121–130 of 260 posts
Ma Bell's users were Ma Bell's customers.
Google's users are not Google's customers - they are Google's product. Google's customers are advertisers, and it is there where Google has a monopoly, and talk of "cost of switching" is meaningless in that respect - other advertising venues are meaningless for most advertisers.
Earlier quoted context omitted.
> 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.
You say: dismantling it would have other bad effects that would be worse than the direct bad effects of the monopoly
I wanted to clearly state that it's not some sort of abstract "other bad effects", it's that prices would increase for the consumer if the monopoly was disbanded.
My thought/critique of ghaff's comment involves physical last-mile infrastructure. Alternatives to regular natural monopolies exist, but we'd have to have some pretty tight regulations on how, say, land beneath or above roadways could be used.
The idea of having monopolies at local scales that compete at larger scales makes sense to me. But replicating last-mile infrastructure seems wasteful/bad/hard to solve (multiple companies building overhead power lines? multiple companies laying wire beneath roadways and apartment buildings? how do we deal with public land being used for private infrastructure purposes?) without some sort of regulatory control.
Looking at it over sufficiently long time horizons and saying "well, it's all temporary anyway" kinda buries the purpose of even having a discussion.
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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"?
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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.
Ma Bell's monopoly has never been "natural". It has been enforced by FCC, ever since FCC was formed for that specific purpose in 1934. Even before that, ICC through the Kingsbury Commitment had adopted an ill-considered and unjustified hands-off policy with respect to Ma Bell's anticompetitive actions.
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> There are other ways to build a business that don't depend on search. There are also other ways to run a household that don't depend on running water. (Heck, my great-grandpa never complained about having an outhouse.) Are you saying your local water utility should be an unregulated monopoly?
Yes and there are plenty of houses that couldn't get water from the municipality and got their water from a well. My grandparents had a well for 30 years.
I wonder how does this refer to Microsoft with Azure and other companies with ultra-broad platform offerings with hundreds of services and products. Maybe internet companies should scale horizontally and not verticly in their product offering after they reach certain size?
People who use some Google services tend to use mostly Google services. People who use some Microsoft services tend to use mostly Microsoft services.
Without much stricter regulation to at bare minimum require more intercompatibility between competing ecosystems, I don't see this effect decreasing.
It's hard to see any comparison. At the peak of AT&T's power, they were able to block sales of a third-party device that attached to your phone that helped keep people from overhearing your conversations. The device was just a cup, it didn't do anything electrical, but AT&T still decided they didn't like it and shut it down. That was eventually overturned in court, but it was a decade-long fight. It took another deca…
I agree with what you wrote, but the comparison is apples to oranges: Google customers are businesses; end users (who CAN switch easily) are the product. Right now the only (supposedly) viable competitor is Facebook, but it's more of an advertising duopoly that divides the market - all the people I know who advertise say that you use FB for brand/interaction/marketing and Google for sales, and for a specific spend it…
I am a Google customer. They provide me with a product (Google) which I pay for by allowing Google to display advertisements on the results.
A business is also a Google customer. They pay Google to display ads to a visitors to the website.
But that distinction is moot anyway. Businesses aren't covered by consumer protections because they aren't "consumers".
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…
Whats the viable alternative to Google Search? Sure you can use Bing as a customer, but if you're a website operator you HAVE to stay on Google's good side. (not always easy to do) Or you can not base your business on the fickleness of Google's search algorithms. Ben Thompson (stratechery.com) posts one article per week publically and charged $100 a year for his newsletter. The only time he gave numbers, he has over…