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Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”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Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#91

Post by asdfasgasdgasdg »

fzeroracer wrote: post #87
asdfasgasdgasdg wrote: post #85

Earlier quoted context omitted.

> Once they've bled the competition dry, they can raise the prices again and benefit from full control over various parts of a market. A thing that HNers have been speculating will happen for years, but which has so far failed to materialize.

Failed to materialize would be objectively wrong. I even gave you a direct example in the tactics that Walmart pulled in order to destroy local stores. You can also look at how dreadful the situation is for ISPs in America.

You did not provide any evidence that Walmart raised its prices after local competition diminished. Please do not say that you did when you did not.

ISPs are often a monopoly, and often a government sanctioned one. I'd not argue against an investigation into their practices.

Re: Google, Facebook, and Amazon benefit from an outdated definition of “monopoly”

#92

Post by AnthonyMouse »

timoth3y wrote: post #75
AnthonyMouse wrote: post #70

Earlier quoted context omitted.

> Why is the market so disfunctional that a single company has effectively swallowed all competition? This is actually pretty common in hypercompetitive commodity markets. The largest player has a slight cost advantage due to economies of scale, so they have the best price and everyone buys from them. But they still have no market power because their market share doesn't come from barriers to entry. > Err, yes. It's…

> This is actually pretty common in hypercompetitive commodity markets. The largest player has a slight cost advantage due to economies of scale, so they have the best price and everyone buys from them. This is not true at all. Looking at actual competitive commodity markets for things like lumber, oil, copper, etc, we see a lot of players in the market. I can't think of a single commodity market where there is a mon…

> Looking at actual competitive commodity markets for things like lumber, oil, copper, etc, we see a lot of players in the market.

Those are all things that come from the earth (so inherently have diffuse supply), sell into the global market (so the market is large and diverse, leaving space for upstarts to find a niche) and are of strategic interest to national governments many of which then act to ensure that an independent local industry exists.

Examples of markets where this actually happens: Coca Cola (as discussed), Walmart (in local areas), YKK in zippers, AB inBev in Brazil, Luxottica in eyewear.

It's also common for this to happen with open source software, e.g. Linux on embedded devices, OpenSSH as an ssh client/server, for many years gcc as a compiler for Unix-like systems (until Apple poured money into clang to make it competitive after FSF moved gcc to GPLv3), Android on phones, etc.

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

#93

Post by bepotts »

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…

Exactly.

I don't want to get all political, but the people pushing for this definition change are (usually) economic leftists that are naturally worried about the size and power of corporations. It's their default state. There's nothing wrong with that, but be upfront with your motives and don't mask empirical concern with political ideology.

These people would have broken up Walmart in the 90s and Sears in the 70s if they could, and look where both of those companies are now.

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

#94

Post by fzeroracer »

asdfasgasdgasdg wrote: post #91
fzeroracer wrote: post #87

Earlier quoted context omitted.

Failed to materialize would be objectively wrong. I even gave you a direct example in the tactics that Walmart pulled in order to destroy local stores. You can also look at how dreadful the situation is for ISPs in America.

You did not provide any evidence that Walmart raised its prices after local competition diminished. Please do not say that you did when you did not. ISPs are often a monopoly, and often a government sanctioned one. I'd not argue against an investigation into their practices.

Walmart's tactics are extremely well-known and well-cited but if you're unable to even glance at the Wikipedia page: [1] [2] [3] [4].

You would have to be not arguing in good faith to somehow not be aware of all of the monopolistic and anti-consumer tactics Walmart has pulled, been accused of and has had to legally dealt with over the long period of time they've been active. So if you want to make any arguments about how the free market works, I think you should start by looking deeply at how Walmart is ran.

[1] https://web.archive.org/web/20051027020550/http://www.newrul...

[2] https://web.archive.org/web/20060820080242/http://www.harper...

[3] https://www.nytimes.com/2006/11/30/business/30pharmacy.html?...

[4] https://ilsr.org/walmart-settles-predatory-pricing-charge/

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

#95

Post by bepotts »

capsicum80 wrote: post #77

It is weird that microsoft is never mentioned in these articles, despite their monopoly on software in public administration, education and healthcare.

Microsoft isn't mentioned because the world shifted in such a manner where Microsoft's monopoly is no longer as important. Nobody could have predicted this in the 80s and 90s, and this situation should be a learning lesson as to why antitrust measures should be extremely rare.

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

#96

Post by colllectorof »

bilbo0s wrote: post #82
colllectorof wrote: post #73

Earlier quoted context omitted.

>The reason why anti-trust is based on precise economic definitions is that it leaves as little room as possible for the government to favor friendly players. When you need to prove harm to consumers, the bar is high, as it should be. Yeah, I'm sure that allowing companies to merge right until the point where they make consumer's lives a living hell is great for the society and the economy. >The classic example is: C…

> Google, Facebook, and Amazon control not only what you can do as a consumer... ??? I'm not sure this is true? I don't feel like they are controlling me when I go to Target or Walmart??? But I'm not sure if there is something maybe with the advertising that is making me go to Target and Walmart? Either way, it's totally up to me as a consumer where I spend my money I would think.

Not sure what Target or Walmart have to do with what I said.

Amazon doesn't control where you buy random stuff, but they have disproportionate influence in some areas, like books. I'm pretty sure they are already in the position to make or break some brands simply by banning or promoting them.

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

#97

Post by AnthonyMouse »

toast0 wrote: post #88
AnthonyMouse wrote: post #74

Earlier quoted context omitted.

> Google can (and has) ocassionaly placed banners suggesting a switch to chrome, influencing the browser market. But so can anybody else. Google sells ads on their search engine to anyone. If you asked nicely enough with a large enough pile of money they would presumably even sell you a banner placement. What is the objection supposed to be? That Google didn't pay itself for the ad space? How would it have changed an…

How much would Google charge me to put a prominent banner next to the search box saying that Google recomends w3m for the best browsing experience on Google search? My guess is they would have considered it before they had their own browser, but now that chrome is something they've invested in, it seems like something that is not for sale. How much of an impact is that placement? I don't really know, but I bet Google…

> How much would Google charge me to put a prominent banner next to the search box saying that Google recomends w3m for the best browsing experience on Google search?

They're under no obligation to sell their endorsement. And what difference does the specific price make for placement? Suppose it was a lot.

> Anyway, the point is that's something they can do, because they control so much of search. Bing putting up a banner that says hey, why don't you use Edge, pretty please doesn't have as much impact, because Bing has a smaller market share.

How is it different than a company that just has more money and can therefore afford to buy more advertising? It's effectively what they're doing -- they could have sold the space they're using to advertise Chrome to a third party for its market value. By using it themselves they're foregoing that revenue, essentially the Chrome division purchasing the space from the search division.

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

#98

Post by AndrewKemendo »

Look no further than the dozens of examples of major tech companies essentially "dumping" product to kill up and coming startups.

Diapers.com was the ultimate example of this [1]

Soon after, Quidsi noticed Amazon dropping prices up to 30 percent on diapers and other baby products. As an experiment, Quidsi executives manipulated their prices and then watched as Amazon’s website changed its prices accordingly. Amazon’s pricing bots—software that carefully monitors other companies’ prices and adjusts Amazon’s to match—were tracking Diapers.com.

This is unambiguously Amazon using their Market power to stifle competition.

Now, you might say something like - yea that's just competition, or to the victor go the spoils. However that's the whole point of this kind of advocacy - to prevent companies from taking significant market power and spreading out the competitive landscape. The language may not perfectly fit between "monopoly" or otherwise, but the end result is the same: Small players can't compete. Best thing you can hope for is an acquisition.

This is especially bad in technology, where information advantages grow with the scope of the company.

[1] https://slate.com/technology/2013/10/amazon-book-how-jeff-be...

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

#99

Post by AndrewKemendo »

bilbo0s wrote: post #86
nicoburns wrote: post #32

Earlier quoted context omitted.

> 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. No, they're saying a company can have too much economic power without being a full monopoly.

> No, they're saying a company can have too much economic power without being a full monopoly... But that's not a problem. Monopolies are problems, not strong economically powerful companies. I mean, up in my neck of the woods, ADM and Cargill are unimaginably powerful economically speaking. But it just makes no sense to say that they are as dangerous as having one company that IS the entire food market.

Yes, strong economically powerful companies are a problem.

Or rather, lets say it like this: This history of strong economically powerful companies points to them being problematic for democratic societies.

Why? Because the stickier the product, the more "powerful" the company, and the more likely they are to do things like regulatory capture and exert significant control of democratic levers.

Make no mistake that corporations are political entities and are not-neutral in that respect. So the bigger the company, the more they can exert influence well beyond their ability to provide goods/services.

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

#100

Post by AndrewKemendo »

sonnyblarney wrote: post #66
wpasc wrote: post #50

Earlier quoted context omitted.

I frequently see people say "Google should be broken up" and I want to hear more on that argument. Meaning Google and Youtube should be separated? but then we're no longer talking about just their search dominance right? How could search alone be broken up if a large part of the complaint is about the dominance of their search? Moreover, it is pretty easy to not use google search? Why couldn't someone use DDG, Yahoo,…

There are two arguments, one is about Search as a monopoly the other is about that power as it relates to other parts of the value chain. Google search is fundamentally better than DDG (for most purposes) because it has massive advantages that make it effectively unassailable. For example, I stopped using DDG because I rely on reverse image search. FYI DDG does not have its own crawler, it gets data from other source…

This is well written and I would add that the counterargument people are throwing up about how there are no "barriers to entry" for search etc... is a red herring. Really, it's misunderstanding what is required for entry.

As a thought experiment, lets say that three people came up with a WAY better search engine than google. Like way better. Will this new company be able to take search market share away from Google? No.

Why? Chrome is now the dominant browser with Google search built in. Google is the default search on Apple and Android Devices. Google has Billions in marketing for search.

But most importantly, Google has the best engineers on the planet and they can re-build what this crack team did, deploy it to a billion people and drain you in court if you decide to fight them.

Wouldn't you rather just sell to them and cash out instead of getting taken out?

That's how this game goes.

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