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Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

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Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#21

Post by matthewmacleod »

Nullabillity wrote: post #17
ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

> The classic example is: Coca-Cola has a 95% market share of the cola market in some countries. Does it mean it has a monopoly? No. Effectively, yes. Why is the market so disfunctional that a single company has effectively swallowed all competition? > If it had 100% of the cola market, would it have a monopoly? No. Err, yes. > Because the cola market doesn't exist in isolation. Colas compete with all other sodas, wi…

That’s not a particularly convincing argument - it’s like saying that Sony has a monopoly in the PlayStation market - possibly true, but not that useful!

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#22

Post by ImprovedSilence »

here's what gets me. per the article: >>"Google owns 92% market share of internet searches, Facebook an almost 70% share of social networks. "

but us the searchers and friends are not the customer. FB and google are selling ads, and they are in direct competition with each other. If I want to buy advertising space online, I have plenty of options and the innovation for me to reach my target customers is astounding. The system is working exactly as it should. Or so it goes from a monetary point of view.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#23

Post by matthewmacleod »

AnimalMuppet wrote: post #18
amelius wrote: post #13

In my view, unfair competition practices begin when investors make a huge pile of money to "out-money" any competition. For example, how is it fair that a bunch of investors make a pile of money so big that it puts small bookstores out of business?

Nobody owed small bookstores a living. If Amazon can give people more choice at the same or better prices, why should the small bookstores survive? They're less efficient and therefore wasting resources. (Yes, I know, small bookstores provide a whole different experience than shopping on Amazon. The thing is, nobody cares . Or at least too few people care to make the small bookstores into viable businesses.) How did…

I do generally agree, but capital can really distort fair competition in the long run. A large investment can be used to sell products at unsustainable prices until competitors go out of business, before jacking them up for the now-captive market. Classic predatory pricing.

It’s often the case that this is harmful to the market in the long term.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#24

Post by inherentFloyd »

ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

Power corrupts, man. Simply hiding behind a monopoly doesn't really absolve a company of wrongdoing simply because a monopoly isn't wrong. Also, in your example, Coke definitely has a monopoly on the cola market, even if it doesn't on the entire soda market. That's like saying a smaller cola company stands a chance on the global market because the smaller competitor is selling soda.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#25

Post by nitwit005 »

Nullabillity wrote: post #17
ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

> The classic example is: Coca-Cola has a 95% market share of the cola market in some countries. Does it mean it has a monopoly? No. Effectively, yes. Why is the market so disfunctional that a single company has effectively swallowed all competition? > If it had 100% of the cola market, would it have a monopoly? No. Err, yes. > Because the cola market doesn't exist in isolation. Colas compete with all other sodas, wi…

> Effectively, yes. Why is the market so disfunctional that a single company has effectively swallowed all competition?

If people just like their product more, what's the problem? There's no point in punishing them for being cheaper or more liked than the competition.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#26

Post by ucaetano »

Nullabillity wrote: post #17
ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

> The classic example is: Coca-Cola has a 95% market share of the cola market in some countries. Does it mean it has a monopoly? No. Effectively, yes. Why is the market so disfunctional that a single company has effectively swallowed all competition? > If it had 100% of the cola market, would it have a monopoly? No. Err, yes. > Because the cola market doesn't exist in isolation. Colas compete with all other sodas, wi…

> Effectively, yes.

No. You can always create a market where a company has a "monopoly" (in the market share sense of the word).

> Why is the market so disfunctional that a single company has effectively swallowed all competition?

Where did you get that from? This is a sign that you don't understand the market you're talking about.

> And AT&T wasn't a monopoly, since you could just walk to the person you want to talk to. Oh, wait..

That doesn't make any sense, you're not even wrong.

It isn't just because you can create a mental analogy about a subject you don't understand, that the analogy is actually valid.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#27

Post by ucaetano »

chrisco255 wrote: post #16
ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

That would depend on the antitrust laws in said country. And if Coke had 95% market share in the U.S., it could easily be ruled a monopoly.

> And if Coke had 95% market share in the U.S., it could easily be ruled a monopoly.

Nope. Because monopoly isn't just about market share. That's what people here don't seem to understand.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#28

Post by xanipher »

AnimalMuppet wrote: post #18
amelius wrote: post #13

In my view, unfair competition practices begin when investors make a huge pile of money to "out-money" any competition. For example, how is it fair that a bunch of investors make a pile of money so big that it puts small bookstores out of business?

Nobody owed small bookstores a living. If Amazon can give people more choice at the same or better prices, why should the small bookstores survive? They're less efficient and therefore wasting resources. (Yes, I know, small bookstores provide a whole different experience than shopping on Amazon. The thing is, nobody cares . Or at least too few people care to make the small bookstores into viable businesses.) How did…

I don't know about the US, but in Europe the big one was taxes: Due to loopholes in tax regulations, weird accoubting practices, etc. Amazon pays next to no taxes, whereas small bookstores who can't afford to "Double-Irish with a Dutch" their taxes pay way more.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#29

Post by ucaetano »

matthewmacleod wrote: post #21
Nullabillity wrote: post #17

Earlier quoted context omitted.

> The classic example is: Coca-Cola has a 95% market share of the cola market in some countries. Does it mean it has a monopoly? No. Effectively, yes. Why is the market so disfunctional that a single company has effectively swallowed all competition? > If it had 100% of the cola market, would it have a monopoly? No. Err, yes. > Because the cola market doesn't exist in isolation. Colas compete with all other sodas, wi…

That’s not a particularly convincing argument - it’s like saying that Sony has a monopoly in the PlayStation market - possibly true, but not that useful!

Exactly: you can absolutely always define a market here a company has a close-to-100% market share.

That's why, to actually talk about a monopoly, you need to very precisely define the market.

Take Facebook: Facebook has a monopoly in online, blue-themed social networks owned by Harvard dropouts.

It doesn't have a monopoly on social networks, on communication, on online networks, on online ads, on online ads in social networks, on blue-themed online social networks, and even on blue-themed online social networks with a timeline feature.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#30

Post by ucaetano »

inherentFloyd wrote: post #24
ucaetano wrote: post #14

It isn't outdated, it is an economics definition of a monopoly, and isn't even that: a monopoly is perfectly fine, AS LONG AS the economic power isn't abused to prevent competition which harms consumers. What the author is proposing is that regulation is no longer based on economics and economic power, but on a vague definition of monopoly, and people are absurdly trigger-happy when calling something a monopoly. The…

Power corrupts, man. Simply hiding behind a monopoly doesn't really absolve a company of wrongdoing simply because a monopoly isn't wrong. Also, in your example, Coke definitely has a monopoly on the cola market, even if it doesn't on the entire soda market. That's like saying a smaller cola company stands a chance on the global market because the smaller competitor is selling soda.

> Also, in your example, Coke definitely has a monopoly on the cola market, even if it doesn't on the entire soda market.

No, it doesn't. At least not by the economic definition of monopoly, which, when talking about regulation, is the one that matters.

And even then, it is irrelevant, because the cola market doesn't exist in isolation.

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