1. They can deliver the performance: Everyone will shoot themselves in the foot. Bitcoin network is no longer being decentralized when big players come in (cough....BFL's VC )I don't see how them delivering their product = end of decentralization. This is an argument that has gone roundyround, and I think it's a flawed one.
Because BFL is the ONLY supplier of such technology. The technology that can change ROI of each customer.
Note: i dont say miners are the players. If this ASIC product comes to life, every miners will be basically buying bonds from BFL.
It's a consolidation of power / leverage over the miner base. BFL relies solely on the miner base + mining difficulty/exchange rate to be profitable.
You could compare the mining community to the insurance business. BFL profits from front end, point-in-time healthy difficulty/exchange rate conditions while the mining community takes on the tail end risk of possible future downturns in mining profitability. Mining community losses will only be realized if/when two items are discovered. How much over ASIC production cost have miners paid (estimates are 10x+) and just how poorly difficulty/exchange rate affects ROI.
One could think of it another way. Hedging. Mining is the market. The source of revenue. BFL is indirectly consuming mining subsidy and depending on how high over production costs the ASICs are it would be effectively hedging against downturns in the direct source of revenue.
BFL has no other current avenue for revenue. It really isn't a safe thing. And I think this because I don't believe a single vendor can be trusted with 90%+ of market share.
Competition, especially from the mining community (less possibility of cartel like collusion or price fixing), would allow for greater leverage on the part of the mining community for enforcement of fair play.
Because the mining community is taking on tail risk the community needs to collectively cover it's tail
One method of doing so is to scrutinize the profit margins of the vendor poised to hold the vast majority of market share.