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We are talking about the big tech companies... Name one that is an ACTUAL monopoly? Facebook? Apple? Google? Amazon? Vertical integration is NOT monopoly, and

We are talking about the big tech companies... Name one that is an ACTUAL monopoly? Facebook? Apple? Google? Amazon? Vertical integration is NOT monopoly, and thats what many of them are doing. I see a lot of arguments about these companies that are tantamount to "I didn't know how the world worked till I saw them do it and now I'm unhappy". After starting to dig a bit further than this article into what some of these would contain, someone with some tech savvy needs to get themselves to the capital and educate our legislators.

mtkhaos 5y ago
Better phrasing now a days is the elimination of middle man industries in favor of public infrastructure projects. As ultimately what these companies represent is toll road to the content others create. As what these companies do is common sense. My own father created what became the modern search paradigm and was subsequently kicked off the project that later became yahoo. So from my perspective what these companies do is not innovative.
cortesoft 5y ago
You don't need to have a full monopoly to be considered a monopoly under the law in the United States. You can be considered a legal monopoly if you have significant market power and can charge overly high prices for things. https://en.wikipedia.org/wiki/Monopoly https://en.wikipedia.org/wiki/Monopoly
- bawolff 5y ago
  Hard to charge overly high price for something that is free.
  - ethbr0 5y ago
    Free service -> non-free infrastructure / development -> corporate revenue -> who's really paying In this case, it's advertisers. Which is why all the antitrust suits are brought "for" the ad industry.
    - missedthecue 5y ago
      But aren't the ad prices derived by live auction? It's not as if Facebook is pricing above market equilibrium to extract monopoly rents.
      - ethbr0 5y ago
        That Facebook, or Google, sells ad pricing via a live auction doesn't opine on whether that results in overcharging. The mere fact that participation is effectively mandatory itself skews the market.
        missedthecue 5y ago
        Most things we buy are effectively mandatory though. Food, shelter, water, clothing, medicine, and so on and so forth. That can't be the criteria for breaking up a company, which in Facebooks case basically means making them spin Whatsapp and Instagram. (But the management and most of the owners stay the same, mind you)
        ethbr0 5y ago
        Mandatory to buy, but available from a choice of competitors with adversarial interests to each other. IMHO, an adversarial bidding process (under control of one party) is no replacement for a strategic adversary (capable of planning and executing strategy). The former may prevent the most egregious price raises, but it's insufficient for creating the broader competition that ultimately drives prices down.
      - webmaven 5y ago
        > But aren't the ad prices derived by live auction? It's not as if Facebook is pricing above market equilibrium to extract monopoly rents. There is a peculiar dynamic as the market centralizes toward fewer marketplaces (for example two-sided ones like AdWords) such that buyers have to go there to find sellers and vice-versa, that results in sellers getting stuck in a race to the bottom, while buyers are stuck in a race to the top. It's like the dark mirror of the network effect. The market maker gets to siphon off the growing gap as fees of various sorts. Voila, monopoly rents. FB isn't a two sided marketplace, but buyers are definitely stuck bidding against each other which causes the market equilibrium to rise. And even if you broaden the definition of the market fairly generously such that FB doesn't have a monopoly per-se, you've still got an oligopoly at best.
- deleted 5y ago
  [deleted]
elzbardico 5y ago
Instagram was a probable competitor for Facebook. Facebook bought it. Facebook was feeling threatened by the success of WhatsApp on instant messaging? bought. if it doesn't look to you like a monopoly, or at least something seriously and credibly moving to become a monopoly, by the time they meet your criteria, it would be too late to do anything about it.
- dean177 5y ago
  When Instagram was purchased by Facebook it was not viewed as a competitor at all, it was widely viewed as a terrible decision with FB massively overpaying.
  - ethbr0 5y ago
    I'm not sure how this cuts against the claim. In this case, wide views at the time were wrong, and Facebook knew lighting money on fire was worth it... if it kept the spigot flowing.
  - nl 5y ago
    The only people who thought FB overpaid for Instagram were the same people who complained that FB wasn't a real business and was going to collapse at any moment. Ironically many of these people were HN commentators. Anyone who worked in the space thought it was the most desirable property available, and wasn't surprised at the price given that Google was looking at social properties at the time too. And no matter what people on HN thought, FB did buy Insta because it was a competitor: The exchange was one of several potentially damning pieces of evidence in documents obtained by the U.S. House Judiciary subcommittee on antitrust, showing that Zuckerberg leveraged Facebook’s market power over competitors and bought Instagram because he was concerned about the fast growing company’s potential to turn users away from Facebook. https://www.livemint.com/companies/news/facebook-bought-instagram-to-quash-competitor-documents-show-11596068397572.html https://www.livemint.com/companies/news/facebook-bought-inst...
CodeMage 5y ago
> I see a lot of arguments about these companies that are tantamount to "I didn't know how the world worked till I saw them do it and now I'm unhappy". Just out of curiosity: which aspect of those arguments do you object to, if any? I'm not trying to be confrontational, just trying to understand your point of view. There was a time where monopolies were "how the world worked", until the society collectively decided that it's not how the world should work. If Google and Amazon aren't actual monopolies, then maybe we need a new name and a new set of rules.
caymanjim 5y ago
When Standard Oil was broken up, it wasn't a 100% monopoly. Nor was AT&T. I'm not sure what your criteria are, but if you're just being pedantic, it doesn't seem to have any historical bearing. The great monopolies of US history that prompted legal change never had complete control. They just had de facto control due to outsized influence and predatory (or at least anticompetitive) behavior.
- missedthecue 5y ago
  Standard Oil once had 90% market share, but by the time they were broken up, they had only ~60% market share.
ergot_vacation 5y ago
Ah yes, Amazon isn't a monopoly. That's why I often use the alternative online shopping site that has nearly every mass-produced item imaginable at low prices and low or free shipping. Same with Facebook: it's good thing there's that competitor of theirs that nearly everyone is on, catching up, organizing local events, buying and selling stuff. And man, I don't know where I would be without that other Internet search engine that rapidly and intelligently indexes almost everything online as soon as it's up and has been so fine-tuned over more than a decade that it has an almost psychic ability to correctly interpret even the most vague, misspelled and deranged search queries. It's truly amazing that humanity managed to make such a wonder of technology not just once, but twice! Really, I don't know what the lawmakers are thinking. Competition is alive and well on the Internet! Innovation has never been higher! Absolutely nothing has gotten worse since 2008! Boy I can't wait for the next version of Firefox. It totally won't be even more like Chrome this time.
- pitaj 5y ago
  > That's why I often use the alternative online shopping site that has nearly every mass-produced item imaginable at low prices and low or free shipping. If you put enough qualifiers on something you can make anything one-of-a-kind.
_-david-_ 5y ago
Google has some where around 80% of the search market in the US which is possibly enough to qualify as a monopoly.
- TchoBeer 5y ago
  Is this because they're a monopoly or because they're better than the competition?
  - _-david-_ 5y ago
    I'm not sure what you mean? It is completely possible for a company with a superior product to be a monopoly. Google has a large market share because their products are generally better than their competitors.
    - TchoBeer 5y ago
      It's possible for a company with a superior product to be a monopoly, and it's also possible for a company with a majority share in the market to not be a monopoly.
throwaway894345 5y ago
> Name one that is an ACTUAL monopoly? Facebook? Apple? Google? Amazon? Vertical integration is NOT monopoly, and thats what many of them are doing. I think we should be less interested in whether these companies are literal monopolies and more interested in whether these companies represent a net harm to society (or even more narrowly, to their respective competitive landscapes). I don’t posit an answer, but I think this criteria will lead to more fruitful discussion than the fixation on monopoly.
gentleman11 5y ago
For any of those companies besides apple, imagine setting the goal of never using one of the company’s services and of “escaping their grasp”. Aws runs most of the cloud and your local bookstores closed years ago so where do you get books? Everyone you email uses google. Facebook tracks everything you do even if you’re not a user. You can’t get away unless your life depended on it
xbmcuser 5y ago
Today the patterns that big tech companies are following is the same as the so called train robber barons in the past. Use your monopoly or control in 1 thing to horn in on other businesses by subsidising .
bww 5y ago
It doesn’t really matter whether any of these companies are monopolies in the Sherman Act sense. That act was passed about 130 years ago and could never have possibly envisioned the challenges presented by tech companies today. What does matter is that these companies are very much engaged in the behaviors these bills would regulate. The point of the legislature is not to sit around and observe why a century-old law doesn’t technically apply to a modern problem, it’s to make a new law that does apply. I don’t have an opinion on whether these bills are a good idea or not (although I definitely think big tech need some reining in). But whether or not these companies are technically monopolies has nothing to do with it beyond a bit of political rhetoric.

mtkhaos 5y ago

Better phrasing now a days is the elimination of middle man industries in favor of public infrastructure projects. As ultimately what these companies represent is toll road to the content others create. As what these companies do is common sense. My own father created what became the modern search paradigm and was subsequently kicked off the project that later became yahoo. So from my perspective what these companies do is not innovative.

cortesoft 5y ago

You don't need to have a full monopoly to be considered a monopoly under the law in the United States. You can be considered a legal monopoly if you have significant market power and can charge overly high prices for things. https://en.wikipedia.org/wiki/Monopoly https://en.wikipedia.org/wiki/Monopoly

bawolff 5y ago
Hard to charge overly high price for something that is free.
- ethbr0 5y ago
  Free service -> non-free infrastructure / development -> corporate revenue -> who's really paying In this case, it's advertisers. Which is why all the antitrust suits are brought "for" the ad industry.
  - missedthecue 5y ago
    But aren't the ad prices derived by live auction? It's not as if Facebook is pricing above market equilibrium to extract monopoly rents.
    - ethbr0 5y ago
      That Facebook, or Google, sells ad pricing via a live auction doesn't opine on whether that results in overcharging. The mere fact that participation is effectively mandatory itself skews the market.
      - missedthecue 5y ago
        Most things we buy are effectively mandatory though. Food, shelter, water, clothing, medicine, and so on and so forth. That can't be the criteria for breaking up a company, which in Facebooks case basically means making them spin Whatsapp and Instagram. (But the management and most of the owners stay the same, mind you)
        ethbr0 5y ago
        Mandatory to buy, but available from a choice of competitors with adversarial interests to each other. IMHO, an adversarial bidding process (under control of one party) is no replacement for a strategic adversary (capable of planning and executing strategy). The former may prevent the most egregious price raises, but it's insufficient for creating the broader competition that ultimately drives prices down.
    - webmaven 5y ago
      > But aren't the ad prices derived by live auction? It's not as if Facebook is pricing above market equilibrium to extract monopoly rents. There is a peculiar dynamic as the market centralizes toward fewer marketplaces (for example two-sided ones like AdWords) such that buyers have to go there to find sellers and vice-versa, that results in sellers getting stuck in a race to the bottom, while buyers are stuck in a race to the top. It's like the dark mirror of the network effect. The market maker gets to siphon off the growing gap as fees of various sorts. Voila, monopoly rents. FB isn't a two sided marketplace, but buyers are definitely stuck bidding against each other which causes the market equilibrium to rise. And even if you broaden the definition of the market fairly generously such that FB doesn't have a monopoly per-se, you've still got an oligopoly at best.
deleted 5y ago
[deleted]

elzbardico 5y ago

Instagram was a probable competitor for Facebook. Facebook bought it. Facebook was feeling threatened by the success of WhatsApp on instant messaging? bought. if it doesn't look to you like a monopoly, or at least something seriously and credibly moving to become a monopoly, by the time they meet your criteria, it would be too late to do anything about it.

dean177 5y ago
When Instagram was purchased by Facebook it was not viewed as a competitor at all, it was widely viewed as a terrible decision with FB massively overpaying.
- ethbr0 5y ago
  I'm not sure how this cuts against the claim. In this case, wide views at the time were wrong, and Facebook knew lighting money on fire was worth it... if it kept the spigot flowing.
- nl 5y ago
  The only people who thought FB overpaid for Instagram were the same people who complained that FB wasn't a real business and was going to collapse at any moment. Ironically many of these people were HN commentators. Anyone who worked in the space thought it was the most desirable property available, and wasn't surprised at the price given that Google was looking at social properties at the time too. And no matter what people on HN thought, FB did buy Insta because it was a competitor: The exchange was one of several potentially damning pieces of evidence in documents obtained by the U.S. House Judiciary subcommittee on antitrust, showing that Zuckerberg leveraged Facebook’s market power over competitors and bought Instagram because he was concerned about the fast growing company’s potential to turn users away from Facebook. https://www.livemint.com/companies/news/facebook-bought-instagram-to-quash-competitor-documents-show-11596068397572.html https://www.livemint.com/companies/news/facebook-bought-inst...

CodeMage 5y ago

> I see a lot of arguments about these companies that are tantamount to "I didn't know how the world worked till I saw them do it and now I'm unhappy". Just out of curiosity: which aspect of those arguments do you object to, if any? I'm not trying to be confrontational, just trying to understand your point of view. There was a time where monopolies were "how the world worked", until the society collectively decided that it's not how the world should work. If Google and Amazon aren't actual monopolies, then maybe we need a new name and a new set of rules.

caymanjim 5y ago

When Standard Oil was broken up, it wasn't a 100% monopoly. Nor was AT&T. I'm not sure what your criteria are, but if you're just being pedantic, it doesn't seem to have any historical bearing. The great monopolies of US history that prompted legal change never had complete control. They just had de facto control due to outsized influence and predatory (or at least anticompetitive) behavior.

missedthecue 5y ago
Standard Oil once had 90% market share, but by the time they were broken up, they had only ~60% market share.

ergot_vacation 5y ago

Ah yes, Amazon isn't a monopoly. That's why I often use the alternative online shopping site that has nearly every mass-produced item imaginable at low prices and low or free shipping. Same with Facebook: it's good thing there's that competitor of theirs that nearly everyone is on, catching up, organizing local events, buying and selling stuff. And man, I don't know where I would be without that other Internet search engine that rapidly and intelligently indexes almost everything online as soon as it's up and has been so fine-tuned over more than a decade that it has an almost psychic ability to correctly interpret even the most vague, misspelled and deranged search queries. It's truly amazing that humanity managed to make such a wonder of technology not just once, but twice! Really, I don't know what the lawmakers are thinking. Competition is alive and well on the Internet! Innovation has never been higher! Absolutely nothing has gotten worse since 2008! Boy I can't wait for the next version of Firefox. It totally won't be even more like Chrome this time.

pitaj 5y ago
> That's why I often use the alternative online shopping site that has nearly every mass-produced item imaginable at low prices and low or free shipping. If you put enough qualifiers on something you can make anything one-of-a-kind.

_-david-_ 5y ago

Google has some where around 80% of the search market in the US which is possibly enough to qualify as a monopoly.

TchoBeer 5y ago
Is this because they're a monopoly or because they're better than the competition?
- _-david-_ 5y ago
  I'm not sure what you mean? It is completely possible for a company with a superior product to be a monopoly. Google has a large market share because their products are generally better than their competitors.
  - TchoBeer 5y ago
    It's possible for a company with a superior product to be a monopoly, and it's also possible for a company with a majority share in the market to not be a monopoly.

throwaway894345 5y ago

> Name one that is an ACTUAL monopoly? Facebook? Apple? Google? Amazon? Vertical integration is NOT monopoly, and thats what many of them are doing. I think we should be less interested in whether these companies are literal monopolies and more interested in whether these companies represent a net harm to society (or even more narrowly, to their respective competitive landscapes). I don’t posit an answer, but I think this criteria will lead to more fruitful discussion than the fixation on monopoly.

gentleman11 5y ago

For any of those companies besides apple, imagine setting the goal of never using one of the company’s services and of “escaping their grasp”. Aws runs most of the cloud and your local bookstores closed years ago so where do you get books? Everyone you email uses google. Facebook tracks everything you do even if you’re not a user. You can’t get away unless your life depended on it

xbmcuser 5y ago

Today the patterns that big tech companies are following is the same as the so called train robber barons in the past. Use your monopoly or control in 1 thing to horn in on other businesses by subsidising .

bww 5y ago

It doesn’t really matter whether any of these companies are monopolies in the Sherman Act sense. That act was passed about 130 years ago and could never have possibly envisioned the challenges presented by tech companies today. What does matter is that these companies are very much engaged in the behaviors these bills would regulate. The point of the legislature is not to sit around and observe why a century-old law doesn’t technically apply to a modern problem, it’s to make a new law that does apply. I don’t have an opinion on whether these bills are a good idea or not (although I definitely think big tech need some reining in). But whether or not these companies are technically monopolies has nothing to do with it beyond a bit of political rhetoric.