSNIP. GX 121 (Warren-Boulton Rep.) at 12. Dr. Warren-Boulton began his analysis by postulating that DDIY was the relevant product market and then he used two principal analytical tests to confirm the validity of that assumption. He began by testing DDIY as a relevant market for a few reasons. First, he concluded that the parties’ DDIY products are substantially similar in terms of functionality. GX 121 (Warren-Boulton Rep.) at 12-18. Second, he concluded from his review of the defendants’ business documents that they viewed DDIY as a discrete product market when competing in the ordinary course of business. Id. Third, he ruled out including pen-and-paper and assisted products in the relevant product market based on a consideration of various data. Id. at 24-32. Dr. Warren-Boulton’s decision to begin the relevant market analysis with DDIY was appropriate. See Ar