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Yeah, I'm fine splitting youtube and google and even adwords. I don't think any of the rest are viable businesses, TBH. However I don't think this will solve t
by rsj_hn 5y ago
Yeah, I'm fine splitting youtube and google and even adwords. I don't think any of the rest are viable businesses, TBH.
However I don't think this will solve the issues raised in the original article or the general issues with monopoly.
People used to think that Microsoft had an unfair monopoly with its browser because of bundling. Well, Chrome took over market share pretty easily when it released something better. It turns out it wasn't bundling, but investing more dev resources than the competitor that made the difference. And you can do that if you have surplus profits from a monopoly. It is those profits that allow for more resources that make the difference, not any consumer-facing bundling problems.
So even if you completely eliminate the bundling, you'll still have a situation where off-shoot products by monopolies outcompete other self-funded products. Now, you have to complain not about bundling, but about subsidies -- basically making it illegal for the monopoly to branch out into another business, because all tech investment starts out as subsidies. But now you are really hurting innovation, because a large part -- I would say a large majority -- of innovation happens as subsidized R&D performed by monopolies. From the invention of C at Bell Labs to Android at Google. These are all side projects afforded to monopolies but not to private investors, who would never invest in such things. Thus no standard of consumer harm will result in making this illegal.
So you say, OK, we wont ban a firm from creating other products but we will ban it from purchasing companies. So that takes care of Youtube and Adwords, but not android, office, etc. But now if the monopoly has surplus profits, it has an edge at making competing products and outcompeting smaller incumbents. Yes, it's harder than just buying them, but you have not fundamentally changed the landscape. It's an improvement, yes, but only a marginal improvement.
It's really a tough call, and not at all the same thing as the previous US push on anti-trust, which was conceptually much simpler until you had the ill-advised ATT breakup, which showed the limits of the old approach. Merely longing for the old days of anti-trust in which we were busting up Standard Oil doesn't address any of the reasons why we have moved past that period.
- toast0 5y ago> Well, Chrome took over market share pretty easily when it released something better. It certainly didn't hurt that they promoted the hell out of it on all of their market dominant properties. (As well as the, then common, practice of paying to have it included it in freeware downloads of all kinds; which to your point is more subsidy than anything else) I can see your point about R&D. When a company is more profitable/less competitive, there is an ability to do more of the open ended research that can lead to great things that aren't closely related to the company business. But does that justify the lack of competition that results? The consumer harm is difficult to quantify, of course, because consumers are generally not paying in dollars for these services; but maybe search competition would result in fewer ads and a more clear separation between ads and found content, which may be more useful. You could also consider that to some degree, advertising costs drive up the price of goods sold through those ads, and therefore the lack of competition in ads may cause consumer harm in that way (but, of course that's a tenuous argument, a lot of companies will spend their ad budget regardless)