Yeah, an extreme position is the typical opening move in this sort of game. Then you negotiate, walk back from the extreme, and meet somewhere in the middle.

The more extreme your opening demand, the greater the likelihood that the eventual equilibrium point will be closer to your actual target.

And in this case the actual target is to entrench the position of the current market leaders, and then effectively close the market to new entrants. That's itself a very extreme position, so the opener has to be even more extreme than that.