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Trust-Busting as the Unsexy Answer to Google and Facebook

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Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#181

Post by AnthonyMouse »

wilburTheDog wrote: post #133
AnthonyMouse wrote: post #121

Earlier quoted context omitted.

> The problem with Facebook/Amazon/Google is that they have a monopoly on a specific information network, for Facebook the social graph, internet discoverability for Google, and online shopping for Amazon. None of these things are a natural monopoly. Facebook only stays relevant by buying its competitors. You don't even need to break them up, just disable acquisitions. Then Instagram would be separate, WhatsApp would…

>Just stop letting them buy their competitors. And how would you stop them from simply replacing their competitors? From the article "Budding companies that resist being acquired are pruned through flagrant copying." Would you pass a law that said Facebook can't expand their business to do anything a competitor is doing? I can't see how that would fly.

Copying doesn't really work. WhatsApp was big before Facebook bought them. Just because you copy some feature they had doesn't mean anybody is going to move back. Having the feature first makes you better. Having the feature second only makes you the same.

And the challenger has an advantage against a conglomerated incumbent because they can add features that reduce profits in ancillary markets the challenger isn't in. The incumbent won't want to copy that and cannibalize their other market, but the users want that feature so the challenger gains market share.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#182

Post by JumpCrisscross »

fallingknife wrote: post #77
JumpCrisscross wrote: post #12

Earlier quoted context omitted.

> How does breaking up Facebook help fight misinformation, polarization, engagement baiting, objectionable content, etc? It reduces the influence that a monolithic Facebook can bring to bear against its critics in Congress. It also puts existential risk on the table. Fining Facebook out of existence is, presently, political suicide. Not only does it hit a massive slice of the electorate, it leaves them with no altern…

Yes good point. If FB were less politically powerful, then they wouldn't be able to stop the good people in congress from regulating what people say on the internet. That would clearly solve the problem! The government has never been involved in spreading misinformation, so I don't see how this could go wrong.

> if FB were less politically powerful, then they wouldn't be able to stop the good people in congress from regulating what people say on the internet

Would encourage anyone thinking like this to pause and consider if this reaction is coming from a place of reason or a sense that they are coming for our team.

If Mark Zuckerberg is the person you trust to protect your rights over our elected government, you've traded freedom for security and will likely get neither. Congress would love to pass laws restricting what people say on Facebook. Unfortunately, it can't because of the First Amendment. Facebook, on the other hand, is legally unconstrained.

More pointedly, Facebook is fine if Congress tries to regulate speech on its platform. It can point to D.C. and take the blame off its back. What Facebook is not fine with is Congress regulating all the other parts of its organization that it would rather remain hidden. In case it needs to be said, those parts aren't working in your interest.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#183

Post by allturtles »

Imnimo wrote: post #160
allturtles wrote: post #106

Earlier quoted context omitted.

I think it's even more wrong than that, and suffers badly from post hoc ergo propter hoc. How could the growth of answering machines be connected to the break-up of AT&T, which was about separating local from long-distance service? According to https://americanhistory.si.edu/collections/search/object/nma... , there were commercial answering machines being sold in the U.S. in 1960. The increase in the use of answering…

>How could the growth of answering machines be connected to the break-up of AT&T AT&T enforced a rule that you could not connect "foreign attachments" to the phone network, which included answering machines not made by them. https://dcchs.org/the-era-of-ma-bell/

Per your linked article: "That began to change in the 1950s ... Following the D.C. Circuit’s Hush-a-Phone decision, the FCC began establishing standards that would allow the sale and use of myriad devices on the telephone network, from answering machines, to fax machines, to computer modems."

The break-up didn't happen until 1982.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#184

Post by AnthonyMouse »

Apes wrote: post #125
AnthonyMouse wrote: post #121

Earlier quoted context omitted.

> The problem with Facebook/Amazon/Google is that they have a monopoly on a specific information network, for Facebook the social graph, internet discoverability for Google, and online shopping for Amazon. None of these things are a natural monopoly. Facebook only stays relevant by buying its competitors. You don't even need to break them up, just disable acquisitions. Then Instagram would be separate, WhatsApp would…

Amazon does leverage their position as market maker to undercut competition with anti-competitive practices though. They run data analytics to figure out what goods are the most profitable, then launch competing products and promote their own over the originals in their listings. Their monopoly gives them the ability to take over nearly any market they want at any time, with no consequences.

> They run data analytics to figure out what goods are the most profitable, then launch competing products and promote their own over the originals in their listings.

Figuring out which products have high margins and entering those markets is an increase in competition.

Promoting their own listings is only a problem if the competitors can't reach those customers in any other reasonable way, which isn't the case because there are many other online retailers and it's quite feasible for a medium sized competitor to sell directly to the customer on their own website.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#185

Post by AlbertCory »

AlbertCory wrote: post #56

I wrote this [1] four years ago. It shows how to break up FAANG by making their biggest asset, their data, transparent and regulated. And you would get a check from it. Imagine your consuming history on Amazon in a company by itself, you own dividend-paying shares, and if you don't like their policies, you can take the data elsewhere, or keep it private. Anyone who wants to use it, including "Amazon" itself, has to p…

I should add here that Sec. of Energy Jennifer Granholm wrote & asked me something about it. No other major impact that I'm aware of.

If your argument is "this would be complicated!" I'd say "compared to what? the 14-year case against AT&T? the case against Microsoft, which ended in no breakup?" Do you really think a breakup of FAANG would be any simpler?

I spent several years at Google working with ads data. By far most of my work was with anonymous & aggregated data. In my proposal, that work, too, would require a license from the Data company, and the owners of that data would share in the profits from it.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#186

Post by dahfizz »

mrkurt wrote: post #87
sanderjd wrote: post #46

Earlier quoted context omitted.

I know this is the inevitable and cliche pushback, but it never seems to be grappled with so it remains worth pointing out: none of the three things you mentioned are anywhere close to monopolies. There are lots of social networks (Twitter and TikTok are extremely successful, among others), lots of ways to search the internet, and lots of ways to shop online. The analogy with the railroads simply is not apt, their mo…

Antitrust is much broader than "monopolies". It's all about concentrated power. Saying "monopoly" is just shorthand for market power, it's not a binary definition.

"monopoly", "monopoly power", and "market power" all have related but very much distinct definitions.

This is how the justice department defines them: https://www.justice.gov/atr/competition-and-monopoly-single-...

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#187

Post by nathias »

jimmaswell wrote: post #62
camjohnson26 wrote: post #9

Trust busting can seem like it’s anti free market, but when a company has a monopoly on a network it stops functioning as a company and basically becomes a government. The problem with Facebook/Amazon/Google is that they have a monopoly on a specific information network, for Facebook the social graph, internet discoverability for Google, and online shopping for Amazon. It’s similar to if a single company owned the ro…

A social network is a natural monopoly due to the network effect. It wouldn't make any sense to split it up. Regulating it like any other natural monopoly could make sense. Amazon is certainly not an online shopping monopoly. It's just a superior service. I can get a similar online shopping experience from Wal Mart and many others. If Amazon can offer us such good service through having its own big network of warehou…

>A social network is a natural monopoly due to the network effect.

Thats exactly why it should be split up and regulated more heavily.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#188

Post by 1vuio0pswjnm7 »

camjohnson26 wrote: post #9

Trust busting can seem like it’s anti free market, but when a company has a monopoly on a network it stops functioning as a company and basically becomes a government. The problem with Facebook/Amazon/Google is that they have a monopoly on a specific information network, for Facebook the social graph, internet discoverability for Google, and online shopping for Amazon. It’s similar to if a single company owned the ro…

The only way these companies can generate sufficient revenues is through advertising. It really does not matter what moonshot projects they are working on. There is not enough willingness to pay for that "work" to sustain a business.

The internet has value besides being a vector for advertising. This is more or less what the parent comment is suggesting.

Who pays the cost of supporting the internet. Internet subscribers. We finance (a) the delivery of advertising, (b) creation metadata about our usage (e.g., empty POST requests, beacons, various forms of telemtry, etc.) and (c) uploading our data to their computers.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#189

Post by throwaway09223 »

AnthonyMouse wrote: post #175
throwaway09223 wrote: post #144

Earlier quoted context omitted.

Google isn't primarily a search engine. By revenue they're primarily an ad network. Ad networks naturally form monopolies. Ad matching algorithms can make better matches (more revenue per click and more desirable product for advertisers) the more ad campaigns they have to select from and the more display properties they have to publish ads to. It's a market extremely prone to winner-takes-all. I say this as someone w…

Ad networks don't naturally form monopolies. That's why Google had to buy the other ones. Anything will form a monopoly if you let every company in the industry merge. Just because something has a network effect doesn't make it a natural monopoly. The network effect means the network may need a minimum size in order to be viable, but that doesn't mean there can't be a dozen competing networks of that size that are al…

It does, because the increased efficiency means ads are more profitable on the larger platforms. Bigger matching pools mean better conversion rates.

Why would you spend more money to buy a less-well performing ad?

Why would you display a less well paying ad on your web property?

If you're doing search ads, you cannot fund the megawatts of infrastructure to keep pace with google if you're working with smaller margins. This is not theoretical - adwords/search has destroyed almost all of the competition, save those who have other ways of funding themselves.

Re: Trust-Busting as the Unsexy Answer to Google and Facebook

#190

Post by dahfizz »

bmitc wrote: post #168
sanderjd wrote: post #46

Earlier quoted context omitted.

I know this is the inevitable and cliche pushback, but it never seems to be grappled with so it remains worth pointing out: none of the three things you mentioned are anywhere close to monopolies. There are lots of social networks (Twitter and TikTok are extremely successful, among others), lots of ways to search the internet, and lots of ways to shop online. The analogy with the railroads simply is not apt, their mo…

I made a comment recently addressing these very things. https://news.ycombinator.com/item?id=28851867 My contention summarized is that using market share as it has historically been used is not good, because these software-based companies can scale to much greater power than ever before whereas in the past, one had to gain significant market share to wield the same or even less power.

I think you and OP agree. Tech giants are clearly "too powerful" and need to be dealt with, but the traditional formulation of monopoly power is not a good way to deal with these tech giants.
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