Thiel is correct that capitalism is more about monopoly, rather than competition, and of course the fact that innovative companies in newly emerging markets hav

Thiel is correct that capitalism is more about monopoly, rather than competition, and of course the fact that innovative companies in newly emerging markets have managed to obtain locks on natural monopolies (eg in operating systems, telephone networks and so on) has led to huge success and profits. But he's completely wrong that this is a good thing, at least not for the overall economy in the long term, as opposed to individual companies in the short term. To extend his example, if the restaurant business were like search engines, you'd have a choice of just a few big chains (maybe macdonalds, and pizza hut) which would be on every street. Direct competition is absolutely vital, because it drives innovation. Innovation is how companies escape competition. Companies should perhaps enjoy some limited "monopoly" over their innovations, but they should not be allowed to milk them forever, and probably, for example, the current patent system awards much too much and too long a monopoly for much too little innovation. Introducing, encouraging, or even mandating competition by splitting companies up, is required in order to keep companies innovating, rather than dominating and then exploiting, and it is one of government's most important functions, sadly neglected in recent decades. Of course VC fund managers like Thiel would like you to believe that monopolies are good, since that's how they profit - invest upfront, and then reap huge rewards based on monopoly valuations.