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The way antitrust is working in recent years is kind of ridiculous. Google in Europe is becoming a rich case study in antitrust meh. You find that adwords enga

The way antitrust is working in recent years is kind of ridiculous. Google in Europe is becoming a rich case study in antitrust meh. You find that adwords engages in a blatant "monopolistic abuse" in some specific sense. In the Adwords EU case for example, Google was both monopsonising (google search) and monopolising search advertising. But, the actual violations are specific, like exclusivity requirements and other technical infractions buried in their take-it-or-leave-it contracts with "partners.^" Google get a fine. They deny culpability. They pay a fine and move on. Whether it's 100m or 2bn doesn't really matter. Google are demonstrably willing to pay far more (eg acquisition, browser kickbacks, etc.) to maintain a monopolistic position. Besides minor tweaks, there's no reason for them to change. What's the point? Antitrust can't be useful as a violation-fine paradigm. These cases/fines don't affect the monopoly or free the market in any useful sense. IMO, we need some way to declare a company "Big" and apply special rules to them. If those rules are onerous, that might create some organic pressure to split and/or help smaller incumbents compete. There is no point to antitrust if its totally reactive, handing out fines for moving violations. The point of antitrust is trust-busting, to affect market structure. The point if to have a competitive market. All the 1990s stuff is playing out. Just like the MSFT case, we see that operating systems, browsers (now app stores) are monopoly prone and that it's a big deal. On the other side, the 90s "portal" concept is fully realized now. In the digital economy, controlling the windows of consumption is everything. None of the costs, all of the profit... literally all in a lot of cases. ^Newspapers didn't have the advantage search partners had in their monopoly claim, because Google doesn't have agreements with them. No contract, no abusive clauses. The take it or leave it offer is "give us your content for free, or go away." Formally, Google isn't even doing business with them.

oblio 5y ago
> IMO, we need some way to declare a company "Big" and apply special rules to them. If those rules are onerous, that might create some organic pressure to split and/or help smaller incumbents compete. Past a point, they should be regulated like an utility.
- dalbasal 5y ago
  IDK if it's "past a point," but in some cases maybe. I'm torn on that though. EG, what would it actually mean if FB or twitter became "regulated like utilities?" Interoperability? Portability? IMO, these are pretty finicky problems for a regulator. I think it would likely look like the mandated personal data dumps we have today. Some clunky feature that few use, and don't change the structure of the market. Useful transparency, but not really game changing. Regulated equal access? Court-like proceeding to confirm bans? I'm not feeling it. I suspect it will entrench monopolies further. A Telecom or EnergyCo is fundamentally different from a FB or Google. Regulators needed to make sure everyone had access, because it's always more profitable to just exclude certain people/areas. Prices are an issue because infrastructure monopoly. Also because government/regulators typically fund a lot of the capex. There is almost no cost, marginal or fixed, associated with instant messages, shares, likes, links, etc. If Facebook and Twitter folded tomorrow, we would still have plenty of all of these because they are not scarce. Maybe there's a case for cloud computing as a utility, but even here I'm hesitant. Enough with analogies to 19th century monopolies. Platform monopolies should be regulated as platform monopolies, not utilities. New thinking. In any case, google is the perfect target for actual trustbusting. Separate search from adwords and android. Ban default buying. Ban mergers. The old challenge was (eg) trust busting steel without harming the actual production of steel. Today's problem has little to do with production. It does have a lot to do with share prices. Is there really an appetite for turning Alphabet from a $1.5trn company into a $150bn company?
  - ripdog 5y ago
    Generally good comment, but if search is separated from ads, how does it make money? I'm totally on board with splitting up Google, but losing Google search (or search becoming notably worse) would not be worth it for me. The competition is just so bad, and always has been.
    - salawat 5y ago
      Part of why searching is as painful as it is is because it has been deemed acceptable to pollute the search space. SEO should be neither encouraged or allowed. It is nothing less than adversarial corruption of a shared index. Boolean searching works. Go back to a library catalog sometime and be amazed at how quickly you can get relevant results when every Tom, Dick, and Methuseleh aren't shoveling extra irrelevant feces into the index.
supermatt 5y ago
Ive long held that corps should be limited to a single trade category (as per trademarks). I think that change would solve a lot of the complexities that megacorps introduce to the application of legislature.
- dalbasal 5y ago
  I don't agree, but I think it's an example of rules that could be applied selectively to megacorps. Banning supermarkets from selling hot coffee, so to speak, is a problem. It's also a problem on the megacorp scale. If Google wasn't allowed to do gmail, android and such, would we have been better off? That said, if we're only talking about a handful of megacorps, there's no need to be abstract or simple with rules. There are lots of ways to keep them in a lane. Android, Youtube & adwords are great candidates for IPO. Why not force a float? This immediately fixes most of the issues so far demonstrated in court. It compensates AlphaGoog at market rates, preserves an incentive to innovate... Before that though... ban mergers! Reverse merges. The whole foods acquisition is a worrying one. The "multiple" discrepancies between amazon and regular retail is so high that there's an arbitrage-like force pushing towards these acquisitions. Tesla & other auto manufacturers are a similar scenario. Consider this... Acquiring the entire publicly traded retail sector would dilute Amazon's shares by circa 25%-50%, most of that going to Walmart and Costco. They could buy the fashion/apparel industry with petty cash. They could acquire UPS. That would make other online retailers compete with amazon like Google competes with its search partners... same logic as amazon marketplace, but more.
ocdtrekkie 5y ago
The fix isn't the fines, it's the requirement to stop given behaviors. Google won't care about the fine it just got, sure, but it also can't block competing apps in this way again, at least in this jurisdiction. It's a small victory, but it's also a hole in the armor. One of many, as various antitrust cases handle various abuses. Unfortunately, progress is slow but we're making it.
Lutzb 5y ago
The fix is not fines. Threat to split the company.
- maxwell 5y ago
  Splitting up companies increases the value of the "babies", and doesn't prevent reforming, as with AT&T and Standard Oil. What about revoking corporate charters and nationalizing? I'm against capital punishment (due to the possibility of wrongful convictions), but if corporations want to be people, let's start executing them. Shut 'em down, Uncle Sam takes the assets.
- AshamedCaptain 5y ago
  Force the company to issue more shares and give them to the government.
JI00912 5y ago
> IMO, we need some way to declare a company "Big" and apply special rules to them. Careful though. A monopoly may abuse its position, which is bad, but a big company may be big because they are good and people use them, which is good.
- kyrra 5y ago
  This is actually the difference between the US and the EU when it comes to monopoly lawsuits. The US has to prove that the behavior of a monopoly was harmful to customers/consumers. The EU has no burden of proof and can just take market size as a way to go after them. The general problem I see here is how you slice the market to say a given company has a monopoly. It sometimes feels like those going after large companies try to slice the market in such as way to say they are monopolies, when other slice it in another way to show that it's not. Which slicing is "correct" is really hard, especially when markets shift relatively quickly.
  - anoncake 5y ago
    Monopolies are inherently harmful to the customer. A monopoly implies lack of competition. If lack of competition is not harmful to the customer, then competition is not beneficial. If competition is not beneficial in a given market, there is no reason for it to be a market to begin with and the monopoly should be expropriated.
    - kyrra 5y ago
      > Monopolies are inherently harmful to the customer. A monopoly implies lack of competition. I disagree. When you look at a company that is dominant in some part of the marketplace at a given point it time, you need to understand how they got there. The monopoly poster child Standard Oil rose-up when there used to be many more oil processing companies, but Standard Oil was able to do things for cheaper because they used more byproducts from the oil to create different products (which let them sell things like lamp oil for less). So sometimes monopolies rise-up because that one company is able to fill a market segment better than the competition. The question then becomes, once they have a monopoly and others see this, how can potential competitors react. Can others copy (and improve) the same processing system that the monopoly has to produce a similar product for a similar price (maybe even less)? If so, then they can rise up and the original company will no longer be a monopoly. But if that original company takes steps to squelch the competition, you start getting into what the US has defined as "anti competitive" practices. These were developed because the past showed us that this leads to harming consumers. We also have a lot of government granted monopolies. Copyright and IP law are time-limited monopolies on a given product. We have private business that operate on federal land (like national parks) that may be given a local monopoly within that region. Sometimes we make tradeoffs and grant monopolies.
cblconfederate 5y ago
Google doesn't really have a choice. Their monetization model rests on providing increasingly complicated dashboards to lure advertisers into believing their money is well spent. As long as they haven't found an alternative model they will just blindly pay up and redo
fouric 5y ago
> Whether it's 100m or 2bn doesn't really matter. ...yet, it will absolutely matter if it's $20B - Google's 2020 operating income was $41B. You're making the claim that since Google wasn't fined enough, fines don't work - which is absurd. Try making the fines a reasonably large percentage of gross revenue from the previous year - say, 10%. 10% of Google's 2020 gross revenue ($182B) is $18B, which is almost half of their operating income. That will have an effect.
- qubex 5y ago
  The problem with this is that you can easily bankrupt a company by codifying exceedingly onerous terms. Google (to take your example) happens to be able to (barely) afford 10% of their revenue taken from their income. Another company with a different cost structure (perhaps in another sector) might not be able to afford that. The upshot is that providing a codified “one size fits all” punishment could be disastrous (if you consider preserving companies to be desirable: for the sake of this argument I do, but entirely legitimately you might not). In the case of Italy (I’m Italian) and it’s awkward, glacial justice system, that’s a very dangerous assumption to make. This place is already hostile enough towards businesses.
- dalbasal 5y ago
  ...maybe in theory. Fines are, largely calibrated one way or another. It's not marked to gross revenue... but it is usually marked to the infraction. In the EU-Adwords case, the $2bn fine was relative to the size of adwords search partners' EU market share. In this Italian case (I assume) the fine is scaled to the size of the monopolised sector... Italian apps or whatnot. This is why I called it a "violation-fine paradigm." Courts can't arbitrarily fine companies "enough to make it hurt." It has to relate to laws, specific infractions. Laws have to be general. Etc. My point is that the infraction itself is not the problem. It's a sign of the problem, a symptom... the problem is monopoly. There's no version of adwords partner agreement (including the post-fine version) that isn't still a problem, even if it doesn't contain abuse of power clauses. The problem is that the only meaningful market for search ads is Google's. Similar issue for Amazon marketplace. There's no version of Amazon marketplace policies where amazon retail competes on a level playing field... they own the field. You fine a company for doing something wrong. Google do things wrong, from time to time... but the main problem is what Google is, not what they do. That's derivative.
thegrimmest 5y ago
> IMO, we need some way to declare a company "Big" and apply special rules to them. If those rules are onerous, that might create some organic pressure to split and/or help smaller incumbents compete. What do we win here? To me it seems that letting big companies get as big as they can allows them to use economies of scale to provide quality services cheaply to all of us. Search is a prime example here, only Google seems to be able to do it as well as they do. Many others have tried and failed. Isn't the benefit of cheap/free services far outweighed by whatever arbitrary "abuses" that are alleged to have been perpetrated? Shouldn't our attitude be primarily of bewildered amazement at the status quo instead of attempting to micromanage how Google uses the massive, amazingly positive platform it built?
- asddubs 5y ago
  >What do we win here? a more balanced power dynamic
  - thegrimmest 5y ago
    Between who? And at the expense of cheap, readily available, quality services?
    - asddubs 5y ago
      between regular people and companies. I don't think it has to come at the expense of those things, a company doesn't have to be the size and scope of google to be efficient.
      - thegrimmest 5y ago
        Companies are made up of regular people, there is no clear distinction between the two. Efficiency is a spectrum, the more efficient a company, the more the poorest of us benefit from cheaper services. Capping efficiency punishes everyone.
        5y ago

oblio 5y ago

dalbasal 5y ago
IDK if it's "past a point," but in some cases maybe. I'm torn on that though. EG, what would it actually mean if FB or twitter became "regulated like utilities?" Interoperability? Portability? IMO, these are pretty finicky problems for a regulator. I think it would likely look like the mandated personal data dumps we have today. Some clunky feature that few use, and don't change the structure of the market. Useful transparency, but not really game changing. Regulated equal access? Court-like proceeding to confirm bans? I'm not feeling it. I suspect it will entrench monopolies further. A Telecom or EnergyCo is fundamentally different from a FB or Google. Regulators needed to make sure everyone had access, because it's always more profitable to just exclude certain people/areas. Prices are an issue because infrastructure monopoly. Also because government/regulators typically fund a lot of the capex. There is almost no cost, marginal or fixed, associated with instant messages, shares, likes, links, etc. If Facebook and Twitter folded tomorrow, we would still have plenty of all of these because they are not scarce. Maybe there's a case for cloud computing as a utility, but even here I'm hesitant. Enough with analogies to 19th century monopolies. Platform monopolies should be regulated as platform monopolies, not utilities. New thinking. In any case, google is the perfect target for actual trustbusting. Separate search from adwords and android. Ban default buying. Ban mergers. The old challenge was (eg) trust busting steel without harming the actual production of steel. Today's problem has little to do with production. It does have a lot to do with share prices. Is there really an appetite for turning Alphabet from a $1.5trn company into a $150bn company?
- ripdog 5y ago
  Generally good comment, but if search is separated from ads, how does it make money? I'm totally on board with splitting up Google, but losing Google search (or search becoming notably worse) would not be worth it for me. The competition is just so bad, and always has been.
  - salawat 5y ago
    Part of why searching is as painful as it is is because it has been deemed acceptable to pollute the search space. SEO should be neither encouraged or allowed. It is nothing less than adversarial corruption of a shared index. Boolean searching works. Go back to a library catalog sometime and be amazed at how quickly you can get relevant results when every Tom, Dick, and Methuseleh aren't shoveling extra irrelevant feces into the index.

supermatt 5y ago

Ive long held that corps should be limited to a single trade category (as per trademarks). I think that change would solve a lot of the complexities that megacorps introduce to the application of legislature.

dalbasal 5y ago
I don't agree, but I think it's an example of rules that could be applied selectively to megacorps. Banning supermarkets from selling hot coffee, so to speak, is a problem. It's also a problem on the megacorp scale. If Google wasn't allowed to do gmail, android and such, would we have been better off? That said, if we're only talking about a handful of megacorps, there's no need to be abstract or simple with rules. There are lots of ways to keep them in a lane. Android, Youtube & adwords are great candidates for IPO. Why not force a float? This immediately fixes most of the issues so far demonstrated in court. It compensates AlphaGoog at market rates, preserves an incentive to innovate... Before that though... ban mergers! Reverse merges. The whole foods acquisition is a worrying one. The "multiple" discrepancies between amazon and regular retail is so high that there's an arbitrage-like force pushing towards these acquisitions. Tesla & other auto manufacturers are a similar scenario. Consider this... Acquiring the entire publicly traded retail sector would dilute Amazon's shares by circa 25%-50%, most of that going to Walmart and Costco. They could buy the fashion/apparel industry with petty cash. They could acquire UPS. That would make other online retailers compete with amazon like Google competes with its search partners... same logic as amazon marketplace, but more.

ocdtrekkie 5y ago

The fix isn't the fines, it's the requirement to stop given behaviors. Google won't care about the fine it just got, sure, but it also can't block competing apps in this way again, at least in this jurisdiction. It's a small victory, but it's also a hole in the armor. One of many, as various antitrust cases handle various abuses. Unfortunately, progress is slow but we're making it.

Lutzb 5y ago

The fix is not fines. Threat to split the company.

maxwell 5y ago
Splitting up companies increases the value of the "babies", and doesn't prevent reforming, as with AT&T and Standard Oil. What about revoking corporate charters and nationalizing? I'm against capital punishment (due to the possibility of wrongful convictions), but if corporations want to be people, let's start executing them. Shut 'em down, Uncle Sam takes the assets.
AshamedCaptain 5y ago
Force the company to issue more shares and give them to the government.

JI00912 5y ago

> IMO, we need some way to declare a company "Big" and apply special rules to them. Careful though. A monopoly may abuse its position, which is bad, but a big company may be big because they are good and people use them, which is good.

kyrra 5y ago
This is actually the difference between the US and the EU when it comes to monopoly lawsuits. The US has to prove that the behavior of a monopoly was harmful to customers/consumers. The EU has no burden of proof and can just take market size as a way to go after them. The general problem I see here is how you slice the market to say a given company has a monopoly. It sometimes feels like those going after large companies try to slice the market in such as way to say they are monopolies, when other slice it in another way to show that it's not. Which slicing is "correct" is really hard, especially when markets shift relatively quickly.
- anoncake 5y ago
  Monopolies are inherently harmful to the customer. A monopoly implies lack of competition. If lack of competition is not harmful to the customer, then competition is not beneficial. If competition is not beneficial in a given market, there is no reason for it to be a market to begin with and the monopoly should be expropriated.
  - kyrra 5y ago
    > Monopolies are inherently harmful to the customer. A monopoly implies lack of competition. I disagree. When you look at a company that is dominant in some part of the marketplace at a given point it time, you need to understand how they got there. The monopoly poster child Standard Oil rose-up when there used to be many more oil processing companies, but Standard Oil was able to do things for cheaper because they used more byproducts from the oil to create different products (which let them sell things like lamp oil for less). So sometimes monopolies rise-up because that one company is able to fill a market segment better than the competition. The question then becomes, once they have a monopoly and others see this, how can potential competitors react. Can others copy (and improve) the same processing system that the monopoly has to produce a similar product for a similar price (maybe even less)? If so, then they can rise up and the original company will no longer be a monopoly. But if that original company takes steps to squelch the competition, you start getting into what the US has defined as "anti competitive" practices. These were developed because the past showed us that this leads to harming consumers. We also have a lot of government granted monopolies. Copyright and IP law are time-limited monopolies on a given product. We have private business that operate on federal land (like national parks) that may be given a local monopoly within that region. Sometimes we make tradeoffs and grant monopolies.

cblconfederate 5y ago

Google doesn't really have a choice. Their monetization model rests on providing increasingly complicated dashboards to lure advertisers into believing their money is well spent. As long as they haven't found an alternative model they will just blindly pay up and redo

fouric 5y ago

> Whether it's 100m or 2bn doesn't really matter. ...yet, it will absolutely matter if it's $20B - Google's 2020 operating income was $41B. You're making the claim that since Google wasn't fined enough, fines don't work - which is absurd. Try making the fines a reasonably large percentage of gross revenue from the previous year - say, 10%. 10% of Google's 2020 gross revenue ($182B) is $18B, which is almost half of their operating income. That will have an effect.

qubex 5y ago
The problem with this is that you can easily bankrupt a company by codifying exceedingly onerous terms. Google (to take your example) happens to be able to (barely) afford 10% of their revenue taken from their income. Another company with a different cost structure (perhaps in another sector) might not be able to afford that. The upshot is that providing a codified “one size fits all” punishment could be disastrous (if you consider preserving companies to be desirable: for the sake of this argument I do, but entirely legitimately you might not). In the case of Italy (I’m Italian) and it’s awkward, glacial justice system, that’s a very dangerous assumption to make. This place is already hostile enough towards businesses.
dalbasal 5y ago
...maybe in theory. Fines are, largely calibrated one way or another. It's not marked to gross revenue... but it is usually marked to the infraction. In the EU-Adwords case, the $2bn fine was relative to the size of adwords search partners' EU market share. In this Italian case (I assume) the fine is scaled to the size of the monopolised sector... Italian apps or whatnot. This is why I called it a "violation-fine paradigm." Courts can't arbitrarily fine companies "enough to make it hurt." It has to relate to laws, specific infractions. Laws have to be general. Etc. My point is that the infraction itself is not the problem. It's a sign of the problem, a symptom... the problem is monopoly. There's no version of adwords partner agreement (including the post-fine version) that isn't still a problem, even if it doesn't contain abuse of power clauses. The problem is that the only meaningful market for search ads is Google's. Similar issue for Amazon marketplace. There's no version of Amazon marketplace policies where amazon retail competes on a level playing field... they own the field. You fine a company for doing something wrong. Google do things wrong, from time to time... but the main problem is what Google is, not what they do. That's derivative.

thegrimmest 5y ago

> IMO, we need some way to declare a company "Big" and apply special rules to them. If those rules are onerous, that might create some organic pressure to split and/or help smaller incumbents compete. What do we win here? To me it seems that letting big companies get as big as they can allows them to use economies of scale to provide quality services cheaply to all of us. Search is a prime example here, only Google seems to be able to do it as well as they do. Many others have tried and failed. Isn't the benefit of cheap/free services far outweighed by whatever arbitrary "abuses" that are alleged to have been perpetrated? Shouldn't our attitude be primarily of bewildered amazement at the status quo instead of attempting to micromanage how Google uses the massive, amazingly positive platform it built?

asddubs 5y ago
>What do we win here? a more balanced power dynamic
- thegrimmest 5y ago
  Between who? And at the expense of cheap, readily available, quality services?
  - asddubs 5y ago
    between regular people and companies. I don't think it has to come at the expense of those things, a company doesn't have to be the size and scope of google to be efficient.
    - thegrimmest 5y ago
      Companies are made up of regular people, there is no clear distinction between the two. Efficiency is a spectrum, the more efficient a company, the more the poorest of us benefit from cheaper services. Capping efficiency punishes everyone.
      - 5y ago