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This is a solved problem. Just do what most American cities do with other natural monopolies like utilities: use careful price controls to cap margins and slow

This is a solved problem. Just do what most American cities do with other natural monopolies like utilities: use careful price controls to cap margins and slow rate increases. You don't need to invent some esoteric market-based solution, especially for a service where marginal costs are near zero and supply is almost infinite.

jdhzzz 5y ago
Make them a (common carrier)[https://en.wikipedia.org/wiki/Common_carrier https://en.wikipedia.org/wiki/Common_carrier] just like was done for WAN access in the USA. Hahahahahaha.
kortilla 5y ago
Absolutely not a solved problem. The utilities have no reason to innovate at that point. In my local municipality I have no way to choose renewable energy apart from building my own power plant on my roof. That’s a complete failure of these government granted monopolies.
- 8note 5y ago
  What incentive does the app store have to innovate now?
- spywaregorilla 5y ago
  There's no such thing as choosing renewable energy on a grid. Energy is fungible. If you get on one of those "choose green" schemes, you're just getting the same energy but also buying some credits from somewhere else.
- enjo 5y ago
  The regulating bodies of those utilities work hard to create incentives for them to innovate. I spent four years of my career working on energy programs with major utilities around the country in which they tried to incentive reductions in energy usage. Which is a curious statement: why would a electrical utility want people to use less electricity? The reason is because the regulatory agencies created incentives within the regulatory framework to encourage them to do it. Basically the regulators start with an outcome, bake that outcome into how utilities get paid, and then let the utility innovate to figure out how to do it. This led to meaningful reduction in energy usage across many markets.
  - verdagon 5y ago
    I'd love to hear more, what kinds of incentives? Is it something like, "if you get X efficiency, you get N more dollars"?
    - enjo 5y ago
      There are a bunch of different models but they mostly come down to the regulatory agency (IE: the PUC) creating a pot of money for utilities that is paid out when they reach energy reduction goals. You can learn more by looking into Demand Response programs and Demand Management programs around the country.
- tehjoker 5y ago
  It's not something that should be a choice. The government should move as much power to renewable as fast as possible and you should just keep getting power. This idea of "choice" for a commodity based on how it was produced not based on any features is crazy and will never work.
- rhizome 5y ago
  What's wrong with your local power provider not incorporating renewables? There are still solar installers, and it probably a better deal overall to own your own plant, as it were.
kevin_thibedeau 5y ago
My city recently forced every resident into an esoteric market-based solution for electricity (sold with a pack of lies about renewable energy and reduced rates) that required explicit opt-out to avoid and stay with the provider who actually generates power and services the people on its infrastructure.
- Scoundreller 5y ago
  Which city?
liquidify 5y ago
It is not a 'solved problem'. Price controls are not easy for anyone to manage. Companies can easily find ways around them in many cases. Enabling companies to categorize themselves as 'platforms' or otherwise and then stipulating both benefits and requirements based on those labels makes a lot of sense comparatively. The general problem though is that the government isn't typically using regulations to improve freedom and competition. The government looks at regulation as a way to extract money, so solutions that encourage competition on a level playing field through market forces (like OP's) aren't given fair consideration.
AnthonyMouse 5y ago
> Just do what most American cities do with other natural monopolies like utilities: use careful price controls to cap margins and slow rate increases. Nothing Apple does is a natural monopoly. Artificial monopolies can be maintained through vertical integration. If you don't like their app store, use another one. If all they provide is the app store, that's easy, and every platform would have half a dozen or more. But if using a different app store requires you to develop your own operating system, and convince millions of third party developers to make applications for it even before it has any users, and make your own hardware, on and on, well then it's infeasible to make a competing app store and you get an uncompetitive and abusive market. The solution there isn't to regulate it like a utility, it's to break up the company so that the operating system isn't made by the same company as the app store and has no reason to restrict the users to only the one. Then you have competition again and don't need any regulation other than the constraint on vertical integration.
- atdrummond 5y ago
  What is relevant is that the App Store is a natural monopoly within the iOS ecosystem. As long as Apple has such significant market power (including a substantial market share, especially as a percentage of revenue, not just units sold) their natural monopoly on the iOS platform will extend to them being a willing participant in an oligopoly. Said state of affairs is the expected outcome of Apple having a natural monopoly and there being only one other substantial mobile OS market participant, who just so happens to also operate a natural monopoly for app sales - albeit a much, much more tenuous one.
  - shakna 5y ago
    > What is relevant is that the App Store is a natural monopoly within the iOS ecosystem. That's very much not a natural monopoly, but a constraint that is forced onto the ecosystem by Apple. There is no technical reason for it existing, but it exists by design.
barry-cotter 5y ago
There's no historical evidence of natural monopolies existing at the scale of cities. There are multiple American examples of decades long competition in utilities. The economic rationale for politicians to give their friends local monopolies long postdates the practice of doing so. > The Myth of Natural Monopoly > Most so-called public utilities have been granted governmental franchise monopolies because they are thought to be "natural monopolies." Put simply, a natural monopoly is said to occur when production technology, such as relatively high fixed costs, causes long-run average total costs to decline as output expands. In such industries, the theory goes, a single producer will eventually be able to produce at a lower cost than any two other producers, thereby creating a "natural" monopoly. Higher prices will result if more than one producer supplies the market. > Furthermore, competition is said to cause consumer inconvenience because of the construction of duplicative facilities, e.g., digging up the streets to put in dual gas or water lines. Avoiding such inconveniences is another reason offered for government franchise monopolies for industries with declining long-run average total costs. >It is a myth that natural monopoly theory was developed first by economists, and then used by legislators to "justify" franchise monopolies. The truth is that the monopolies were created decades before the theory was formalized by intervention-minded economists, who then used the theory as an ex post rationale for government intervention. At the time when the first government franchise monopolies were being granted, the large majority of economists understood that large-scale, capital intensive production did not lead to monopoly, but was an absolutely desirable aspect of the competitive process. http://mises-media.s3.amazonaws.com/rae9_2_3_3.pdf http://mises-media.s3.amazonaws.com/rae9_2_3_3.pdf
stephenboyd 5y ago
The price the users pay to Facebook is their privacy and attention. What would a price cap for that look like?

jdhzzz 5y ago

Make them a (common carrier)[https://en.wikipedia.org/wiki/Common_carrier https://en.wikipedia.org/wiki/Common_carrier] just like was done for WAN access in the USA. Hahahahahaha.

kortilla 5y ago

Absolutely not a solved problem. The utilities have no reason to innovate at that point. In my local municipality I have no way to choose renewable energy apart from building my own power plant on my roof. That’s a complete failure of these government granted monopolies.

8note 5y ago
What incentive does the app store have to innovate now?
spywaregorilla 5y ago
There's no such thing as choosing renewable energy on a grid. Energy is fungible. If you get on one of those "choose green" schemes, you're just getting the same energy but also buying some credits from somewhere else.
enjo 5y ago
The regulating bodies of those utilities work hard to create incentives for them to innovate. I spent four years of my career working on energy programs with major utilities around the country in which they tried to incentive reductions in energy usage. Which is a curious statement: why would a electrical utility want people to use less electricity? The reason is because the regulatory agencies created incentives within the regulatory framework to encourage them to do it. Basically the regulators start with an outcome, bake that outcome into how utilities get paid, and then let the utility innovate to figure out how to do it. This led to meaningful reduction in energy usage across many markets.
- verdagon 5y ago
  I'd love to hear more, what kinds of incentives? Is it something like, "if you get X efficiency, you get N more dollars"?
  - enjo 5y ago
    There are a bunch of different models but they mostly come down to the regulatory agency (IE: the PUC) creating a pot of money for utilities that is paid out when they reach energy reduction goals. You can learn more by looking into Demand Response programs and Demand Management programs around the country.
tehjoker 5y ago
It's not something that should be a choice. The government should move as much power to renewable as fast as possible and you should just keep getting power. This idea of "choice" for a commodity based on how it was produced not based on any features is crazy and will never work.
rhizome 5y ago
What's wrong with your local power provider not incorporating renewables? There are still solar installers, and it probably a better deal overall to own your own plant, as it were.

kevin_thibedeau 5y ago

My city recently forced every resident into an esoteric market-based solution for electricity (sold with a pack of lies about renewable energy and reduced rates) that required explicit opt-out to avoid and stay with the provider who actually generates power and services the people on its infrastructure.

Scoundreller 5y ago
Which city?

liquidify 5y ago

It is not a 'solved problem'. Price controls are not easy for anyone to manage. Companies can easily find ways around them in many cases. Enabling companies to categorize themselves as 'platforms' or otherwise and then stipulating both benefits and requirements based on those labels makes a lot of sense comparatively. The general problem though is that the government isn't typically using regulations to improve freedom and competition. The government looks at regulation as a way to extract money, so solutions that encourage competition on a level playing field through market forces (like OP's) aren't given fair consideration.

AnthonyMouse 5y ago

> Just do what most American cities do with other natural monopolies like utilities: use careful price controls to cap margins and slow rate increases. Nothing Apple does is a natural monopoly. Artificial monopolies can be maintained through vertical integration. If you don't like their app store, use another one. If all they provide is the app store, that's easy, and every platform would have half a dozen or more. But if using a different app store requires you to develop your own operating system, and convince millions of third party developers to make applications for it even before it has any users, and make your own hardware, on and on, well then it's infeasible to make a competing app store and you get an uncompetitive and abusive market. The solution there isn't to regulate it like a utility, it's to break up the company so that the operating system isn't made by the same company as the app store and has no reason to restrict the users to only the one. Then you have competition again and don't need any regulation other than the constraint on vertical integration.

atdrummond 5y ago
What is relevant is that the App Store is a natural monopoly within the iOS ecosystem. As long as Apple has such significant market power (including a substantial market share, especially as a percentage of revenue, not just units sold) their natural monopoly on the iOS platform will extend to them being a willing participant in an oligopoly. Said state of affairs is the expected outcome of Apple having a natural monopoly and there being only one other substantial mobile OS market participant, who just so happens to also operate a natural monopoly for app sales - albeit a much, much more tenuous one.
- shakna 5y ago
  > What is relevant is that the App Store is a natural monopoly within the iOS ecosystem. That's very much not a natural monopoly, but a constraint that is forced onto the ecosystem by Apple. There is no technical reason for it existing, but it exists by design.

barry-cotter 5y ago

There's no historical evidence of natural monopolies existing at the scale of cities. There are multiple American examples of decades long competition in utilities. The economic rationale for politicians to give their friends local monopolies long postdates the practice of doing so. > The Myth of Natural Monopoly > Most so-called public utilities have been granted governmental franchise monopolies because they are thought to be "natural monopolies." Put simply, a natural monopoly is said to occur when production technology, such as relatively high fixed costs, causes long-run average total costs to decline as output expands. In such industries, the theory goes, a single producer will eventually be able to produce at a lower cost than any two other producers, thereby creating a "natural" monopoly. Higher prices will result if more than one producer supplies the market. > Furthermore, competition is said to cause consumer inconvenience because of the construction of duplicative facilities, e.g., digging up the streets to put in dual gas or water lines. Avoiding such inconveniences is another reason offered for government franchise monopolies for industries with declining long-run average total costs. >It is a myth that natural monopoly theory was developed first by economists, and then used by legislators to "justify" franchise monopolies. The truth is that the monopolies were created decades before the theory was formalized by intervention-minded economists, who then used the theory as an ex post rationale for government intervention. At the time when the first government franchise monopolies were being granted, the large majority of economists understood that large-scale, capital intensive production did not lead to monopoly, but was an absolutely desirable aspect of the competitive process. http://mises-media.s3.amazonaws.com/rae9_2_3_3.pdf http://mises-media.s3.amazonaws.com/rae9_2_3_3.pdf

stephenboyd 5y ago

The price the users pay to Facebook is their privacy and attention. What would a price cap for that look like?