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“Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

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Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#101

Post by jlamberts »

Unkechaug wrote: post #93
iandanforth wrote: post #56

Earlier quoted context omitted.

Rockefeller was an ardent proponent of Monopoly because to him it was obviously the most efficient system. He controlled the price paid for crude, the manufacture of oil, and the prices paid for transportation. Under this control he substantially lowered prices for the consumer. Of course this also meant that all profits went directly to him making him one of the richest people to have ever lived. Interestingly he al…

So are you saying that this kind of situation is considered OK by most people's standards, so long as the party in control acts as a "benevolent dictator"?

I think in theory most people would agree that a benevolent dictator is a good thing both economically (monopolies) and politically (actual dictators). The problem is that human nature gets in the way in both cases, so you can't really trust a company or a leader to stay benevolent (or that their successor will be even if they are).

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#102

Post by ubernostrum »

deelowe wrote: post #70
ubernostrum wrote: post #60

Earlier quoted context omitted.

Try to start a video-sharing service. Go ahead, I'll wait. What will happen is that you will get a flood of DMCA takedown notices, and Google will get a flood of DMCA takedown notices for your site. Then Google will penalize you in search rankings for being a source of so many DMCA notices. Meanwhile, YouTube -- which generates far more takedown claims than you ever will -- is exempt from that ranking penalty because…

There are tons of video sharing services. Arguably Twitch is doing a pretty good job of taking on youtube. Do you expect a competitor to simply copy youtube and be successful? Business doesn't really work that way.

I don't mean a live-streaming service. I mean a place where you upload videos for on-demand viewing by others.

You will have an uphill battle against Google ranking penalties, while YouTube gets a free pass.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#104

Post by Erik816 »

redm wrote: post #53

I think the key point here is not whether Google is abusing its effective monopoly willingly, its that it exists at all. There may be alternatives, but not viable ones. Try not supporting Chrome or ignoring Chrome requirements such as security mandates, you will go out of business. You can say these are 'good' for the consumer but the fact that Google has the ability to unilaterally change the web itself is partially…

Well, it does matter, because under the U.S. antitrust law it is not illegal to have a monopoly. It is illegal to abuse your monopoly position. See United States v. Aluminum Corp. of America, 148 F.2d 416, 430 (1945) Learned Hand J, the "successful competitor, having been urged to compete, must not be turned on when he wins." European antitrust law is more strict and you can run into problems just for having a monopoly position even if you do not abuse it or obtain it unfairly.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#105

Post by ghaff »

jessaustin wrote: post #68
nickik wrote: post #42

Earlier quoted context omitted.

I don't quite understand what you are saying. It seem like your saying there is no natural monopoly but rather a government enforced one. Then you seem to say that the ICC did not stop 'anti-competitive' behavoir. I'm not sure what that means, all companies are against their competition. If there is not a natural monopoly why would any government agency have to do anything?

A monopoly is a seller with few or no competing sellers. In many cases this is bad for consumers, so many governments have taken steps to dismantle some monopolies or ameliorate their bad effects. It's not clear that "natural monopoly" is a category that has any members, but the theory is that a natural monopoly is a monopoly such that dismantling it would have other bad effects that would be worse than the direct ba…

The assumption around natural monopolies is that they're the inevitable result of the economic dynamics of an industry. Therefore if you carve things up to force competition, the theory goes, you're going to increase capital requirements overall and therefore prices to consumers.

It's also fairly clear that at least over long enough time horizons there aren't many natural monopolies.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#106

Post by rpiguy »

Unkechaug wrote: post #93
iandanforth wrote: post #56

Earlier quoted context omitted.

Rockefeller was an ardent proponent of Monopoly because to him it was obviously the most efficient system. He controlled the price paid for crude, the manufacture of oil, and the prices paid for transportation. Under this control he substantially lowered prices for the consumer. Of course this also meant that all profits went directly to him making him one of the richest people to have ever lived. Interestingly he al…

So are you saying that this kind of situation is considered OK by most people's standards, so long as the party in control acts as a "benevolent dictator"?

Replace the words "benevolent dictator" with "winner." People go to Google by choice, they win based on consumer preference. Unlike say, Windows, there is nothing locking you into Google you don't have to use Chrome or GMAIl, or their search.

Yes a lot of people are okay with one company controlling 80% percent of a market if - they get there by relatively fair practices, there are clear and viable alternatives, and the consumer isn't forced to use them.

Now if the behavior of the "winner" starts to have clear, negative effects on consumers and consumers are no longer happy, the story changes considerably.

Maybe I could see an argument against the greater Google ecosystem (Android, Google Play, which does lock you into Google), or the distributor of content also being a content creator, etc.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#107

Post by nabla9 »

panabee wrote: post #15

It would be great to see more balanced discourse on monopolies, especially in a software-dominated world. Most analyses and articles fixate on the costs of monopolies. Let's assume the worst of Google and conclude they abused their search monopoly. Innovation in search was stifled. Competitors were damaged and achieved only a fraction of their potential. For instance, Yelp might be worth $15B instead of $3B in a worl…

Balanced discourse should start with everybody explaining what they mean with "monopoly" and not assuming that they know or others know how the term is used.

Monopoly power. It's clear that Google does not have pure monopoly. Google has so called monopoly power.

Monopoly power can create barriers to entry with different mechanisms. Some examples

* reduced number of competitors

* limit pricing

* set-up costs

* loyalty schemes

* vertical integration

* horizontal integration

* economies of scale

* network externality

Company or companies having monopoly power does not automatically mean that they have to be divided or cut down. It means that they have to work under more restrictive rules that disable some advantages of having monopoly power.

---

Personal analysis:

I think Google, FB, MS, Apple, Amazon are doing their best using their monopoly powers get leverage and creating internet economy where distributive innovations sell to the big players and they are able to maintain the monopoly.

How to deal with that is complex issue. Limiting monopoly powers should be done intelligently.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#108

Post by [deleted] »

panabee wrote: post #15

It would be great to see more balanced discourse on monopolies, especially in a software-dominated world. Most analyses and articles fixate on the costs of monopolies. Let's assume the worst of Google and conclude they abused their search monopoly. Innovation in search was stifled. Competitors were damaged and achieved only a fraction of their potential. For instance, Yelp might be worth $15B instead of $3B in a worl…

[deleted]

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#109

Post by jessaustin »

Nav_Panel wrote: post #98
jessaustin wrote: post #68

Earlier quoted context omitted.

A monopoly is a seller with few or no competing sellers. In many cases this is bad for consumers, so many governments have taken steps to dismantle some monopolies or ameliorate their bad effects. It's not clear that "natural monopoly" is a category that has any members, but the theory is that a natural monopoly is a monopoly such that dismantling it would have other bad effects that would be worse than the direct ba…

> the theory is that a natural monopoly is a monopoly such that dismantling it would have other bad effects that would be worse than the direct bad effects of the monopoly Hm? That's not what it means. Natural Monopoly actually has a very clear Economics 101 definition: " [a]n industry in which multi-firm production is more costly than production by a monopoly "[1]. Or, paraphrased, a natural monopoly is one where fi…

If you really see a contradiction between our two definitions, I'll take your confident affirmations of the status quo with a grain of salt. See the sibling comment from 'ghaff for a much more complete understanding of this concept.

Re: “Google Is as Close to a Natural Monopoly as the Bell System Was in 1956″

#110

Post by rpearl »

FussyZeus wrote: post #17
Sylos wrote: post #8

Earlier quoted context omitted.

> At the moment I'm still tied to Chrome for bookmark sync but that's about it. You can sync bookmarks with Firefox, too. And you should be able to migrate your bookmarks just as well...

I can't get over Firefox's resource waste though. I know Chrome isn't great for it either but Firefox really takes the cake for devouring memory.

It really does seem like you sorta froze your opinions on these matters a decade ago, because in 2017 Firefox usually uses less memory than Chrome.
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