5 ms·

Historically, utilities/public services are things that have a natural monopoly, which absolutely applies to ISP/other wireline telcoms (city franchise licenses

Historically, utilities/public services are things that have a natural monopoly, which absolutely applies to ISP/other wireline telcoms (city franchise licenses), mobile cell service (limited competition due to spectrum auctions and the need for enough nationwide spectrum to be accumulated to launch a viable service), water, sewer, power, gas, etc. It might apply to things like undersea cables, although there isn't really a natural monopoly (plenty of space under the ocean) and those primarily connect two privately owned datacenters. It applies to other services such as post office and city trash where either laws (private express statutes) prohibit competition for the sake of making the public service more profitable, or where taxes force the customer to "buy" the public trash pickup, making even the best-run private enterprise unable to compete. It is technically quite trivial to clone the basic functionality of Twitter and run a competing service. This has been done semi-sucessfully with Gab (not endorsing that community, but it is a good example), for example. People choose social media services based on their perceived value, social prestige, etc. There's no equivalent to "I have to use Twitter because they own the lines to the house/they have the only 5G coverage in my area/they are the only company licensed by my city." Twitter is not the only physically possible way to publish short messages to the world (unless the ISPs ruin that now that net neutrality is gone).

guscost 6y ago
You could technically set up a mesh network and bypass the ISP too. I don’t think that argument is aging well, since it depends on some essential distinction between “telephone wire” type infrastructure and “server farm” or “installed base” type infrastructure. Why should we assume that a global content management and delivery network, broadcasting 500 million messages every day, is trivially replaceable? The fact is nothing has even come close to replacing it.
- nitrogen 6y ago
  The fact is nothing has even come close to replacing it. Indeed, it seems that just as there are natural monopolies over physically exclusive infrastructure like roads and cables, there are natural monopolies over network effects and attention/mindshare.
  - Meph504 6y ago
    I think the argument on monopoly is getting muddied, a monopoly isn't based on consumer's choosing a preferred service, but that they have no choice of provider. Twitter is popular because people choose to use it, but they have the choice to use other services, or to attempt to create one, and compete with the current popular one, the difficulty of succeeding in the field doesn't change if it is a monopoly (unless of course the service provider can suppress any competitor from entering the market.) Was MySpace a monopoly? it dominated social media at its peak, and not has been completely surpassed.
    - nitrogen 6y ago
      There were other operating systems for PCs besides MS Windows in the 1990s, but Windows was still a monopoly. Yes Myspace was a monopoly until Facebook opened to tbe public because it was the only way a bunch of people were willing to communicate for a while.
      - Meph504 6y ago
        I think you might want to do some double checking on your history. Firstly Microsoft monopoly got thrown out because of unethical behavior of the judge (which is why there isn't two Microsoft entities today. The whole thing hinged on "Microsoft installed its browser by default which gave it an unfair advantage." To allow the DOJ to save face, Microsoft agreed to make it easier to install other browsers. And My Space wasn't a monopoly, there was a parade of social networking sites of various popularity and success starting with bolt in the late 90s and most directly before MySpace was Friendster. Compare these applications, to say power companies, or ISPs in much of the US. The difference is really clear.
        perrylaj 6y ago
        First - you seem to be misunderstanding (or misrepresenting) the facts and results of the Microsoft case. > Firstly Microsoft monopoly got thrown out because of unethical behavior of the judge (which is why there isn't two Microsoft entities today. The whole thing hinged on "Microsoft installed its browser by default which gave it an unfair advantage." To allow the DOJ to save face, Microsoft agreed to make it easier to install other browsers. Nothing was 'thrown out', rather the penalty was changed after the higher court issued a ruling that actually changed the liability implications for MS, which allowed MS to negotiate a lesser judgement. Findings of fact and the ruling were not overthrown, despite questions about judge Jackson's impartiality. Beyond that, the US was not the only jurisdiction in which Microsoft was taken to court and found guilty of monopolistic practices. "DOJ" is meaningless in courts outside the US, so your statement doesn't even make logical sense as a component of your argument. Second - you seem to be standing behind a single dictionary definition for what constitutes a monopoly. That's fine when discussing certain technicalities in abstraction, but completely ignores the fact that the dictionary definition is meaningless in terms of law. A monopoly can absolutely exist even in the presence of competitive options, and that is very clearly laid out in many ways in various laws and legal precedents. The Sherman Act* alone has very clear statements about this, and absolutely contradicts what you are saying. Monopolistic behavior is about controlling the market and/or using market/industry dominance to prevent or stifle competition. It is not about the sheer absence of competition. * https://www.justice.gov/atr/competition-and-monopoly-single-firm-conduct-under-section-2-sherman-act-chapter-2 https://www.justice.gov/atr/competition-and-monopoly-single-...
curryst 6y ago
I would actually argue that social media forms natural monopolies. The network effect creates an enormous advantage for incumbents. > It is technically quite trivial to clone the basic functionality of Twitter and run a competing service. This has been done semi-sucessfully with Gab (not endorsing that community, but it is a good example), for example. People choose social media services based on their perceived value, social prestige, etc. It is quite simple to create software that mimics Twitter, sure. It is very, very hard to create a platform like Twitter. That further reinforces it as a natural monopoly to me. You can even look at how the companies rise and fall; typically if the incumbent fails, they do so entirely, and the new competitor eats all of their lunch (i.e. MySpace and Facebook, Digg/Slashdot/Reddit, etc). There are very rarely situations where a new competitor comes and splits the market share; they either take it all, or they get none. > There's no equivalent to "I have to use Twitter because they own the lines to the house/they have the only 5G coverage in my area/they are the only company licensed by my city." There absolutely is. "I have to use Twitter because that's where everyone I want to talk to is, and they don't allow any interoperation with other social networks." It's fundamentally the same thing, and treating them like a utility would involve forcing them to treat their platform like utility poles. They can charge a fee to the other companies that interoperate to recoup their costs and get some profit, but they have to allow the interoperation.

guscost 6y ago

You could technically set up a mesh network and bypass the ISP too. I don’t think that argument is aging well, since it depends on some essential distinction between “telephone wire” type infrastructure and “server farm” or “installed base” type infrastructure. Why should we assume that a global content management and delivery network, broadcasting 500 million messages every day, is trivially replaceable? The fact is nothing has even come close to replacing it.

nitrogen 6y ago
The fact is nothing has even come close to replacing it. Indeed, it seems that just as there are natural monopolies over physically exclusive infrastructure like roads and cables, there are natural monopolies over network effects and attention/mindshare.
- Meph504 6y ago
  I think the argument on monopoly is getting muddied, a monopoly isn't based on consumer's choosing a preferred service, but that they have no choice of provider. Twitter is popular because people choose to use it, but they have the choice to use other services, or to attempt to create one, and compete with the current popular one, the difficulty of succeeding in the field doesn't change if it is a monopoly (unless of course the service provider can suppress any competitor from entering the market.) Was MySpace a monopoly? it dominated social media at its peak, and not has been completely surpassed.
  - nitrogen 6y ago
    There were other operating systems for PCs besides MS Windows in the 1990s, but Windows was still a monopoly. Yes Myspace was a monopoly until Facebook opened to tbe public because it was the only way a bunch of people were willing to communicate for a while.
    - Meph504 6y ago
      I think you might want to do some double checking on your history. Firstly Microsoft monopoly got thrown out because of unethical behavior of the judge (which is why there isn't two Microsoft entities today. The whole thing hinged on "Microsoft installed its browser by default which gave it an unfair advantage." To allow the DOJ to save face, Microsoft agreed to make it easier to install other browsers. And My Space wasn't a monopoly, there was a parade of social networking sites of various popularity and success starting with bolt in the late 90s and most directly before MySpace was Friendster. Compare these applications, to say power companies, or ISPs in much of the US. The difference is really clear.
      - perrylaj 6y ago
        First - you seem to be misunderstanding (or misrepresenting) the facts and results of the Microsoft case. > Firstly Microsoft monopoly got thrown out because of unethical behavior of the judge (which is why there isn't two Microsoft entities today. The whole thing hinged on "Microsoft installed its browser by default which gave it an unfair advantage." To allow the DOJ to save face, Microsoft agreed to make it easier to install other browsers. Nothing was 'thrown out', rather the penalty was changed after the higher court issued a ruling that actually changed the liability implications for MS, which allowed MS to negotiate a lesser judgement. Findings of fact and the ruling were not overthrown, despite questions about judge Jackson's impartiality. Beyond that, the US was not the only jurisdiction in which Microsoft was taken to court and found guilty of monopolistic practices. "DOJ" is meaningless in courts outside the US, so your statement doesn't even make logical sense as a component of your argument. Second - you seem to be standing behind a single dictionary definition for what constitutes a monopoly. That's fine when discussing certain technicalities in abstraction, but completely ignores the fact that the dictionary definition is meaningless in terms of law. A monopoly can absolutely exist even in the presence of competitive options, and that is very clearly laid out in many ways in various laws and legal precedents. The Sherman Act* alone has very clear statements about this, and absolutely contradicts what you are saying. Monopolistic behavior is about controlling the market and/or using market/industry dominance to prevent or stifle competition. It is not about the sheer absence of competition. * https://www.justice.gov/atr/competition-and-monopoly-single-firm-conduct-under-section-2-sherman-act-chapter-2 https://www.justice.gov/atr/competition-and-monopoly-single-...

curryst 6y ago

I would actually argue that social media forms natural monopolies. The network effect creates an enormous advantage for incumbents. > It is technically quite trivial to clone the basic functionality of Twitter and run a competing service. This has been done semi-sucessfully with Gab (not endorsing that community, but it is a good example), for example. People choose social media services based on their perceived value, social prestige, etc. It is quite simple to create software that mimics Twitter, sure. It is very, very hard to create a platform like Twitter. That further reinforces it as a natural monopoly to me. You can even look at how the companies rise and fall; typically if the incumbent fails, they do so entirely, and the new competitor eats all of their lunch (i.e. MySpace and Facebook, Digg/Slashdot/Reddit, etc). There are very rarely situations where a new competitor comes and splits the market share; they either take it all, or they get none. > There's no equivalent to "I have to use Twitter because they own the lines to the house/they have the only 5G coverage in my area/they are the only company licensed by my city." There absolutely is. "I have to use Twitter because that's where everyone I want to talk to is, and they don't allow any interoperation with other social networks." It's fundamentally the same thing, and treating them like a utility would involve forcing them to treat their platform like utility poles. They can charge a fee to the other companies that interoperate to recoup their costs and get some profit, but they have to allow the interoperation.